1.1. Maize Production
Maize is the main food crop of Tanzania averaging 4.5 million metric tons in 2010/2011 seasons Tanzania is endowed with more than 3.3 million hectares land with suitable climate (medium-high elevation) for the production of specialty maize that commands high prices on the world market.
The current average yield per hectare is between 1.2 ton/ha (MOAFSC statistics 2011/12- see below table).) and 2.0 tons. (FAOSTAT 2012). Tanzania has the capacity to produce 1.3 – 1.5 metric tons per hectare annually if small-scale farmers were to adopt improved farming practices. Maize production has been increasing from year to year due to priority set by the government.(see table below).
|Export in (MT)||0||0||0||50000||50000||15000||44690|
Source: Maendeleo ya Kilimo na Ushirika kwa kipindi cha Miaka 50 ya Uhuru kwa Tanzania Bara (1961-2011) and FAOStat 2012/13, Copyright 2011, Agriculture and Trade Opportunities for Tanzania, working paper , Dcember 2011, United Nations University, UNU-WIDER Food Security, IFPRI,www.foodsecurityportal.org/tanzania.
Maize production in Tanzania has been increasing from year to year due to priority has been provided by the government Tanzania is endowed with more than 3,3 million hectares of lands suitable for maize production. Increase in yield are mainly caused by amount of farm inputs, technology and know-how of producer.
Maize is grown all over the country especially in Iringa, Mbeya, Ruvuma, Rukwa, Tanga, Kilimanjaro, Kagera (Biharamulo), Morogoro and in Arusha/Manyara regions. 40% of the national maize production comes from 4 regions: Iringa, Mbeya, Ruvuma, Rukwa.
Small-scale farmers are dominating the maize production in Tanzania. They account for roughly 85 percent of total production. Medium and large-scale farms make up for 10
percent and 5 percent respectively. Although large and modern farms exist, agricultural production in Tanzania remains grounded on subsistence farming.
Maize is mostly grown under rain fed cropping systems that can be classified into two categories, namely; the short rains (Vuli) season that starts from September/October to January/February and the long rains (Masika) season from February/March to June/July.
Maize is available in large quantities from March to August and in smaller quantities during August to January.
The marketing of maize is done through private markets as well as through the mixed crop board, under the Ministry of Agriculture, Food Security and Cooperatives.
1.2 Rice Production
Rice is the second most important food and commercial crop in Tanzania after maize; it is among the major sources of employment, income and food security for Tanzania farming households.
Tanzania is the second largest producer of rice in Southern Africa after Madagascar with production level of 1,1 million tons (FAOSTAT, 2010- see below table). The rice cultivated area by 2012 was 720,000 hectares and the average yield per hectare from 2003-2012 is very low, 1.8 tons per ha.
About 71 % of the rice grown in Tanzania is produced under rain fed conditions; irrigated land presents 29 % of the total with most of it in small village level traditional irrigation systems.
Farmers grow a number of traditional varieties, these varieties have long maturity and yield is affected with irregular rainfall pattern and occurrence of pests which contribute to the yield decline.
Historically, rice has been categorized under the staple food crop rather than commercial/cash crop. However, in recent years with the rapid growth of cities and towns propelled by rapid population growth, the country has experienced enormous increase in rice demand. With negligible percentages of rice imports, most of rice demanded and consumed by the urban population is sourced from the rural rice producing areas that have stagnating production capacities. For this reason, rice has consequently been transformed into commercial crop.
Tanzania is endowed with more than 2 million hectares of lands suitable for rice production. Increase in yield are mainly caused by amount of farm inputs, technology and know how of producer. Rice production in Tanzania has been increasing from year to year due to priority has been provided by the government.
Table 2: Rice production and export yield trends
|Export in (MT)||7825||140||4158||78||1025||523||45|
Rice is mostly grown in Mwanza , Shinyanga (Bariadi & Maswa), Morogoro (Kilombero, Wami- Dakawe ); Tabora (Igunga), Kilimajaro (lower Moshi), Coast (Rufiji, Lindi), Mbeya (Mbarali, Kyela, Kapunga) and Rukwa Regions. 25% of the national rice production comes from 2 regions: Mbeya and Morogoro Rice production in Tanzania is mainly done by small and medium size rice farmers. However there have been a number of large scale mechanized rice schemes in the country (mainly for export). There has been an increase from year to year due to priority has been provided by the government. The marketing of rice is done through private markets as well as through the mixed crop board, under the Ministry of Agriculture, Food Security and Cooperatives.
