Agriculture and livelihoods in East Africa:An overview from an economics perspective
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Agriculture and livelihoods in East Africa:An overview from an economics perspective

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Challenges in Eastern Africa,Impact of CMD and bxw,Cassava processing business in Tanzania,C3P: Diseases, food security and GIS,Other activities (CIALCA, impact in WA, agronomy),Activities in the......

Challenges in Eastern Africa,Impact of CMD and bxw,Cassava processing business in Tanzania,C3P: Diseases, food security and GIS,Other activities (CIALCA, impact in WA, agronomy),Activities in the coming years

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  • 1. Agriculture and livelihoods in East Africa:An overview from an economics perspective Steffen Abele April 2, 2008 IITA Headquarters, Ibadan, Nigeria International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 2. Contents • Challenges in Eastern Africa • Food security • Agricultural commercialization • Pests and diseases • Impact of CMD and bxw • CMD adoption study in Uganda • Bxw impact study Uganda • Cassava processing business in Tanzania • C3P: Diseases, food security and GIS • Other activities (CIALCA, impact in WA, agronomy) • Outlook: Activities in the coming years International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 3. Challenges Food securityin Eastern Three categories of countries in Eastern AfricaAfrica Stably food secure (>2,100 kcal/cap/day): Uganda (2,360) Food secure but unstable (around 2,100 kcal/cap/day and slightly below): Rwanda (2,100), Kenya (1,880), Tanzania (1,960) Food insecure (significantly below 2,100 Kcal/cap/day): Burundi (1,700), DRC (1,600) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 4. Challenges Commercializationin Eastern Increase in cassava market (raw andAfrica processed) from 2005-2010: Uganda: 11 %, Tanzania 48 % 1 million mt required for cassava processing in Uganda and Tanzania by 2010 10-15 % of the population could benefit from cassava commercialization (raw and processed) in Uganda and Tanzania International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 5. Challenges Pests and diseasesin Eastern Banana xanthomonas wilt:Africa 55 % production losses over a decade if uncontained, major outbreaks in Uganda and spreading westwards Cassava mosaic disease: Uganda and Western Kenya: CMD outbreak in late eighties/early nineties with 80 percent production losses, CMD spreading further south-west CBSD: Recent outbreaks, similar threats International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 6. Variety Central Eastern Northern N.WesternAdoption of (% (%) (%) (%) farmerscassava adopting)varieties in NASE 1 6 6 6 3Uganda NASE 2 6 8 12 3 NASE 3 77 75 46 75 NASE 4 7 6 18 13 NASE 10 2 2 0 0 NASE 12 2 3 18 6 NASE 3 has in general lower yields than the other varieties, but dominates through short maturity periods, market demand and flour quality. Relatively lower cyanide content and limited use seem to be of a lesser influence International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 7. Determinants of speed of adoption ofAdoption of NASE 3cassava Variable Coefficient Std error Z statvarieties in Distance 0.00091 0.00077 1.19Uganda Age of Head -0.0076 0.0045 -1.69* Educ of Head 0.00085 0.00067 1.28 Farm size -0.010 0.028 -0.37 H/hold size -0.0034 0.0010 -3.37*** FT Labor -0.0030 0.0024 -1.23 No. of hoes 0.0024 0.00087 2.83*** Ext. advice -0.0038 0.0022 -1.72* Constant 4.36 0.33 13.00*** No. of obs = 216, LR chi2(8) = 26.20, Prob > chi2 = 0.0010, Pseudo R2 = 0.0158, Log likelihood = -813.58 International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 8. Price developments without and with bacterial wiltEx-ante 300impactassessment 250of bxw in 200Uganda Ugshs/kg matooke Baserun 150 Wilt 100 50 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Year International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 9. Potential economic losses through bxwEx-ante Total change Consumer welfare changes Producer welfare changesimpact 50,000,000assessment 0of bxw in 20 20 20 20 20 20 20 20 20 20 01 02 03 04 05 06 07 08 09 10 -50,000,000Uganda -100,000,000 US $ -150,000,000 -200,000,000 -250,000,000 -300,000,000 -350,000,000 Year International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 10. Ex-ante •Welfare losses of 200 million $ p.a. (about 3 % of GDP) – a serious threat to economicimpact growth (which is 7 % p.a.)assessmentof bxw in •Most of the losses on the consumer sideUganda •BXW is a macro-economic threat •Threat could easily scale out to Burundi, Rwanda, Eastern DRC – it becomes a regional threat with possibly similar effects International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 11. Business • Comparison of profits in the initial setupplanning stages of processing sites Zogowale Chisegu Mtimbwani Bungu (flour) (flour) (starch) (chips) Profits -1,640 1,876 6,448 2,212 International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 12. Business Bottlenecks to small scale businessesplanning • Low and erratic inflow of raw material (daily, seasonal) • Inefficient use of inputs (e.g. water), indicated by volatile costs per unit processed • Unstable demand at the beginning, project members as “brokers” • Difficult finance schemes (processors/farmers want cash transactions, clients want bank transactions) • Diseconomies of small scale (see next slide) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 13. • Economies of scale 1,200Business 1,000planning 800 Performance 600 400 200 0 Status quo Full press capacity Full grater capacity Full mill capacity Technology setup Investment (100 $) Fixed costs (100 $) Costs of production (100 $) Revenues (100 $) Profits (100 $) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 14. Businessplanning International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 15. C3P Objectives of the C3P food security assessment Link food security to crop diseases (bxw and CMD) Support GIS to target food insecure and disease threatened areas Support targeting across social strata Shed some light on the economics of food security Create tools that allow short term surveys on/assessments of food security (< 1 year) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 16. C3P International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 17. C3P International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 18. C3P International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 19. C3P International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 20. C3P International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 21. Validation of map indicatorsC3P Correlation coefficients Calorie production Maize equivalent of (significance levels) income Temporary and -0.452 -.179 permanent food (.000) (.109) insecurity Regression Coefficient t-value Significance level Variable Temporary and permanent DEP food-insecure people (%) Calorie production -0.00892 -4.452 .000 Income square -0.00183 -1.837 .070 Constant 65.93800 16.276 .000 Adj. R2 0.218, n = 81. Source: Own data International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 22. Factors determining food production and indicators for social targetingC3P Country Uganda Kenya Tanzania Burundi Rwanda DRC Variable Sign Sign Sign Sign Sign Sign (t-value) (t-value) (t-value) (t-value) (t-value) (t-value) EXP + + + + + + (2.10) (1.79) (2.13) (4.30) (11.31) (2.69) EXP2 - - - - - - (-1.97) (-1.86) (-1.95) -4.32 (-2.25) (-2.32) EDUCHEAD - + - + 0.003 + (-0.61) (1.85) (-1.03) 2.63 (0.16) (17.80) AGEHEAD - + - + + + (-0.41) (0.87) (-0.96) 4.11 (2.38) (14.60) HHSIZE -0.79 -0.73 - + (-1.53) (-0.23) -5.05 (0.88) CASSLOSS - - - - - - (-3.63) (-1.73) (-1.65) -2.06 (-2.35) (-1.66) SEXHEAD + + - + - (2.78) (0.54) (-0.24) 3.94 (-3.17) FARMLAB + + + + - (0.39) (7.83) (2.90) 0.06 (-0.59) LANDOWN + - + + (4.81) (-0.14) 1.26 (0.13) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 23. Impact of cassava losses on food expenditures Variable Coefficient p-value Per capita monthly hh food dependentC3P –food exp. EXP 0.54 0.005security Caloric consumption 0.001 0.589economics hdd 0.05 0.854 EDUCHEAD 0.05 0.613 AGEHEAD -0.11 0.296 HHSIZE -4.32 0.048 Cmdloss 0.01 0.097 SEXHEAD 0.11 0.543 FARMLAB 0.18 0.924 LANDOWN -0.44 0.042 Ky 55.48 0.007 Tz 39.68 0.04 Bu 25.03 0.030 Rw 44.00 0.000 DRC 126.9 0.000 CONSTANT 18.3 0.614 International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 24. Other • DGDC/CIALCA baseline surveys: 2,600 farmactivities datasets in Central Africa (Rw, Bu, DRC) • Co-authoring papers on: •Ex ante impact assessment of ag-research in Nigeria •Adoption meta study • Some basic cassava agronomics in Kenya and Uganda (as PhD supervisor) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  • 25. Outlook • Final econometrics and publication of C3P results • Publication of a synthesis of cassava impact in Eastern Africa • Publication of business planning study in Tanzania • Publication of Marketing Unit studies in Southern Africa • Backstopping DGDC CIALCA economics • Impact assessment of Market Information Systems in Uganda • Continue food security and impact studies in GLCI: Depict impact pathways International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org