Organising smallholder farmers of rice in Tanzania has given good results. Productivity has increased, incomes have risen and production has become more environmentally friendly than previously. More and more small farmers appreciate that collaboration is sensible and yields results.
Cultivating rice is an important source of income for many Tanzanian farmers. A great challenge is that prices are at their lowest when the farmers harvest their crop to sell it to the buyers. The cause of the drop in price is that during the harvesting period the market is swamped by rice. The buyers themselves often have access to warehouses where they can keep the rice in order to sell it on when the price has risen. This system undermines the ability of smallholder farmers to make a living from cultivating rice.
About the project
In this project, Norges Vel wishes to contribute both to better crops, and cooperation and organization that gives small producers increased market power and increased profits.
At project establishment, we saw that the farmers needed to experience a rapid rise in profits if the project was to be sucsessfull. Dedicated storage facilities needed to be established in which the farmers could collectively store their rice until the sale price was more favourable. At the same time, it was essential that they should receive some sort of advance payment in anticipation of the rice being sold. It was also essential that the project should be locally rooted at government level. This was done by, amongst other things, renting unused government warehouses for the project.
Another core issue was the establishment of the organisation RUDI, the Rural Urban Development Initiative, to take responsibility for the actual organisation of the rice farmers. Norges Vel has collaborated with RUDI since 2007 .
Today, RUDI and RCT (Rice Council of Tanzania) are Norges Vel's partners in the rice project. The focus has changed from production to market. We are still working highly targeted with improved production, but the main focus is to establish two rice companies that will give more market power to rice producers.
Our contribution and role
- Project leadership and quality assurance A-Z
- Ensuring access to warehouses
- Securing farmers’ access to credit from local finance institutions in anticipation of selling the rice
- Securing market access and product development for the producers
- Ensuring climate-appropriate and sustainable rice production
- Provide training and advice in strategy, financial management and organisation
- Many producers have increased revenues after achieving an average of 25 percent increase in production
- 8 of 18 production businesses run their own mills and are able to sell processed rice at a higher price
- All producers have access to warehousing for the storage of rice in anticipation of more favourable market prices
- Strengthen skills in organisation, market awareness, product development and negotiations with buyers
- Collaboration with research organisations has led to a new business area for rice producers in terms of the production of bio-coal from rice husks
- A steadily increasing proportion of women is taking up leading positions in producer organisations
- Two rice companies is now established, and the rice producers will become owners of these companies