Challenges, Issues and Strategies

for the Future

Summary from Group Deliberations

David Nyameino Cereal Growers Association Kenya

Talk does not cook rice

Chinese proverb

A Promise is a Cloud – Fulfillment is Rain

Arabian Proverb

Rising food and wheat prices have two implications

++ Africa wheat production is becoming profitable in many areas and could contribute to food security, income generation and reducing import bills

--- Urban social unrest in Africa due to high price increases of staples food more likely

Red dashed vertical lines correspond to beginning dates of “food riots” and protests associated with overall death toll reported in parentheses

Global Food Security Food Prices and Social Unrest

Source: Weigand, US Wheat Associates, 2011

0

5

10

15

Imp

ort

bill

(bill

ion d

olla

rs)

1960 1970 1980 1990 2000 2010Year

Source: Prepared by authors based on FAOSTAT database.

1961-2010

Trends in wheat import bills for Africa

Area under wheat in Africa (million ha), 1961 - 2010

South Africa

Morocco

Algeria

Tunisia

Ethiopia

Egypt

Wheat production in Africa (million tons), 1961 - 2010

Algeria

Egypt

Ethiopia

Morocco South Africa

.5

1

1.5

2

2.5

3

Ton

s/h

ecta

re

1960 1970 1980 1990 2000 2010Year

Eastern Africa Middle Africa

Northern Africa Southern Africa

Western Africa

Source: Prepared by authors based on FAOSTAT database.

(1961-2010)

Trends in wheat yield for different regions in Africa

- Wheat is mainly imported or produced on large scale farms (excl. Ethiopia) - Current situation does not generate rural-urban synergies on large scale N. Mason, MSU, Addis Ababa, Oct 8, 2012

Professor Tim Lang, professor of Food Policy at London City University: "Most analysts think the long drop in food prices, of affordability, is over. We are now in a new world, a world of new fundamentals, not just bad weather this year but a long-term squeeze."

The time of cheap food is over!

What are the issues for Africa?

What are the issues for Africa?

Develop adapted technologies and varieties for smallholder s

Make affordable inputs available

Build effective and sustainable wheat seed systems

Increase productivity among smallholders

Make wheat extension systems more effective and efficient

Make wheat more competitive and profitable

Make wheat value chains work more effectively

Foster regional co-operation

Develop policies that foster wheat industry

Wheat market issues

Market participation increases with adoption of new varieties

Farmers lack market information on value chain opportunities

Domestic prices are often negatively affected downwards by subsidized imports and unpredictable Govt interventions

There is no clear policy on price support or price stabilization to protect domestic producers and consumers

Grain quality needs to be addressed

It is very easy to state where we need “more”

More investment in research and development …

More research infrastructure …

More variety development …

More agricultural extensions & extension staff

More capacity building of research & extension …

More affordable inputs …

More quality assurance in seed, fertilizers, ag. chemicals, machinery

More farmer associations and farmer training …

More machinery and small farm implements …

More storage …

More awareness and support …

We want to take collective action and work with/through centers of excellency

We want to focus our investment and reach farmers in areas where wheat has the greatest profitability

We want to find approaches that makes wheat a profitable (cash) crop for more smallholders

We want to stimulate and support private sector investment for improved input availability, …

Accelerate information transfer through extension and mobile phones

This meeting thought about what we could do differently

Key Strategies / Investments

Key strategies are/Focus for investment should be on - 1

1. Develop wheat value chains into distinct geographic areas/

hubs with greatest profitability

2. In those areas/hubs, provide affordable credit and inputs, information, know-how, mechanization, organization and marketing in a comprehensive manner

3. In those areas, hubs involve smallholders that want to enter into profitable wheat production

4. Close the on-farm productivity gaps with existing wheat producers => Farm productivity can be enhanced (average yield in Africa 2 t/ha; global average 3t/ha)

Key strategies are/Focus for investment should be on - 2

Land consolidation and farmer aggregation for

– Economies of scale

– Appropriate mechanization through local entreprenuers

– Post harvest losses / storage

– “Fair” value chain and reduced transaction costs

Investigate and address industry concerns as they relate to storage, processing and grain quality

Key strategies are/Focus for investment should be on - 3

Effectively use the national, regional and international

capacities/centers of excellence and exploit economies of scale

– Strengthen strategic research at centers of excellence that serve a minimum area of 500,000 ha / a minimum production volume of 1 million tons

– Adaptive research at national level

Establish an Africa wide concept for interaction among wheat research institutes

What can policy makers do?

Put wheat on the agenda Africa’s Ministers of Agriculture Trade Meeting on 1-2 November, 2012.

Include wheat in strategic plans / fund allocation of donor / national governments to strengthen / develop wheat industry in Africa

Support approaches that reduce land fragmentation

Ensure that capital is being built among farmer, the private sector, research

Policy issues – More specific

Create space for public-private sector partnership and competitive private sector in the entire value chain

Promote private sector extension

Strengthen extension efforts to replace out-dated varieties

Provide limited time input subsidies to stimulate adoption of higher yielding varieties and agronomic practices

Target women and small-scale farmers in extension education

Protect domestic producers by better timing of food aid and imports

Provide price stabilization and price support for local producers

Invest in rural infrastructure (including roads and irrigation) and market information systems

Opportunity for Investment Funding

US$ 2 levy on every ton of wheat imported

Imports are known – collection easy

AU recommended to invest 10% of GDP in Agric R&D

Allocation of funds decided by wheat stakeholder committee (from farmers to processing industry)

US$ 2 = 0.5% of the import bill = $ 80 million

>> Available for wheat industry development

“Quote for Wheat in Africa”

If you want to walk fast – go alone

If you want to go far – go together

We need partnerships in the value chain

http://wheat.org