EABC enhances agri-business in contract farming

THE East African Business Council (EABC), in collaboration with TAHA and GIZ Sequa GmbH through the Business Scouts Fund, has strengthened 35 agri-businesses in contract farming.

This initiative is a part of the EABC-GIZ Sequa GmbH project, “Enhancing Competitiveness of the Agri-food Industry and Mitigating the Impact of Global Crises to Improve Food Security in the EAC.”

Speaking during the workshop inaugural session here midweek, EABC Manager of Policy and Standards, Mr Frank Dafa, highlighted how global crises, including COVID-19, Climate Change, and the Russia-Ukraine conflict, have disrupted global supply chains, leading to increased inflation.

“This disruption has particularly affected Africa, a net cereal food importer, putting food security at risk” he said

Mr Dafa further discussed the EABC-GIZ Business Scouts study on Investment Opportunities in the EAC Agriculture Value Chain.

He emphasized the EAC’s potential to produce various agricultural products, including wheat grain, edible oil, leguminous plants, root tubers, and fertilizer.

Through the EABC-GIZ Sequa GmbH project, the aim is to enhance the skills and capacity of agri-actors in contract farming and EAC export procedures to increase agricultural productivity and market access.

Contract farming offers numerous benefits, such as expanded market access, improved production practices, risk-sharing mechanisms, and income stability for farmers.

For her part, Arusha based women farmers group Chairperson, Ms Martha Ndelekwa, expressed her optimism about the contract farming training, stating it would enable her group to negotiate fair and mutually beneficial contracts with green pea buyers.

The capacity-building workshop has equipped agri-actors, including farmers, processors, and buyers, with the knowledge and skills required for effective engagement in contract farming.

Discussions covered various aspects, including equitable contract negotiations, understanding the rights and responsibilities of each party, quality control management, pricing mechanisms, and dispute resolution.

The EAC economies with the highest economies of scale in the agricultural sectors include animal and animal products, dairy products, cereals, and food preparations.

However, the EAC Aggregated Agricultural Intra-Industry Trade index declined from 0.92 in 2021 to 0.52 in 2022 due to a drop in the trade of grains, oilseeds, fats, and oils caused by global shocks.