By ADAM IHUCHA -- IN a hidden corner of the far north of Tanzania near the
picturesque Kilimanjaro Mountain, a humble farmer lives with her family.
Yasintha Herman Mlale, 63, a mother of two, and her husband
Herman never dreamt of selling their avocado fruits beyond Sanya Juu Township
in Siha District, Kilimanjaro Region.
Thanks to Africado Company Limited’s initiative,
the family is now selling the fruits from its quarter of one-acre farm to as
far as the European market.
The once downtrodden fruits have, since
last year, been making the family laughing all the way to the bank as they earn
as much as Tsh 12.9 million ($7,588) from the crop in the first year of
harvesting.
"I first felt the direct benefit
last year when Africado started purchasing our avocadoes for export,” admits
Yasintha, adding that the profit enables her to meet basic needs.
Africado embarked on its mission of
distributing seedlings of a quality avocado variety and of replicating
technologies for small-scale farmers in 2010.
Its three-year painstaking work
prompted Yasintha’s family to increase avocado trees with a yielding capacity of
a carton a season from five to around 125 plants and harvest 215 cartons of
quality avocadoes for export.
“I expect to mint more money this
season, for the trees, which take three to five years to yield, keep on
producing more avocadoes than they did in the past,” Yasintha observes.
Now, avocado is slowly, but surely,
transforming the entire rural economy, as Yasintha is just one of thousands of
other smallholder farmers who are now responsible to produce 14 tonnes for
export market, earning them handsome money from zero.
Africado has pioneered
commercialisation of the Tanzania’s emerging export crop currently benefiting
nearly 2,500 smallholder farmers in Kilimanjaro and Arusha regions alone.
Their lives are better off today, as
they afford to pay fees for their schoolchildren, build modern houses and foot
healthcare bills -- one of the key challenges facing most rural dwellers.
Inception
It was a bright and sunny day in most
parts of the far north of Tanzania in 2007, yet the hostile weather didn’t stop
peasants from being preoccupied by the cultivation season.
The lush green fields, which spread over a vast expanse of
agriculture farms under the shadow of Mount Kilimanjaro, looked colourful
enough to draw the attention of an investor all the way from the UK.
At his early 40s, enthusiastic horticulturist, James
Parsons, resolved to move to Siha District in Kilimanjaro Region.
His dream was to grow avocado trees, whose crops were
virtually worthless to most of the natives of the Chagga land, save for few who
used them for feeding pigs.
Much as James eyes the European market in his dream, he
didn’t give up. And first Siha district commissioner Anna Nyamubi offered moral
support only to see him establish an Africado Company in the foreign land.
“When I first came here, my hosts thought I was a
crazy Mzungu-- European, but few years later I showed them where a
lucrative market for quality avocadoes was,” says James, explaining:
“I started growing the crop initially used for pigs’ feed
with the export market in mind.”
He is right, for as you read this article, the hass avocado variety as he
calls it is popular in the EU market where it competes with those from South
Africa, Israel, and the Southern American country of Peru.
If comments from consumers of the fruits are anything to go
by, the UK-based Supermarket Waitrose describes Africado’s avocadoes as bearing
characteristics that have never been tasted before.
Ian Daniels from Greensell in the UK writes: “The quality of
Africado fruits is far better off compared to the South African and Peruvian
fruits. They resemble those from Israel.”
The EU market’s preference and the
growing global demand for avocado oil have significantly pushed sales of the
fruits.
Africado is ideally positioned to seize
off-peak market opportunities available, as prices often appreciate when the
Chilean season begins, and those of the South African and Peruvian end.
The Africado's proximity to Mombasa
Port and competitive labour at its disposal make production, processing, and
export logistics of the fruits a profitable endeavor.
The Tanzanian product is, as a
result, fetching attractive prices, as it competes with others at the
international market.
Analysts say that by adding the substantial out-grower
component to the existing plantation-based commercial unit, the project
demonstrates rare mutual advantages and synergies of effective joint ventures
between smallholders and commercial farmers.
Africado is not only the pioneer
exporter from the remote district of Siha, but also the first firm to
successfully handle a complex logistical chain for exporting fresh fruits
directly to Europe by sea.
Multiplier
effects
Unlike in 2011 when it exported about
five tonnes of avocadoes, the firm anticipates shipping 1,360 tonnes this year.
“Fourteen out of the 1,360 tonnes
belong to 26 out-growers certified to meet the Global GAP requirements,” says
Africado Development Manager Duncan Page.
Plans are underway to certify 400 extra
farmers next year, Mr Page explains, adding that in the next three years, the
half of the Africado’s projected total export of 2,000 tonnes, will be sourced
from the out growers.
With 145 employees, mostly women,
Africado has also turned out to be the Siha’s biggest employer with massive
multiplier effects to the surrounding communities.
Having paid Tsh123.4 million ($72,588) last
year alone, Tanzania Revenue Authorities (TRA) in Hai District acknowledges the
company as its largest taxpayer.
“This certificate is awarded to
Africado Ltd of Siha as the first winner in recognition of the company’s
outstanding tax compliance in 2014,” a certificate of merit Hai TRA manager
Sylver Rutagwelera issued to Africado Ltd reads in part.
According to Rutagwelera, the firm is
recognised for tax compliance, transparency, timely payment, precise amount,
good communication and trustworthiness in documentation.
