Smallholder cereal farmers are fast becoming commercial producers thanks to beer brewer, Serengeti Breweries Limited whose agribusiness project has supported them for the past five years.
According to the Wikipedia, the custodians of agribusiness are ‘groups of industries dealing with agricultural produce and services required in farming-including agro-chemicals, crop production, distribution, farm machinery, processing, seed supply as well as marketing and retail sales.’
SBL’s agribusiness program involves hundreds of farmers from various parts of the country and has the objective of propping up farmers to boost their production while offering a reliable market for their commodities.
Currently, over 400 farmers are participating in SBL’s agribusiness value chain in which the beer-maker also provides farm inputs such as fertilizer, quality seeds, technical agronomy support and links them to financial institutions to acquire loans.
By investing in agriculture, the company not only readily acquires locally-available raw materials but also contributes in proving food security in the country while promoting sustainability needed for the country’s economic development.
The brewer’s Corporate Relations Director, John Wanyancha said last year alone, the company sourced 17,000 metric tons of grains locally or an equivalent of 70 percent of its annual raw materials requirement.
A recent report by Deloitte that studied the impact of SBL on Tanzania’s economy, said the company is at the forefront in supporting small businesses because of the 400 farmers involved in its agribusiness value chain. “’82 percent are small-scale farmers while eight percent are medium-scale. The remaining 10 percent of purchases are sourced from large and extra-large scale farms, which provide the largest contribution in terms of hired labor,” the report noted.
The Deloitte report quoted Director of Crop Development at Ministry of Agriculture saying that SBL has been working closely with the ministry of agriculture to improve growth of the agricultural sector.
“SBL creates a ready market for farmers’ crops through contract farming arrangements, thereby stimulating rapid growth of the country’s agricultural sector,” said the report, adding: “It has been one of the key stakeholders that has helped to enhance production in Tanzania through donations to the Ministry of Agriculture aimed at assisting farmers to maximize the benefits from their businesses.”
The report further noted that SBL participates in agricultural exhibitions such as the annual Farmers’ Day (Nane Nane) which this year was held at Nyakabindi Grounds in Bariadi District of Simiyu Region where the brewer showcased various activities relating to modern agriculture value chain and opportunities available to farmers.
Initiatives such as contract farming have meant that SBL’s agribusiness program has made notable differences such as enabling smallholder farmers to mechanize compared to peers who are not involved. Contract farming also enables smallholder farmers earn additional income which encourages them to increase production because of improved market access.
“Beneficiaries of SBL’s agribusiness project have indicated that the company’s support has simplified their farming, and improved their social and economic wellbeing, enabling them to pay school fees for their children as well as providing a stable income,” the Deloitte report stated.
An average farmer in SBL’s value chain can expect to earn a higher income from producing raw materials than he might otherwise receive at the prevailing local market prices which also translates into improved standards of living for the farmers and their families.
SBL investment in sustainable agriculture in Tanzania therefore supports wider strategic goals of the government to reduce rural poverty and enhance economic growth through modernization of agriculture.
According to Food and Agricultural Organization (FAO), over 70 percent of the world’s food needs are met by farmers. The FAO report added that the agri-economic sector employs the most people in the world and it’s the main source of food for millions of people living in poverty.
The SBL project also contributes directly in achieving United Nations Sustainable Development Goals of which Goal-2 seeks to ‘end hunger, achieve food security and improve nutrition and promote sustainable agriculture.’
Tellingly, policies, incentives and regulatory frameworks that safeguard and promote agro-industries have proven to be highly effective at lifting rural populations out of poverty because they more than double agricultural productivity and incomes of small-scale food producers, most of whom live in the rural areas, the FAO report added.
