KAGERA regionhas a great business opportunity to boost production of edible oil crops, including sunflower, oil palm, sesame and canola. Edible oil crops such as sunflower, oil palm, sesame, groundnuts, avocado and canola are some of the fastest-growing agricultural sectors for investment at global scale.
Demand for edible oil currently locally and according to neighboring countries indicate a hugegap,which is an opportunity for production. The oil crops are vital commoditiesin the trade and commerce of many economies globally.
The region is endowed with plentiful economic opportunities based on its geographical location. The region shares borders with four East African Community (EAC) member nationsRwanda, Burundi, Uganda and Kenya across Lake Victoria. The region is also a gateway to South Sudan.
The region is characterized by equatorial climatewith bimodal rainfall patterns per year and thus allows more than three crops growing per year. It has a land area that covers 40,838 sq km, of which 28,953 sq km is landmass and 11,885 sq km is water bodies, including Lake Victoria and 14 satellite lakes, Kagera and Ngono rivers, forests and biodiversity.
For many decades, farmers in the region had been producing coffee as their main cash crop, producing between 60,000 to 70,000 tonnes, which amounts to 50 per cent of the total coffee production in Tanzania. The agricultural sector employs over 76 per cent of the region’s population.
According to the 2012 Population and Housing Census projections, the region’s population stood at 3.2 million.
The government has shown increasing interest in bio-fuels in general and oil palm specifically in an effort to steel its economy against the effects of rising fuel prices and help it move toward energy self-sufficiency.
During his recent tour in the region, Agriculture Minister, Hussein Bashe announced that the government had set aside 20bn/- for the production of palm oil, while the government would buy the seeds and distribute them to the farmers.
Five regions have been listed for palm oil production, including Katavi, Kagera, Kigoma, Tabora and Coast. Kagera Regional Commissioner (RC), Albert Chalamila challenged leaders in the eight councils, namely Muleba, Bukoba DC, Biharamulo, Ngara, Karagwe, Kyerwa, Missenyi and Bukoba MC to encourage members of the public to invest in strategic projects, including palm oil, while revealing that under the programme, the region has set aside about 70,000 hectares for palm oil production. He said officials must initiateand come up with projects that would transform to increase production.
President Samia Suluhu Hassan has been keen to improve the agricultural sector as the government increased the agricultural budget from 294bn/- during 2020/2021 season to 954bn/- during 2022/2023 financial year.
Tanzania produces about 290,000 metric tonnes of edible oil a year, which is not enough to meet its current annual demand of 650,000 MT and is compelled to spend over 200 million US dollars annually for import to cover the shortage.
Oil seed crops act as a powerful tool in smallholder farming that can contribute significantly to livelihoods, improved health and nutrition, household food security, and ecological sustainability income growth, poverty alleviation and employment generation.
Edible oil imports account for 34 per cent of the growth in food imports in Africa, of which palm oil contributes 65 per cent of all imports in the continent.
In the East African Community (EAC) nations, the edible oil imports exceed 1 billion US dollars. The government has been encouraging the agronomy of modern palm trees, the use of quality and friendly processing technologies to obtain quality products. Palm oil is the cheapest edible oil rich in antioxidants and growing in demand globally.
The Ministry for Agriculture reports that edible oil imports account for 34 per cent of the growth in food imports in Africa, while palm oil accounts for about 65 per cent of all edible oil imports to the continent.
The demand for seed cake increases at an average annual growth rate of 117 per cent in the East African Community (EAC)region.
Oil palm has been chosen as it is ideal for commercial agriculture thus supporting “Kilimo Kwanza”, which is Tanzania’s campaign to advance the country’s agriculture sector, which is responsible for more than a quarter of the nation’s economy. The oil seed crops are alternative processing crops with price stability, high demand elasticity and low substitutability to moderate prevailing instability in earnings from coffee and banana crops.
Crop diversification will shape a strategy to deal with climate change variability by increasing a range offood and cash crops, that enhances productivity, encourages youth self-employment and incomes generation along the value chain in Kagera region. The business potential for edible oil is thus clear because there is an opportunity for import substitution.
Accessing raw materials will enable productive, sustainable production to reduce imports of edible oil.
