Business Opportunities in Tanzania

Agriculture

Sector Growth

The agriculture sector grew by 5.0 percent in 2002 compared to 5.5 per cent in 2001. The decline in growth rate was caused by the following factors: unpredictable weather conditions (low and late rains); occurrences of destructive pests such as army worms and queleaquelea, and continued decline of price for crops in both regional and international markets. During 2002, the agriculture sector contributed 47.5 percent to Gross Domestic Product. The agriculture sub-sectors growth rates in 2002 were as follows: fishing, 6.5 per cent; crops, 6.3 per cent; livestock, 3.5 percent; and forest and hunting, 3.0 per cent.

FOOD CROPS

Food crops production in 2002 including cereals  (maize, paddy, millet, finger millet and wheat) amounted to 5,608,000 tons compared to 5,296,000 tons in 2001, equivalent to an increase of 6.0 per cent. Production of non-cereal crops including beans, bananas, cassava, pepper, tomatoes, potatoes and others amounted to 8,750,000 tons in 2002 compared to 8,279,000 tons in 2001, equivalent to an increase of 6.0 per cent. The increase in food crops production in 2002 was as follows: maize, 4.9 per cent; paddy, 7.0 per cent; wheat, 3.0 per cent; millet/sorghum, 10.0 per cent; cassava, 2.0 per cent, and pepper, 269.6 per cent. The production of food crops in 2002 exceeded requirements for the period and hence & led to exports of the surplus, accordance with the government policy of allowing producers to seek for favourable markets with better prices Table 11.1 shows food crops production for 2001 and 2002. 

FOOD CROPS PRODUCTION IN   2001 – 2002 (Tons) 

Source: National Bureau of Statistics

CASH CROPS

In 2002, production of major cash crops, except for cashew nuts and pyrethrum, increased.  Coffee production increased from 43,000 tons in 2001 to 44,000 tons in 2002, equivalent to an increase of 2.3 percent. Cotton production increased from 171,000 bales in 2001 to 178,000 bales in 2002, equivalent to an increase of 4.9 percent.  Sisal production increased from 22,000 tons in 2001 to 23,000 tons in 2002, equivalent to an increase of 4.5 percent.  Tea production increased from 78,000 tons in 2001 to 81,000 tons in 2002, equivalent to an increase of 3.8 percent, and tobacco production increased from 48,000 tons in 2001 to 59,000 tons in 2002, equivalent to an increase of 23 per cent.  Cashewnuts production declined from 95,000 tons in 2001 to 78,000 tons in 2002, equivalent to a decrease of 18 percent.  There was no change in the volume of pyrethrum produced.  Following table shows cash crops production in 2001 – 2002.

CASH CROPS PRODUCTION IN 2001 – 2002 (TONS) 

LIVESTOCK

Tanzania is estimated to have 17.7 million cattle, 12.5 million goats, 3.5 million sheep, 47.0 million poultry and 880,000 pigs.  During 2002, some of the measures undertaken to improve livestock production in order for the products to be competitive in both local and external markets included the following: production of 62,852 doses of improved cattle breed; insemination of 48,950 cattle; distributing 3010 heifers; establishment of production and processing groups; construction of 152 dams in 14 regions including 43 districts; construction of 20 livestock night camps and 3 railway sidings; rehabilitation of 10 livestock railway wagons; and promotion of increased consumption of livestock products nationally.

During 2002, production of livestock products was as follows: meat, from 323,100 tons during 2001 to 332,000 tons, equivalent to an increase of 2.7 per cent; milk from 814 million litres to 900.5 million litres, an increase of 10.6 per cent; and eggs from 600 million to 650 million, equivalent to an increase of 8.3 percent.  Increased production and efficiency resulted from the availability of adequate pasture, water and efficiency in collection, and processing, as well as an expanded domestic market of livestock products.  Table No. 11.3 shows production of livestock and poultry products from 1999/00 – 2001/02.

PRODUCTION OF LIVESTOCK AND POULTRY PRODUCTS  (FROM 1999/00 TO 2001/02)  

  Source: National Bureau of Statistics                                                                        

EXTENSION SERVICES AND TRAINING

Between 2001 and 2002, a total of 65,000 farmers and livestock keepers were trained on best practices in agriculture and livestock at training institutes, through the support of the National Agricultural Extension Programme Phase II (NAEP). Likewise, 1,047 extension staff attended courses on participatory approach. Curricula for agriculture and livestock training institutes were reviewed in order to incorporate environment conservation and management, HIV/AIDS education, commercial agriculture and livestock production in order to enable the graduates to be self-employed.    

