Identifying export opportunities in agriculture inputs,implements

29 Aug, 2021 - 00:08 0 Views
Identifying export opportunities in agriculture inputs,implements

Trade Focus
Allan Majuru

The growing world population and changing climatic patterns have resulted in a major boost towards increased agricultural production across countries.

The fast-changing diets of developing countries have also changed the structure of the global agricultural systems and this has seen an increase in agricultural production in most parts of the world.

In fact, the need to be food sufficient has become a key strategy for growth in most third world countries, especially in Africa where economies that had not previously relied on agriculture are increasing investments into the sector.

In southern Africa for example, countries such as Botswana and Angola have introduced some measures to diversify their economies from dependency on the volatile mining sector to developing the agriculture sector, which is considered to be more sustainable.

In the Democratic Republic of Congo (DRC), activities in the agriculture sector have been concentrated on commercialisation and modernising farming activities.

For Malawi, the thrust is sustainably growing the agriculture sector to spur the economic growth of the country and this will be achieved through mechanising the sector.

In Tanzania, there is a special focus on bringing in new seed varieties that can perform well in the rapidly changing climatic conditions that are not easily destroyed by pests and other diseases.

Improving commercial farming is the current focus in Mozambique’s agriculture sector, which has been identified as a key driver for economic growth.

From all these developments in countries in the region, there is a realisation that appropriate and affordable agricultural inputs and implements made available to farmers will go a long way in increasing output in a short period of time.

For Zimbabwe, whose agriculture sector is better developed compared to other countries in the region, there are opportunities for local companies to supply different inputs and implements.

Increased export of these products will undoubtedly go a long way in realising the 10 percent annual export growth stated in the National Export Strategy, launched by President Mnangagwa in 2019.

Global perspective on opportunities

As the world’s food production system has become more interdependent, trade in agricultural inputs and implements has grown tremendously.

The expansion of the global food market has resulted in a reshuffling of resources over the entire globe, providing food and export opportunities where they may have been previously limited, unavailable, or untenable.

This may be supported by the fact that exports of agro-based products grew from US$772 million in 2016 to US$884 million in 2020, according to Trade Map.

Trade expansion in agricultural commodities and food products has been accompanied by significant increases in demand for agricultural inputs, such as fertilisers, pesticides, farm machinery, feedstuffs, and genetic material.

From this demand, more countries have opened their markets, making it easy to trade in agricultural inputs and implements in the quest to enhance food security.

Although Africa has one of the lowest trade statistics for agricultural inputs, there is potential for the expansion of food production as the use of agricultural inputs and implements is still low and insignificant.

Thus, there is potential for Zimbabwean exporters to tap into the space and become leading suppliers across the continent.

African countries, excluding Zimbabwe, imported agricultural, horticultural or forestry machinery for soil preparation or cultivation worth US$375 million in 2020 with the largest importers being Nigeria (US$159 million), South Africa (US$49 million) and Sudan (US$19 million).

Of this import value in Africa, Zimbabwe exported agricultural, horticultural or forestry machinery for soil preparation/cultivation worth US$1, 1 million, according to Trade Map.

The exports were concentrated in Zambia, Botswana, South Africa, Namibia, and Malawi.

Zambia, which ranked tops amongst these five countries, imported ploughs for use in agriculture, horticulture, or forestry worth US$321 000 in 2020.

Although these figures may seem low, they are indicative of the potential for Zimbabwe to supply required products and exports will grow if local production of the inputs and implements grows.

Opportunities in the region

Market surveys conducted by ZimTrade, the national trade development and promotion organisation, in the past few years have revealed export opportunities for agricultural inputs and implements in countries such as Tanzania, Malawi, Botswana, Mozambique, DRC, and Angola.

The Tanzanian agriculture sector is going through a commercialisation process and this presents opportunities to supply a wide range of inputs and implements.

Currently, farming is conducted mostly by smallholder farmers and the growth in agriculture has been through consolidation of their output.

Seeds such as maize are not being produced by large commercial enterprises and the country is importing most of its requirements.

In Rwanda, the agriculture sector is being prioritised as one of the key drivers of economic growth.

Smallholder farming forms the baseline of agriculture and is receiving support through government and private players.

Farming skills are limited, and knowledge-sharing and skills development is required to improve their farming techniques.

Inputs such as fertilisers, as well as maize and soya to supplement local production, are being imported from Tanzania or DRC.

This offers numerous opportunities for Zimbabwean producers who can offer competitive prices and supply quality products.

With regards to the DRC, farming has been largely subsistence, as such most of it is not mechanised.

Most of the agricultural output originates from the rural smallholder farmers.

This has created a need for appropriate technology in the agriculture value chain.

Required products include hand-held farming equipment, tractors, cultivators, and planters.

Most smallholder farmers in the DRC do not have livestock such as cattle or donkeys to provide animal-drawn implements.

In Mozambique, farming is mainly communal and subsistence.

The farmers are faced with severe post-harvest losses, and most of them do not use fertilisers and other chemicals.

There is a lack of extension services and knowledge, and skills are still limited.

Distribution of inputs is fragmented as the retail structures are not well established compared to other sectors.

All these challenges offer opportunities for Zimbabwean businesses.

There is growing demand for various products ranging from crop chemicals, fertilisers, veterinary products, seeds, protective clothing and other agricultural inputs.

There is potential for Zimbabwean companies to embark on seed production and supply the market with other seed varieties.

Since the greater part of farmers in Mozambique are based in the rural areas, hand tools (hoes, ploughs, cultivators) as well as ox-drawn implements have great potential.

For Botswana, the Government has increased investment in the agriculture sector in a bid to improve food security and diversify the economy.

Efforts have gone towards commercialisation and modernisation of the sector and there are opportunities to supply animal health products, seeds, agriculture chemicals and implements that are customised to Botswana’s environment.

 Allan Majuru is the ZimTrade chief executive.


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