Motivated by the pat on the back,
Africado expanded its irrigation facilities, constructed a borehole and a water
reservoir, and increased the capacity of its nursery from 10,000 to 100,000
plants during the second phase of its project.
Almost 100 per cent of grafted plants
in the out-grower scheme now comes from the nursery on the nucleus farm.
The company has formed out-growers
groups mostly basing on redundant coffee cooperatives structures.
Gifted hands
James owes Tanzania Horticultural
Association (TAHA) the USAID/ Tanzania Agricultural Productivity Program (TAAP)
his appreciations for the overwhelmed support.
TAAP for instance, provides outgrower
farmers in partnership with Africado with technical advice and training,
subsidised avocado seedlings from the orchard, and transportation.
Africado, in turn, guarantees them all
with off-take of avocadoes at or above prevailing market prices for local
varieties.
For a produce meeting export quality
standards, a grower receives a premium of over 100 per cent three months after
delivery.
Sooner after establishing the company, James found himself
in quagmire, facing a number of hurdles in terms of unfriendly policy and
regulatory frameworks.
Thanks to the industry’s apex body -- (TAHA) and its
partners -- for chipping in.
TAHA mobilises and builds institutional
capacity and facilitates enabling environment and technical assistance.
“Without policy and regulatory support,
it is difficult for the private sector investments to prosper,” James admits.
He commends the associations for
working round the clock to maintain dialogue and good rapport with the
government.
TAHA Executive Director Jacqueline
Mkindi is proud of one of the success stories, which made the industry grow in
leaps and bounds in the span of 10 years of the association with her at the
helm.
“We have strived to assist peasants to
transact business with exporters in a win-win framework,” she explains; adding
that the industry now earns the country nearly $400 million annually, up from a
mere $63 million in 2002.
TAHA assists farmers to adopt standard
compliance practices and addresses challenges compounded by government’s
numerous taxes and levies, particularly the produce cess fee.
It also supports investors in
horticulture in the registration of essential horticultural inputs including pesticides,
fertilizers and biological control agents.
Through its logistic firm -- TAHA Fresh
Handling Ltd, the association absorbs costly and time-consuming cross-border
non-tariff barriers to ease the burdens investors face.
TAHA addresses policy and regulatory
hurdles for the industry to thrive. “I’m so grateful to the government for
listening to us whenever policy challenges emerge,” Ms Mkindi says.
Successfully persuading the government
to include essential agricultural inputs in the Value Added Tax exemption list
in the 2014 VAT Bill is the TAHA’s latest case in point.
The TAHA’s support does not only result
into avocadoes booming in the sprawling Kilimanjaro and its nearby Arusha
regions, but also flying the Tanzanian flag high in the international markets.
Africado today is just one of many other horticultural
investments enjoying positive support from the government.
As a result, besides offering reliable markets for fresh
produce to thousands of smallholder farmers, the companies also now transfer
crucial technologies required for boosting productivity.
Southern corridor
Rungwe Avocado Company, in Rungwe District, forms a good
example of commercial fruits production, packaging, processing and export
business model, which could be emulated towards development of commercial
production and export in fruits industry.
The company started in 2006, as pilot commercial
avocado production by Kipunji farm owned by Mr. Robert Clowes. It was formally
registered as a commercial avocado production and export company with a name of
Rungwe Avocado Company (RAC) in 2009.
Mr. Robert inspired other concurring companies and
engaged into partnership with Tanzania Tea Packers (TATEPA) and Wakulima Tea
Company.
In 2009, RAC started investment in development of
commercial production and packaging for export with a total capital of about $4.2
million.
It invested in establishment of a pack-house, which
coasted about $1,000,000. Other RAC’s investments, is a seedling nursery
to support avocado out-growers scheme, with Hass avocado variety for export
market.
To date, RAC is working with 4000 out-growers, who
have planted 600 hectares of avocadoes in the Rungwe and Busokelo Districts.
“Our plans is to replicate practical tested models
in Rungwe to the entire southern corridor mainly Iringa, Njombe and Mbeya,
where there is enormous potential to grow fruits and vegetables” TAHA’s boss
explains.
According to Ms
Mkindi, TAHA is currently engaging in the negotiating table with Southern
Agricultural Growth Corridor of Tanzania (SAGCOT) centre and the Ministry of
Agriculture, Food Security and Cooperatives to partner with a view of expanding
commercial production and infrastructure development in that corridor.
Tanzania’s Minister for agriculture, Food Security and
Cooperatives, Christopher Chizza admits that through TAHA the industry has been
the fastest growing sub-sector; recording an average growth of 11 per cent per
annum over the last six years.
Increasingly, horticulture has become the main driver
of agricultural development due to its nature as a commercial industry and the
growing demand for such products in the major markets in both within and
outside the country.
Indeed, the potentials for further growth are
enormous, especially due to the wide range of growing conditions that the country
possesses, positioning the country to produce and trade most of horticultural
crops throughout the year; and the increasing market opportunities at local,
regional and international levels.
Indeed, statistics from the United Nations Comtrade
assumption of projections speak volumes on horticulture potential.
With TAHA support, Tanzania's horticulture exports
would earn $1 billion in 2018 and double in two years' time to reach $1.9
billion by 2020.
The figure also suggests that
more than one million Tanzanians will be working directly in horticulture
industry by 2020.
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