Various approaches were developed and applied by extension officers to disseminate appropriate messages to farmers including demonstrations, farm/field education and participatory approach which proved to be successful in Dodoma, Morogoro and Kagera regions.   During 2002, a total of 50 trainers from the Training of Trainers program, completed the course and were posted in 21 regions and training manuals were also prepared. The participatory approach and on-the-field training was adopted for training purposes. During 2002, the participatory approach training courses were attended by 405 extension officers, 880 farmers and 575 livestock keepers.

RESEARCH

In 2002, research activities focused on producing high yielding, drought and disease resistant seed varieties. In conducting the research, a participatory approach was adopted,  focusing on stakeholders demand in zones or special areas which contributed in financing specific research. Published research findings during the year included the availability of new seeds for maize, beans, millet, cotton and wheat, improved cattle and diary goat breeds, and improved poultry. Efforts were also directed towards the eradication of tsetse flies and the establishment of an early warning system in ensuring the availability of pasture. Cash crops research institutions continued to restructure their operational system in order to strengthen themselves.

INPUTS FUND

In  2002, the Agricultural Input Trust Fund extended credit worth shs. 1.2 billion, out of the budgeted shs. 1.5 billion, while the Private Agriculture Sector Support Fund provided shs. 2.2 billion, out of which shs. 1.8 billion and shs. 0.4 billion were for procurement and distribution of inputs  and investment capital purposes, respectively.

COOPERATIVE UNIONS AND MARKETING

During 2002, there was a four tier co-operatives structure, consisting of 4,778 primary societies with total of 644,796 members, 48 co-operative unions, 4 apex co-operatives, and one federation of co-operative unions.  During the same period, there were 123 Savings and Credit Co-operative Societies (SACCOS) with shares and deposits valued at shs. 7.6 billion and shs. 11.4 billion respectively.  Comparatively during 2001, there were 4,743 primary societies with 616,824 members and 927 SACCOS with 133,100 members and shares worth shs. 6.6 billion and deposits valued at shs. 8.6 billion. Improvements during 2002 resulted from government efforts in promoting the development of co-operatives among communities and the general public in the areas of  production, distribution, marketing, storage, packaging and processing, in order to improve production regional and international markets, as well contribute in the alleviation of unemployment and poverty reduction.

AVAILABILITY OF CREDITS FOR CROPS PURCHASES AND INPUTS PROCUREMENT

The Kilimanjaro Cooperative Bank and Kagera Farmers Cooperative Bank extended credit of low interest rate to cooperative unions and private sector for crops purchases and input procurement. The Bank offered  credit amounting to shs. 5.00 billion to co-operative unions and shs. 7.97 billion. to private sector in 2001 compared to shs. 8.81 billion extended to the private sector in  2002. The Kagera Farmers Co-operative Bank channelled credit to the private sector amounting to sh. 11.0 billion in 2002. Other alternatives used to secure credit for exporters were through Export Credit Guarantee Scheme which availed shs. 11.66 billion channelled through CRDB (1996) to the following co-operative unions Nyanza Cooperative Union, Shinyanga Cooperative Union, Karagwe Cooperative Union, Biharamulo Cooperative Union, Arusha Cooperative Union, Kilimanjaro Native Cooperative Union, ISAYULA co-operative Union and Mbozi Cooperative Union. Contract farming between farmers and companies extending credits for agricultural inputs, capital and ensuring the availability of markets was used in sugarcane production and wheat farming in Manyara region. 

CROPS MARKETING

In 2002, efforts were directed towards the preparation of the Marketing Development Policy for agricultural and livestock products and establishment of the Marketing Development Centre which will advise on prices, packaging, quality control and standards and availability of markets. Participation in various fairs including Nane Nane in 2002 provided an avenue for farmers, livestock keepers and traders to observe and learn on crops available, produced and types of inputs used in the country. Price trends for some crops were as follows: beans decreased from shs. 34,700 in 2001 to shs. 31,500 for 100 kilograms in 2002; rice decreased from shs. 29,576 to shs. 27,439 in 2002 for 100 kilograms; and maize increased from shs. 8,120 in 2001 to shs. 9,653 in 2002 for 100 kilograms. For cash crops, prices were generally favourable in 2002 compared to 2001. Prices of a one kilogram of tobacco increased to shs. 567 in 2002 compared to shs. 526.8 in 2001; a kilogram of cotton was shs. 200 in  2002 from  shs. 180 in  2001; and a kilogram of cashewnuts was shs. 360 in 2002 compared to shs. 350 in 2001. Price for coffee declined Price for coffee declined from shs. 600 per kilogram in 2001 to shs. 450 in 2002.

Source : Economic Survey 2002,Tanzania