2. Potential for Investment in Maize and Rice Sub-Sector.
2.1 Maize sub-sector
Therefore investing in the maize sub-sector should focus on:
2.2. Rice sub-sector
Therefore investing in the rice sub-sector should focus on:
3. Financing needs for the Maize and Rice sub-sector.
Entrepreneurs and small holder farmer groups may seek financial assistance for:
4. How can PASS help Farmers in the further expansion/Intensification of the Maize and Rice Sub- Sectors.
Tanzania ranks is third in Africa on livestock production and in terms of cattle population after Ethiopia (31 million) and Sudan (30 million). According to 2007/2008 livestock census, the dominant species are cattle (21,280,875) followed by goats (15,154,121), sheep (5,715,549) and pigs (1,584,411). The total number of livestock units is 25,977,665. About 90% of the livestock population is of the indigenous type. The livestock sector provides livelihood support to approximate 1,745,776 (37%) households, out of a total of 4,901,837 agricultural household (URT, Livestock survey census 2005.). The livestock sector grows at a rate of 2.7% per annum. The livestock industry contributes 30% of agricultural GDP (2010). The livestock sector contributes about 4.7% of the GDP (947 billion TZS)- which was equivalent to 789 million USD (2009 data). 24 million ha are used for cattle grazing (2007/2008 livestock census) mostly in Shinyanga, Arusha, Manyara, Tabora and Mwanza. The highest goat population is in Shinyanga, Arusha, Manyara and Tabora. Pigs are more common in the southern regions of Mbeya and Iringa, as well as in Kilimanjaro and Dar es Salaam regions.
Common sources of meat are beef cattle, sheep and goats, pigs and poultry. Cattle contributes 53% of the total meat production, whereas sheep and goats contributes 22%. Beef production in Tanzania mainly comes from traditional sector that is dominated by Tanzania Short Horned Zebu (TSHZ), agro-pastoral system contributes 80% and pastoral system contributes 14%. Only 6% of meat production comes from commercial ranches. In 2009 the annual meat production was 449,673 tons and per capital meat consumption was 12kg. Hence we lag behind the recommended consumption standard of FAO that is 50kg per annum. Current per capita meat consumption stands around 24kg per annum.
The country produces 462,686 tonnes of meat annually for domestic consumption but also imports 800 tonnes high quality meat to meet demand for tourist hotels and mines. There is also a substantial export of meat and live animals. Statistics show that the country earned TZS 3.81bln/- from the export of 3,362 cattle and 4,060 goats and sheep. (2011/2012).
Challenges facing Production and Productivity in Beef SubSector
About 600,000 of total cattle population in Tanzania are dairy cattle. Milk production from cows during the wet season was 1.6 billion litres and 0.9 billion litres during the dry season. About 60% of milk produced by indigenous cattle kept in rural areas, and 40% kept by improved cattle mainly by smallholder producers, milk yield from indigenous to improved dairy cows ranges from 1-2 litres and 7-10 litres per cow per day respectively, at present 10% of milk produced annually enter the market, and the remaining is consumed at home or considered to a waste commercially mainly due to lack of collection system.
At present there are about 48 small and medium milk processing plants with installed capacity of 394,600 litres per day. The majority of these plants operates at very low capacity. The average of these processing plants currently process about 105,380 litres/day, which is equivalent to 27% of installed capacity. The current processing capacity accounts for 5% of the annual milk production as many consumers buy unprocessed milk from dairy farmers in their neighbourhood.
Challenges facing Production and Productivity in the Dairy Sub-Sector
2. Potential for Investment in Beef and Dairy Industry.
Carrying capacity of the rangeland in Tanzania is estimated at 20 million animal units but currently there are only 16 million animal units. There is ample potential for expansion of the livestock industry through better animal husbandry, improve breeding and addition of livestock.
The import of 800tonnes of high quality meat for tourist hotels and mines cost Tanzania 10billion annually. This demand could potentially be met by high quality local production. This situation could also be used as a window of opportunity to improve the standard of beef production and meat grading in slaughterhouse operations.
The increasing demand of meat of the eastern and southern African countries are potential market once better animal husbandry practices are adopted and improved processing facilities established and operational.
Potential for Increase in Output/Production and Productivity of Meat Animals
Potential for Increase in Output/Production and Productivity of Dairy Animals
3. Financing Needs for the livestock sector
Financial support in this industry is of great importance due to its capital intensity.
Financial needs for the livestock sector falls under:
Livestock Entrepreneurs / Farmer Groups may seek financial assistance for:
4. How can PASS help Farmers in the Beef and Dairy Industry? (in the livestock sector by intensification of animal production and improved beef and milk processing).
