Public-Private Sector Models for Mechanization in SSA
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1 Public-Private Sector Models for Mechanization in SSA Workshop on Boosting Agricultural Mechanization of Rice Cropping System in Sub-Saharan Africa St. Louis 6-8 June, 2011 Dr. Kunihiro TOKIDA Senior Advisor, JICA
2 Current Situation of Agricultural Mechanization in SSA Delayed tractorization: 2/1000ha in 1980s 1.3/1000ha in 2003 Stagnated diffusion of Animal Draft Power Increased importation of low-cost tractors from India and China Very limited knockdown production Limited local production of small machines and implements
3 Movement of Agricultural Mechanization
4 Issues on African Agricultural Mechanization No programs based on clear mechanization policy and strategy High local production cost due to imported materials Public led mechanization No scale merit due to too many brands with small volume (scattered customers and small market) Unstable spare parts supply and post sales service Very limited human resources for mechanization promotion No international commitment to assist mechanization Private-Public Sector Model Balance of importation and domestic production Support for farmers when purchasing machinery Custom hiring business model Risks: Continuous economic growth? Maintenance of crop price at higher level Political stability Effect of climate change
5 QUESTIONNAIRE TO CARD GM III PARTICIPANTS (May 2010) Purpose 1. Mechanization situation 2. Problems and issues 3. Prospects on agricultural mechanization *Limited analysis due to partial respondents
6 National Strategy for Agricultural Mechanization Country Year Effect. Issues Kenya 1994 No No political commitment Ghana 2008 No Implementation plan needed Tanzania 2006 On going Cameroon 2010 Not yet Rwanda - Drafted Benin 2008 On going Central Africa 2000 On going Core d Ivoire 2006 On going Uganda 2008 No Draft only Sierra Leone 2006 No To be implemented
7 Incentives for Mechanization Country Kenya Burkina Faso Tanzania Rwanda Benin Cote d Ivoire Sierra Leone Incentives Import tariff exemption Existing (not specified) 20-50% shared by farmers Import tariff exemption, 50% purchase subsidy 50% purchase subsidy 5 year loan 50% purchase subsidy
8 Local Production of Farm Machinery and Implements Country Impleme nts Animal D P Equipment Thres hers Kenya Uganda Tanzania Rwanda Madagascar Rice mills Cameroon Togo Benin Central A.
9 Tractor Hiring Services Major Existing Terminated Country Govern ment Issues, Reasons of termination Private Sector Kenya Uganda Poor management Tanzania Poor management Cameroon Economic crisis Rwanda Small scale Benin Poor maintenance Madagascar Low efficiency Zambia Privatization Gambia Small number, Frequent troubles Sierra Leone
10 Rice Mills (for selected countries) Gov. Private Private Major problems Large Small Kenya Low quality Madagascar Small trade, Obsolete Tanzania Poor quality, Poor maintenance Gambia Low quality Rwanda Benin Central Africa Low quality, Spare parts Cote D Ivoire Small trade, Low quality Uganda Small trade, Low efficiency Sierra Leone Low efficiency
11 Can Small Agricultural Mechanization Model in Asia Work in Africa? Can African individual farmers own small tractors? YES-13 NO-3 Reasons for NO Ghana: Too much initial investment Zambia: Not suitable for large farm land Gambia: Too small land holdings
12 What is the mainstream of mechanization in Africa in 2050? Country Owning Owning Hiring Hiring Large Small Large Small Kenya ADP Ghana Tanzania Cameroon Rwanda Benin Central Africa Cote d Ivoire Zambia Burkina Faso
13 Scenario on Rice Mechanization in SSA Large rice mechanization in Large scale irrigation projects considering rice value chain Small rice mechanization in community irrigation Higher utilization of machinery in upland farming systems Increased number of private custom hiring service Increased machine ownership by individual farmers Increase in small machinery ownership by nonagricultural income increase Mechanization by imported machines Mechanization by locally produced machinery
14 Mr. Gideon Gitungo Kingangi Hire service, Tour van operator Machine ownership Down payment 30%, 2year loan Interest rate15% CASE JX80 WD (2009) 3.4mill. shs Disc Plow 3x66cm 0.4mill. shs Disc Harrow 24x56cm 0.4mill. shs MF Service fee Disc Plow 2000Kshs/acre Disc Harrow 1000Kshs/acre 10acre/day x 25days/mo x 10 mo/year x 2,000shs =5,000,000/year Major cost Fuel 600shs/acre x 10acre/day x 250days = 1,500,000 R&M 500,000Kshs/year Operator 5,000,000 x 10% = 500,000 +food+hotel
15 Pattern of Agricultural Mechanization
16 Alternatives for Mechanization in SSA Strategic Agricultural Mechanization Plan, Feasible SSA mechanization model Promotion of agricultural mechanization using imported machines Purchase promotion (Warranty, Low tariff, Credit, Purchase subsidy, O&M training service, etc) Promotion of service providers (Loan availability, Hiring entrepreneur support, Mechanic training, etc.) Dealer support (Warranty, Spare parts supply, Preventive maintenance, Loan availability, etc.) Elimination of poor quality machines Promotion of locally produced machines Human resource development for research and development Promotion of local manufacturers (Loan availability, Government purchase, PPP, etc.) Sales promotion of locally produced machines (Purchase subsidy, O&M training service, etc.) Dealer support (Networking, Micro credit, etc.) Farmer support (Extension officer, Farmer group, Operator instruction, etc.)
17 Enabling Environment for PPP in SSA Government commitment with clear mechanization policy and strategy with concerned ministries Direct public investment that does not disturb private investment Available human resources Reduction of business risks Business system for sustainable agricultural inputs Protection of investors Tariff reduction Cost reduction Creation of mechanization demand Protection of customers Financial support and purchase subsidies
18 Mechanism to Promote Hire Service for Smallholders
19 Development Stages of Agricultural Mechanization
20 Japan s Possible Priority Actions for Rice Mechanization in SSA Group training on mechanization for CARD target countries Experts to support formulation of mechanization strategy Technical assistance to make a custom hiring business model Program support using KRII Technical assistance for appropriate machinery development Capacity building for research and development, testing Training of extension officers as mechanization promoters Promotion of PPP
21 GRiSP proposal Theme 3: Increasing the productivity, sustainability, and resilience of rice-based production systems Product Line 3.1. Innovative technologies for an ecological intensification of rice production systems under current and future climates Mechanization and agronomic options to increase energy and labor efficiency M (2011) Mechanization options for rainfed lowland systems introduced and evaluated in representative farming communities in Togo and Benin M (2012) New prototype crop establishment and weed control strategies for dry-seeded seeded systems M (2013) Mechanized minimum and zero-till systems for ricewheat/maize/pulses/potato cropping systems M (2014) Mechanization options for rainfed lowland and upland systems evaluated in farming communities in at least 4 countries in WCA Key Innovations: small-scale mechanization of rice production system in Africa
22 GRiSP proposal Theme 4: Extracting more value from rice harvests through improved processing and market systems and new products R&D Product Line: 4.1. Technologies and business models to improve rice postharvest practices, processing, and marketing Improved technologies and management options to increase postharvest yield M (2012) Africa: Adapted, locally manufactured mechanization options (mini-combine harvesters, dryers, storage systems) Theme 6: logical framework: Supporting the growth of the global rice sector R&D Product Line: 6.3. Effective systems for large-scale adoption of rice technologies in Africa New platforms for delivering agronomic, postharvest and processing innovations M (2015) Public-private sector partnerships to stimulate mechanization of the rice sector established in at least 4 countries in SSA
23 For a better tomorrow for all
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