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1. Background

Tanzania has an area of 945.239 sq.km (94 million ha), 44 million ha are classified as suitable for agriculture and about 10.1 million ha or 23% is under cultivation. Agriculture is the leading sector of the economy. It accounts for about 26% of GDP. Over 80% of its 40 million people are living in the rural areas with agriculture as the mainstay of the living and smallholder farmers cultivate between 0.2 and 2.0 ha the level of mechanization is low with the hand hoe dominating in farming systems. The use of animal traction is estimate at 24% and the mechanical power is estimate at 13%.. Examples of agricultural mechanization equipment are tractors, power tillers, weeders, maize shellers, sugar cane forklift and mechanical harvesters. Some tractor models have experienced (frequent) breakdowns and some more feedback is expected from services agents & suppliers.

The Role of Agricultural Mechanisation

  • Mechanization is a necessary condition for farmers to improve productivity of labour and land.
  • Mechanization of agriculture has the potential to turn idle land into productive land for national economic growth and increase of land.

 

2. Present situation of Agriculture Mechanisation.

Most farm land is still ploughed with hand hoe and ox plough. The number of tractors is on the increase (see table below). Most farm mechanisation is limited to tractor and plough. There are few machine harvesters and very few mechanised dryers and maize shellers; Many tractor operators/owners have also trailers to transport farm produce from the farm to the house or to the market.

In the tea sector, there are now mechanised tea picking machines (Mufindi); In the sugar, there are now forklift trucks and sugar cane cutters (Kilombero). Also water pumps are widely used in the county. Some are connected to tractor engines, others are driven by electric power supply or (mobile) diesel engines.

Trends and Statistics on Farm Mechanisation There has been a 300% increase in number of tractor in use. (see table below). Therefore the amount of arable land per tractor has reduced from 1196 ha (1995) to 442 ha per tractor (2007) . Also there has been an increase in number of tractors per 100 sq.km from 8 (1995) to 24 (2007). The following indicators show the degree of agricultural mechanization in Tanzania:

3. Potential for Investment in Agricultural Mechanization.

Large areas of farm land are still available for mechanisation. Most suitable land for mechanised ploughing has (medium-) deep soils without roots or where roots of trees have been removed. Flat perimeters in irrigation areas are also very suitable for mechanised, ploughing, planting, weeding and harvesting. Hilly areas can also be ploughed by tractors, but requires ridging along the contour lines (horizontal ploughing). This to avoid the run-off of rain water and soil erosion from the hill downwards in freshly ploughed vertical ridges.

  • Mechanisation is more than tractorization. With additional / auxiliary equipment the tractor can be used for planting, weeding; shelling; harvesting and water pumping. It could even be used to distribute fertilizers and spray agro-chemicals). This will assist the efficient use of equipment and facilitate loan repayment.
  • The government will support farm mechanisation through policies on mechanization of crop production and increased productivity.
  • The private sector is allowed and encouraged to acquire machinery and provide hire services to farmers for primary and secondary agricultural operation importation trends show a steady increase in number of imported mechanical power machines
  • Demand for two axle tractors and implements are 1500 –1800 p.a. and increasing
  • Demand for single axle tractors is 1500 – 2000 p.a. and increasing.

4. Challenges in Agricultural Mechanisation

  • Low purchasing power and management skills in operation and maintenance of most small scale farmers.
  • Mechanisation can attack low productivity / low farm income as farmers in the past used mainly hoe / ox plough for land cultivation.
  • Low producer prices due to lack of bargaining power and market information.
  • High cost of agricultural machinery despite the low or no import charges on agricultural machinery.
  • Limited access to agricultural credit.
  • Lack of well trained operators and mechanics for farm machinery.
  • Lack of suitable machinery packages for main agricultural operations.
  • Importation of tools, equipment and machinery of poor quality is costly.
  • General poor technical know how among tractor owners/operators.
  • Use of secondary tillage implements is limited (only plough is commonly used).
  • Limited availability of spare parts and trained technicians for operation and maintenance.
Years 1995 1997 1999 2001 2003 2005 2007
Number of Tractors in use 7525 10435 14345 18255 21300 21500 21500
Number ha arable land in million 7525 8.95 8.85 8.9 9.47 9.5 9
Number of ha arable land per tractor 1196 858 617 488 445 442 442
No. of tractors /100 sq. km arable land 8 12 16 21 22 23 24

Source: World Bank Indicators - Tanzania - Agricultural Production, 2012 - 04 -19

 

Operation & Maintenance of Agricultural Equipment Tools

  • The tractor and its implements play a significant role in mechanised agriculture. Tokeep them working for a long time at a minimum cost, they require an adequate and timely maintenance. The following are equally necessary.
  • Suppliers and Availability of Spare Parts.
  • Training of Tractor Owners/Operators.
  • Possibilities of Service Contracts (attractive for bank lending).