The floricultural and horticulture industry in Tanzania has around/approximate 50-100.000 hectares. This is approximate 5-10% of the total farm land under cultivation.
Most of the horticulture lands are located in low and highlands, but export oriented horticulture is concentrated in the higher-altitude temperature zones of Arusha and Kilimanjaro regions. The commercial floricultural belt is almost exclusively in the Arusha and Kilimanjaro regions located, although a few experimental flower farms are located in the higher-altitude temperature zones of the southern Highlands near Iringa-Njombe and Mbeya.
|Central plateau (Morogoro/Dodoma)
||Northern highlands (Arusha/Kilimanjaro)
||Coast Zone (Tanga/Pwani)||Southern highlands (Iringa)|
|Suitable for tropical fruit (passion fruit, mangos) as well as flowers||Citrus fruit and tropical fruit||Ideal for full range of European flowers, cuttings, vegetables, fruits and seeds||Citrus fruit and tropical fruit||Ideal for full range of European
flowers, cuttings,vegetables, fruits and seeds
|Advanced plans by consortium of 16
Dutch flower farmers to set up farms
|Associati on of mango
farmers exporting to Asia
|More then 30 flower and vegetable farms already exporting to Europe||Dutch group developing passion fruit frozen concentrate operation||Traditional fruit growing area|
Horticulture and Floriculture Production & Statistics
Tanzania produces 1,709,622 metric tons of fruit, 656,513 metric tons of vegetables and 9,390 metric tons of flowers annually (MAFC, 2012).
Horticulture sub-sector registered a growth of eight to 10 per cent in the last four years before the 2008/2009/2010 global economic crunch.
Currently the country earns only about $200 million annually from the export of horticulture produce, the amount considered far below the existing potentials.
Tanzania Annual Fresh Vegetables, Flowers and Fruits Production 2005/2006-2010/11 (MT).
According to the market possibilities, the main export destination of Tanzania’s cut flowers is the European Union. Currently, the Netherlands imports about 90% of Tanzania flowers. The market is open in most European countries for Tanzania flowers using the opportunity granted by the EPA and EBA agreement between the European Union and Tanzania, being a member of the ACP group of countries. There is a growing demand for Tanzania’s flowers in the Gulf States and in the local market for example Dar-es-Salaam, Arusha and Moshi. So it is high time for the farmers in Tanzania to step up and tap the outstanding opportunities that have presented themselves in our fortunate nation.
Cut roses are the main flowers produced in the floricultural industry of Tanzania and account for between 75% and 80% of all flowers produced for export. Flowers are produced as final consumer products and need no processing after harvest. Harvesting can be done three times a year in the case of annual flowers. Most cut roses are produced in Arusha and Kilimanjaro regions.
More than 40 export-oriented floriculture and horticulture enterprises already operate in Tanzania, employing more than 10,000 people. Exports are growing by more than 7% per year.
2. Potential for Investment in Horticultural and Floriculture Industry.
At present Tanzania has only reached a 10% of the total exports volume/value and jobs generated of the horticulture and floriculture produce/ sector of the East African Region. Therefore there is still a hugh potential to develop horticulture and floriculture in Tanzania, as it has ample land and water resources, but more emphasis has to be placed into training of skilled manpower.
Horticultural and Floricultural Production
Expansion of Horticulture and Floriculture areas:
Intensification of Horticulture and Floriculture areas:
Develop Production and Marketing Infrastructure
Basically potential investors are encouraged to invest in horticulture and floriculture suc-sectors as a good return can be expected in the high potential areas.
These regions are Arusha, Kilimanjaro, Morogoro, Tanga, Iringa and Mbeya. These regions have a conducive infrastructure system that can aid the transportation of the flowers and vegetables to airports for further exported to the abroad. Producers in Arusha and Kilimanjaro regions have easy access through the Kilimanjaro International Airport (KIA), where Iringa and Mbeya regions are close to the international airport that will be constructed in Mbeya town. Tanga is close by to the Mombasa International Airports and lastly Morogoro region which is a close neighbor to the Dar-esSalaam International Airport. All above mentioned regions have large arable lands suitable for temperate production of fresh and dried flowers for the world market. So in all the five regions pointed, there are investment opportunities for commercial flower and vegetables production. Furthermore there is also the availability of cheap labor which can help to minimize the production cost. So, Tanzania has open doors for investors to exploit these outstanding opportunities / potentials that are available.
