Whether for profit or social motives - and often both - an increasing number of investors are targeting opportunities in African agriculture. At the same time innovative approaches for deploying aid to support farming businesses linked to smallholders are emerging. This blog provides a snapshot of who is doing what, where and how.

26 November 2012

Food security challenges are "complex, immense, frightening and urgent"

In an opinion piece in the Financial Times Paul Polman of Unilever reminds us that, due to a rising population and changing consumption habits, we will need to produce the same amount of food in the next 40 years as we did in the past 8,000.

He calls for increased investment in African agriculture; and for developing country governments need to create long-term partnerships with the private sector, donors and civil society, to stimulate investment in commercial agriculture.

He references the Copenhagen Consensus, which concluded that an investment in fighting malnutrition would benefit people more than any other type of investment – with a return of $30 for every $1 invested.

23 November 2012

With AgDevCo support, smallholder farming undergoes a transformation in Mozambique

Only two years since its launch, the innovative Empreza de ComercializaĆ§Ć£o Agricola Lda (ECA), a social enterprise in Mozambique, is already helping to transform smallholder farming for the better. An independent evaluation conducted by AEMA Development Consultants in 2012 concluded that the business had immense potential.
In the 2011/12 season ECA worked with 900 smallholder farmers in the Barue district of Manica Province, central Mozambique. It organised them into small groups, facilitated access to improved inputs and credit, and provided extension advice and a guaranteed market at fair prices. ECA achieved a 100% recovery on input credit and has expanded its farmer base to 2,200 for the 2012/13 season.
ECA is supported by the Beira Agricultural Growth Corridor (BAGC) initiative, a public-private partnership backed by the Government of Mozambique and international funding partners. ECA received debt and equity investment through the BAGC Catalytic Fund, which is managed by AgDevCo.

The independent evaluation found that: 
  • Maize production for ECA farmers who received the complete input package of improved seeds and fertilisers increased by 104%, from 2.4MT during the baseline period to 4.92MT this year. Other ECA farmers on a lower cost package saw yield average increases of 46%. 
  • ECA farmer household cash incomes increased by an average of 35% for the complete input package and 17% on the basic package. That compares to a slight reduction in incomes of local farmers who were not linked to the ECA programme (likely due to lower rainfall compared to the previous year).
  • Conservation agriculture - minimum tillage to maintain soil quality - was extensively adopted by both ECA beneficiaries and non-beneficiaries within the same communities.
  • Extension services provide by ECA to its 900 farmers during 2011/12 were assessed as “very effective” by over 75% of beneficiaries. Over 98% of farmers rated the extension services as “effective” or better. Before the ECA programme farmers produced using whatever farming practices they chose. Contact with extension staff was totally non-existent or at a bare minimum.
  • Farmers benefited from opportunities for economies of scale because of bulk buying, group marketing and the subsequent reduction in unit transaction costs.
  • The ECA programme has ushered in a new marketing channel for growers’ maize and sesame produce, including a contract to sell some maize to a local brewery.