 

5. Potential for Improving Agricultural Mechanisation

  • Large areas still available for mechanisation ( flat, deep and fertile soil; )
  • Government will/support through policies on mechanization of crop production and increased productivity.
  • Farmers’ will to use farm machinery
  • The private sector is allowed and encouraged to acquire machinery and provide hire services to farmers for primary and secondary agricultural operation.
  • Importation trends show a steady increase in number of imported mechanical power machines.
  • Demand for two axle tractors and implements are 1500 –1800 p.a. and increasing
  • Demand for single axle tractors is 1500 – 2000 p.a. and increasing

There is a potential for establishing tractor mechanisation pools for groups of farmers organised in a cooperative or farmers associations or a private tractor company, which is eager to rent out farm mechanisation equipment (e.g. a tractor hire service company, like TFA/TFSC in Arusha).

High Potential Areas for Introduction & Expansion of Agric. Mechanisation

  • SAGGOT, this include Coast, Morogoro; Iringa, Mbeya, Ruvuma, Rukwa.
  • Central Zone, this include Dodoma; Shingida;
  • Lake Zone, this include Shinyanga, Mwanza; Mara; (only 4 districts in Kagera: Biharamulo/Chato and Karagwe; Missenyi) Manyara Regions: Kiteto; Babati and Hanang esp. Bassuto District
  • Arusha & Kilimajaro Regions: all districts, esp. Lower Moshi Irrigation schemes and similar irrigation schemes in Same etc.
  • Coastal Zone, this include Tanga (excl Lushoto), Bagamoyo, Kibaha, Rufiji Basin, Lindi, Mtwara.

 

6. Financial needs for Agricultural mechanisation. 

  • Due to the high cost of farm mechanisation, most agri-business entrepreneurs, commercial farmers or farmers associations (FA),cooperative savings organizations (SACCOS) and the like need external financing (loans) to be able to procure new farm equipments and tools.
  • In some cases subsidy schemes for farm mechanisation are available from the government through Armed Forces Development Organisation (JKT); Agricultural Window of the Tanzania Investment Bank (TIB); Agriculture Input Trust Fund (AGITF); some donor funded tractor and/or SME schemes.
  • Most tractor & farm mechanisation schemes need the technical support from dealers or technical equipped workshops, because the operation, maintenance and repairs of many tractors and other mechanisation equipment is poor. Frequent break downs also cause poor loan repayment.

Individual agri-business entrepreneurs / farmer groups associations may seek financial assistance for agricultural mechanisation for:

  • Expand the area suitable for mechanised crop production (especially in irrigation areas with 2 harvest per year).
  • Also for bush clearing - to make land available for ranchingrequires the use of mechanised bush clearing equipment (bulldozers).
  • Improve soil tillage for crop intensification as higher yields can be achieved by making better use of improved seeds, fertilizer, agro-chemicals, etc.
  • To overcome labour shortcoming in the farm in critical farming periods (by mechanised ploughing, weedin, harvesting).
  • To reduce cost of labour by substituting labourers with power tillers and tractors, or go for complete mechanised crop production including harvesting, threshing, bagging and bailing.
  • Post-harvest equipment, grading, sorting and packaging equipment and materials. Source of Funds:
  • Own Funds from Savings.
  • Bank Loan from Commercial -, Community - and Cooperative Banks.
  • Micro-Finance Institutions (MFI) and Rural Financial Institutions (RFI).
  • Government: Agricultural Input Trust Fund (AGITF); SME Schemes
  • Cooperatives such SACCOSs and AMCOSs;
  • Assistance to access loans from sources above with Possibility of Loan Guarantees: GOT; PASS.

 

7. How PASS can help development of Agric. Mechanisation on farms.

PASS TRUST does not lend out money, but can assist farmers/clients to get bank loans (financial linkage) for purchasing farm machineries and agro-processing equipment through;

  • Making feasibility studies and preparation of business plans for proposed crop & livestock mechanization and agro processing and submit it to bank for loan.
  • Capacity building of farmers groups and entrepreneur management skills in farm mechanization and agro-processing, especially in irrigation areas.
  • Training on operation, maintenance and service of farm machineries and post harvest technology and agro processing (for example: for rice and other crops grown in irrigated or upland farming areas).
  • Training in agro-processing: operation, maintenance and service of agriculture processing equipment, rice & maize milling, coffee hulling; oil extraction from sunflower and other edible oil products; and processing of other commodities.
  • Assist in market research and market linkages.
  • Counselling and assisting in financial management of agribusinesses in mechanized crop and livestock production and agro-processing.
  • Backing up loan applications by topping up collateral to level required by banks.
  • PASS can provide a lease product for hire-purchase of farm machineries. This is a new PASS financial products also called asset based financing.
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