Develop Existing and Future Market Potential
The main export destination of Tanzania’s cut flowers is the European Union. Currently, the Netherlands imports about 90% of Tanzania’s flowers. Most are sold at the auctions and therefore preference and price for Tanzania flowers is based on quality. Only about 10% are supplied to retailers in other European countries (Germany, the United Kingdom, Norway, Sweden and Italy) where some bargaining for prices can take place.
Global demand for floriculture and horticulture products is large and growing, particularly in markets that Tanzania is well placed to supply. This global demand has been growing by more than 7% per year; over the same period, production in the traditional (e.g. European) countries has been flat or declining. Demand is growing fast in Asian markets, in countries like China, India and the Middle East. Dubai has recently started the Dubai Flower Centre (with the capacity to become the world’s second largest fresh produce hub) and is seeking to develop new sources of supply.
Basically there are vital locations that investors can invest in return for huge dividends due to the potentiality of the location. These regions are Arusha, Kilimanjaro, Morogoro, Tanga, Iringa and Mbeya. These regions have a conducive infrastructure system that can aid the transportation of the flowers and vegetables to the Airports ready to be exported to the abroad. For Arusha and Kilimanjaro have easy access through the Kilimanjaro
International Airport, where Iringa and Mbeya regions are close to the international Airport that will be constructed in Mbeya town, Tanga is close by to the Mombasa International airports and lastly Morogoro region which is a close neighbor to the Dar-es-Salaam
International Airport. Apart from that the regions mentioned above have large arable lands suitable for temperate production of dried flowers for the world market. So in the five regions pointed are all ideal for commercial flower and vegetables production.
Floriculture like any other agricultural industries is a farming operation that use the most efficient means of farming irrigation, and in this case, water is a key input. If roses go without water for 24 hours, replanting may be necessary and this is expensive. Farms are therefore located in areas where water supply is assured. Deliberate steps are taken (through reservoirs, boreholes, etc.) to ensure that water availability is at least twice as much as demand at any time. Sources of water include springs, rivers and boreholes.
Drip irrigation is the system most commonly used, being the most efficient available. Six farms uses drip irrigation while the remaining two uses overhead sprinklers.
The sources of water are boreholes, springs and rivers such as Usa and Nduruma in Arusha region.
The sector appears to make intensive use of female labour. It is quite evident that it has created new jobs for women and provided additional income-earning opportunities for field research and case studies were carried out on cut-flower growers who have significantly altered their local production and employment base by entering the cut-flower export market.
Cut-flower production employs 2,347 workers from surrounding villages, the majority (57 per cent) being women, their jobs being harvesting, grading and packing. Men spray, irrigate and do similar manual tasks.
Employment is categorized into four groups – management, skilled labour, casual labour and others (especially the consultants engaged in the maintenance of cooling machinery, extension and quality control services, and marketing).
Local communities have also benefited from increasing incomes. Inter-regional migration has been encouraged from Singida, Dodoma, Tanga and Kilimanjaro. Coffee farmers in the Arumeru district of the Arusha region have sold/leased their farms for cut-flower production.
Most employees come from the surrounding areas with Arusha, Kilimanjaro, Singida, Tanga and Dodoma being the major sources. Seven farms indicated that most of their labour force came from Arusha and Kilimanjaro.
This implies that the labor market allows mobility of workers to the cut-flower industry. These workers are sufficiently adaptable and flexible to respond to changing requirements of the workplace and to enhance the competitiveness and growth of the industry.
3. Financial the Needs of the Entrepreneur in the Horticultural and Floricultural Industry.
Entrepreneurs / farmer groups may seek financial assistance for:
4. How can PASS help farmers in the Horticultural and Floricultural production
PASS’s core business is to provide advisory and financial services (mainly financial linkage with/out credit guarantee). In this PASS prepares presents to commercial banks and thereafter supports those investments with credit guarantee fund. PASS collaborates with commercial banks in which at present there are seven partner banks.
Irrigation is the controlled flow of water to the farmland in order to optimize farm production. It is used to assist in the growing of agricultural crops. Irrigation has also been used for suppressing weed growing in grain fields and helping in preventing soil degradation.
Modern irrigation was introduced in Tanganyika in 1930 through the establishment of the Tanganyika Planting Company Ltd (TPC) and other commercial farms and estates. Since Independence a large potential for irrigation has been identified, partly as commercial irrigation schemes, partly for smallholders organised in water users associations (WUA). Only part of that potential has sofar been realised.
2. Present Situation of Agricultural Irrigation in Tanzania.
At present Tanzania has large number of small, medium and large scale irrigation schemes. The total area under irrigation is at present 270,000 ha of a 29,400,000 ha total area suitable for irrigation. 2,300,000 ha is considered high potential and 4,800,000 ha is considered medium potential for irrigation.
The actual land under irrigation 3.8 % of total potential and this is only 0.92% of the total area suitable for irrigation.
Irrigation and drainage are interlinked. Irrigation is the controlled supply of irrigation water. This can never be achieved without proper control of excess water (‘drainage’).
This is also vital to avoid salinization of soils and hence making farming land less productive. Irrigation is another way to increase productivity of farm land and create conditions for a more stable harvest and hence increase income.
Irrigation and drainage services are often combined into one Government Irrigation and Drainage Department in Tanzania this is called the Zonal Irrigation Office. Some irrigation schemes are built with private funds or funds and labour input from farmers’ associations, producer cooperatives; irrigations associations.
3. Potential for Investment in Agricultural Irrigation.
29,400,000 ha is considered the total area suitable for irrigation. Another source mentioned that 2,300,000 ha is considered high potential and 4,800,000 ha is considered medium potential for irrigation, which still need to be developed.
Large areas available for irrigation and mechanisation (flat; deep soil) with sufficient access to (irrigation) water in their respective ‘catchment areas’.
Irrigation combined with mechanization can improve land and labour productivity, hence increase the low farm income as farmers in the past were dependant on rainfall farming with risks of floods, drought etc.
Effective irrigation also needs to be combined with increased use of farm inputs (high quality seeds, fertilizers, agrochemicals etc) to reach maximum yield increase. Also mechanisation can improve productivity and reduce dependence on hoe / ox plough for land cultivation.
Irrigation and drainage structures can also be built with private funds or funds and labour input from farmers’ associations, producer cooperatives; irrigations associations. However, cost of design and building physical irrigation and drainage structures is high: up to USD 1,000 – 1,500 = TZS 1.6 – 2.4 million per ha for technical irrigation and USD 500 – 700 = TZS 0.8 – 1.1 million per ha for semi-technical irrigation.
Traditional irrigation – which is less productive due to inadequate water control is cheaper per hectare. On individual farms, especially on intensive horticulture farms (vegetables, fruits & flowers), sometimes individual pump irrigation may be technical and economically feasible.
4. Operation & Maintenance of Irrigation Schemes and set up of Water Users Associations /Irrigation Members Associations.
In order to improve operation and maintenance of irrigation schemes it is recommended to:
5. High potential areas for Introduction and/or expansion of Agricultural Irrigation.
6. Financing needs for / in Agricultural Irrigation Schemes.
Due to the high cost of building medium size and large scale (semi-) technical irrigation schemes, most irrigation and drainage works are implemented with government funds (sometimes also with grants/loans from international financial institutions). Usually the design is made by private engineering companies, who will later also be responsible for supervision of the selected building contractor.
Sources of Funds for large scale irrigation schemes: World Bank; IMF; AfDB; EU; JICA etc, due to high capital investment cost and long repayment period.
For the realisation of small and medium size scale irrigation schemes, sometimes members of SACCOS and Farmers Associations use own funds and own labour efforts to develop their own irrigation potential. Other funding agencies are: Government of Tanzania (GOT); SAGCOT; Donor Agencies, etc.
Individual agri-business entrepreneurs / farmer groups may seek financial assistance for agricultural production in irrigation areas for:
7. How PASS can help farmers with small scale Irrigation or individual Enterprise pump Irrigation
Coffee Production Trends For Seven Years
2. Potential for Investment in Coffee Industry
Potential for Improvement in Coffee Production
High Potential Areas for Investment in the Coffee Industry
|Region||Size of the potential||Available infrastructure|
Produce world’s finest coffee with average production of about75, 000 to 10,000 tons per year.
They are located within easy access to the international airport at KIA and have suitable red volcanic soils and an ideal climate for production of specialty coffee. There is access to deep see port at Tanga; railway networks leading to deep-sea port at Mombasa; easy access to Moshi Coffee Auction Center; within close proximity to the Tanzania Coffee Board in Moshi.
Produce 10, 000 tons of mild Arabica coffee annually
They are located within close proximity to potential export routes to
Produce 21000 tons of Robusta annually
|They are located within reach to railway and shipping networks to
export routes either at Kigoma or at Dar-es-Salaam.
SWOT ANALYSIS FOR TANZANIA COFFEE INDUSTRY
3. Financial Needs for the Coffee Sector
Entrepreneurs / farmer groups may seek financial assistance for:
4. How can pass help farmers in the coffee Sector
Intensification of coffee production / improved processing & marketing: