Focus Area

1. Background

The sugar industry in Tanzania provides direct employment to about 30,000 people. While sugar cane out growers total about 16,768, secondary employments, under the sector involves a total of about 81,360 people. The industry also creates substantial indirect employment in the form of people engaged in the wholesale and retail trade in sugar, providers of transport services and people working in social services in the sugar estates townships.

Provides cane farmers with total earnings of about Tshs 29.4 billion (2009/10) whose benefits spread covers a population of over 160,000 people. Sugar production and employment plays a vital role in rural areas in the development and provision of social amenities including:- schools, hospitals, water supply, townships and farm roads. 

Sugarcane is an important commercial crop in Tanzania. It is the main source of sugar produced for both export and domestic consumption. Currently, most sugarcane is grown in estates, owned by the sugar processing factories (SPF) as well as contract growers (CG). At present there are four large sugar estates in the country. These are former para-statals that have all been privatized in the late 1990’s and now make use of nucleis estate and out growers schemes to get enough supply of raw cane to the processing plant.

Sugarcane is one of the important food and commercial crops of Tanzania. Its production is concentrated mainly in three regions, Morogoro, Kagera and Kilimanjaro. Most of the sugar produced in the country is for home consumption and only a small proportion is exported to service foreign debts.

The total current sugarcane production in Tanzania is far below the country’s annual demand for the commodity. However, research carried out in the country during the past ten years shows that the country has the potential to become a net exporter of the commodity if the current constraints limiting production at the farm level were removed.

Knowledge of the sugarcane growth requirements may improve management of the crop to boost production at farm level. 

Another issue is the high cost of doing (sugar)business in Tanzania and therefore it is still attractive to import (dumping?) of cheap sugar from the world market. 

At present al of the sugar companies run their processing plants at below capacity level. 

Sugarcane requires ample supply of water, 1200 - 1500 mm per annum. In freely drained soils, a high precipitation can be tolerated. The duration of the rainy season is important in sugarcane growth. For example, at the Kilombero Sugarcane Estates where annual rainfall could be as high as 1500 mm per annum, sugarcane is also irrigated because most of the rainfall is restricted to the period between March and May. Adequate moisture and temperature are the two most important ecological requirements that are essential for efficient growth and productivity of the sugarcane crop. If excess water is not immediately drained at the sprouting stage, it will result in rotting of stem cuttings called setts, usually used for the next season’s plantings.

On the other hand, if rainfall is insufficient during theseason, supplementary irrigation becomes necessary to ensure effective development of stems. In this context, water stress occurring in the plant during stem elongation severely reduces cane pro- sugarcane production.


Sugarcane Production Statistics

Year 2002 2003 2004 2005 2006 2007 2008 2009 2010
Produced Tones 1, 750,000 2, 000,000 2, 000,000 2, 346,000 2, 501,000 2, 535,000 2, 595,000 2, 749,000 2, 750,000

Source: Sugar Board of Tanzania (SBT)


2. Potential for Investment in Sugar cane Farming and Processing. 

Tanzania is looking for more investors into sugarcane production so as to meet domestic demand for the commodity as well as generate a surplus for export. This is because the demand is still high. The sugarcane farming and processing in Tanzania is very small and cannot meet the annual demand for sugar.

The country is well situated for the production of sugarcane. It has a wide variety of climatic and weather regimes with an area of 945,087 km2 (Berry, 1991) and a population of over 44 million people most of whom are employed in the rural sector (80%). Apart from the high mountain areas, temperatures are not the major limiting factor to sugarcane production. Rainfall and well drained soils may be considered the limiting factor for most crops, sugarcane inclusive. About 21% of the country can expect 90% probability of receiving slightly higher than 750 mm of rainfall and only about 3% can expect more than 1250 mm. About one-third Sugarcane Production 5 of the country is dry (mainly the central plateau), with less than 500 mm of expected rainfall per year. During most of the year, evapo-transpiration exceeds precipitation in the drier areas. Due to seasonal rainfall shortages, sugarcane farms in Tanzania are situated along river valleys to facilitate supplementary irrigation during the season. To date, only three regions are considered suitable under the above criteria for sugarcane production, i.e., Morogoro (Kilombero & Mtibwa Valleys), Kilimanjaro (under Irrigation Scheme) and Kagera (River Kagera Basin).

There are two major sugarcane estates in Morogoro, Kilombero Sugar Company and Mtibwa Sugar Estates. These together produce over 80,000 tons of processed sugar annually. Kilimanjaro, the Tanganyika Planting Company (TPC) is one of the largest sugarcane estates in the country. Over 35,000 tons of processed sugar is produced annually. The Kagera Sugarcane Estates are fairly small, producing only about 2,000 tons of processed sugar annually.


3. Financing needs for the Sugar Sector.

Entrepreneurs and small holder farmer groups may seek financial assistance for:

  • The planting material and land preparation (including labour costs) for sugar cane farming
  • The purchase farm inputs (fertilizer, agro-chemicals)
  • The purchase of mechanization equipment (tractors, power tillers, forklift and mechanical harvesters)
  • Purchase means of transport (loaders & trucks) -
  • Installation or expansion of irrigation systems and/or equipment.


4.  How can PASS help Farmers  in the further expansion/Intensification of the Sugar Sector.

  • Through feasibility studies and business plans PASS can assist entrepreneurs access to bank loans (financial linkages).
  • PASS can assist in management training for entrepreneurs and smallholder groups in the sugar sector
  • Capacity building and formation of farmers groups and set up of SACCOS.
  • Assist with strengthening links between farmer groups and processing plant
  • Promotion of Nucleis Estate – Smallholder Sugarcane Farming ( a kind of ‘contract farming’)
  • Support farmers with inadequate amount of collateral / security for a commercial bank loan.


1. Background

  • It is estimated that Tanzania had about 34 million chickens by 2011, out of which almost 95% are local chickens and the rest are exotic breeds.
  • Poultry rearing contributes 16% of the livestock GDP, as the biggest part is cattle (70%). Under assumption that the livestock sector contributes 18% of the national GDP and the Agricultural GDP makes 30% of the national GDP, then the poultry sub-sector would contribute around 3 % of the agricultural GDP and around 1 % of the national domestic product.
  • Shinyanga, Mwanza, Tabora, Mbeya, Iringa and Morogoro regions account for 45% of the total chicken population and The number of chickens per household ranges from 9 to 15.
  • Dar es Salaam had the smallest indigenous chicken population (182,448) but the highest number of chickens per household due to large numbers of commercial farms.
  • For the period 1995 to 2003 the average growth rate of indigenous chickens was 2.2 % per year. The rate of growth was relatively higher for the period 1999 to 2003 (4.3%) than during 1995 to 1999 (0.13%). Unfortunately no data is known for the period 2004-2010.
  • 62% of smallholder households in Tanzania keep chickens with 3,017,004 smallholder.
  • Households (2,950,268 on the Mainland and 66,736 in Zanzibar) keeping predominantly indigenous chickens.
  • According to FAO the average consumption of chicken is about 0.7 kg chicken meat and 13 eggs per capita per year in Tanzania in 2010 which is relatively low in comparison to other African countries and the rest of the world which consumes about 6.8 kg and 108 eggs per capita per year). <>
  • The latent demand for local chicken in urban center’s is high as most people in Tanzania prefer the taste of local chicken over the taste of exotic breeds that are perceived as rather tasteless due to their rearing method
  • The Ministry of Agriculture gave a slightly different estimate for 2002/2003 in the order of 34,827,675 chickens. Of this number, approximately 32,559,208 million were local village chickens kept predominantly in the rural areas. Commercial birds included 589,563 broiler and 1,222,267 layer chickens kept by smallholder farmers and 456,638 birds (both broilers and layers) on large-scale farms. There were also 1,362,216 ducks and 213,545 turkeys.
  • Most improved chickens are kept by a relative small number of households. 8% of smallholder households kept 64% of the layers, whilst 65% of the broilers were kept by 7% of the smallholder households.
  • Indigenous chickens are the main type found in the traditional system and comprise over 70% of the national flock, supplying most of the poultry meat and eggs consumed in rural areas and about 20% in urban areas.

Production of one day old chicks (DOCs) on the other hand are carried out in hatcheries most of which are located in Dar es Salaam, Arusha, Mbeya, Morogoro, and Mwanza. The poultry sector grows at an average rate of about 3% per annum. The livestock industry, which includes the poultry subsector, contributes 30% of agricultural GDP (2010). The livestock sector contributes about 4.7% of the GDP (947 billion TZS) - which was equivalent to 789 million USD (2009 data; exchange rate USD 1= TZS 1200).

Years 2002 2003 2004 2005 2006 2007 2008 2009 2010
Live chicken # n.a 33307265 27000000 27000000 30000000 33000000 33000000 33999994 33500
Egg production tons 33800 35100 30100 35100 35100 37060 35030 32950 34250
Meat productions tons 44090 45637 1756 49036 46036 55520 56920 54620 56320
Live chicken import 1176 1542 0.21 1443 2006-2010 no update data could be traced
Chicken meat import 1000tons 0.21 0.81 0.21 0.49 2006-2010 no update data could be traced
Live chicken export 3187 3575 168 91 2006-2010 no update data could be traced
Egg with shells import (1000tons) 0.59 0.03 0.16 0.15 2006-2010 no update data could be traced
Export (1000tons) n.a 0.03 0.01 0.01 2006-2010 no update data could be traced

Source: Ministry of Livestock Development and Fisheries <>FAOSTAT.

Chicken meat is about 555,000 tons (according to FAO 2011 Data). Consumption of poultry and poultry products are also lower in Tanzania compared to many other African countries. The traditional poultry sector is the largest and accounts for 70%, while the modern poultry sub-sector accounts for 20% of the total poultry sub-sector. Almost 100% of poultry meat and eggs consumed in rural areas are from the traditional sector. Most commercially produced poultry meat and eggs are sold to the urban population in the cities.

Challenges facing Production and Productivity in Poultry Meat Sub-Sector (Broilers):

  • Availability and price of poultry feeds and veterinary services
  • Access to good quality water sources and a disease free environment
  • Consistent supply of quality feed resources
  • Increase in demand for quality for broiler and traditional poultry meat
  • Increase demand for hatcheries and production of quality one day old chicks
  • Increasing poultry production infrastructures
  • Control of (contagious) poultry pest and diseases (layers and broilers)
  • Improving poultry slaughter and marketing facilities and efficiency
  • Improving accessibility to credit facilities
  • Provision of technical support devices and extension services
  • Strengthening poultry farmer organizations
  • Increasing domestic demands through poultry meat consumption promotion

Poultry Egg Production (Layers sub-sector)

The number of eggs produced by smallholders in Tanzania during from 2007 to 2010 was 367,955,297; of this 351,941,008 eggs were produced on the mainland and 16,014,289 in Zanzibar. Most of the eggs produced in Tanzania were from Mbeya (16%), Arusha (9%), Mwanza (9%), Tabora (7%), Iringa (6%) and Dar es Salaam (6%). This represents 52 percent of the total egg production in Tanzania from smallholders (National Sample Census of Agriculture 2007-2010). Eggs produced in the period 2007-10 was 910,000,000 (Prime Minister speech in Parliament). The difference (542,044,703) could be accounted for as result of production from large-scale commercial poultry farms in Tanzania over the same 4 years. 68% of eggs from indigenous chickens are sold. Today the average price of egg is Tshs 300 (US $ 0.18). The percentage sold can reach more than 80 percent as in Dar es Salaam (97%), Lindi (84%), Kigoma (83%), Dodoma (82%) and Arusha (81 %). This percentage can be as low as 38 percent in Mwanza, the highest egg producing region in the country. Eggs not sold would be used for consumption by the family and some will be incubated for hatching. Source: FAO Animal Husbandry and Animal Health 

Division - Poultry Sector Country Review for Tanzania, 2007-08

Challenges facing Production and Productivity in the Egg production Sub-Sector (Layers)

  • Availability and price of poultry feeds and veterinary services.
  • Access to good quality water sources and a disease free environment.
  • Consistent supply of quality feed resources.
  • Increase in demand for quality eggs.
  • Increase demand for hatcheries and production of quality one day old chicks.
  • Increasing poultry production infrastructures.
  • Control of (contagious) poultry pest and diseases (layers and broilers).
  • Improving poultry slaughter and marketing facilities and efficiency.
  • Improving accessibility to credit facilities.
  • Provision of technical support devices and extension services.
  • Strengthening poultry farmer organizations.
  • Increasing domestic demands through eggs consumption promotion.

 2. Potential for Investment in Poultry Industry. 

Tanzania could easily accommodate 100 to 200 million poultry birds, as there is space for poultry and feed production enough in the country. There is ample potential for expansion of the poultry industry through better chicken rearing & other husbandry practices and improve the chicken breed by having established quality hatcheries. 

The imported chicken meat from Brazil for tourist hotels and mines cost Tanzania dearly every year. Unfortunately no updated statistics are available on the TZ import of chicken meat. This demand could potentially be met by high quality local production. This situation could also be used as a window of opportunity to improve the standard of hatcheries, poultry production places and in an increase in volume and number of poultry slaughterhouses. The increasing demand of poultry meat and eggs in the eastern and southern African countries are also be tapped as a potential market once better poultry practices are adopted and improved hatcheries and chicken meat processing facilities are established and operational.

Venture possibilities

  • The commercial poultry sector is underdeveloped and only a few companies such as NAPOCO (Usa River), Mkuza Chicken (Kibaha), Ruvu JKT (Bagamoyo) and Euro Poultry
  • (Mkuranga), Kenchick, Interchick and Twiga feeds (all in Dar) have established large-scale poultry production units mostly for the urban market.
  • Establishment of (chicken) meat processing facilities for the domestic and export markets, including such poultry products as whole chicken en chicken cuts (wings, quarters, liver etc).
  • Establishment of chicken feed mills.
  • Establishment of cold storage and transport facilities for poultry products, only in conjunction with large scale production and slaughterhouse facilities.
  • Provision of veterinary services in the areas of disease monitoring, control and prevention.
  • Facilitation of existing training institutions and extension services for the poultry industry. 


Potential markets

  • The domestic market for chicken meat and eggs is growing, especially in urban areas where there is a high dependence on imports.
  • The European Union is a potential market for Tanzania’s livestock and products once farmers are able to adhere to the strict conditions and requirements of the European market.
  • The Eastern and Southern African countries are a potential market once better animal husbandry is adopted and processing facilities established.


Table 2: Returns to Investment in the Livestock Industry 2012 – PASS data.

Item Low Tech Interme diate High Tech
Poultry - layer cost per 5000 layers     60756388
Revnues from sales og eggs     91800393
Gross margin     31044005


Table 3: High Potential Areas for Investments in the Livestock Industry

Best locations for Investments Size of Potential Existing Infrastructure
All regions in the country Millions of hectares suitable for Poultry farming Most regions are accessible either by paved roads, by railway networks or by boat services.


Investment Potential for Increase in Output/Production and Productivity of Poultry (Broilers)

  • Improvement of quality and quantity of chicken feeds
  • Hygiene and proper care of poultry stock (broilers)
  • Veterinary care and control of poultry pest & diseases
  • Access to clean drinking water & veterinary services
  • Proper housing of animals and access to clean drinking water
  • Establish and strengthen poultry farmers association
  • Improving access to credit facilities
  • Technical training in broilers production (esp. on feeds and prevention of transmission and control of diseases)
  • Increase and improve (chicken) meat processing capacity (slaughterhouse)
  • Improve efficiency of poultry marketing system including cold storage.


Investment Potential for Increase in Output/Production and Productivity in Poultry (Layers)

  • Improvement of quality and quantity of chicken feeds.
  • Breeding of high quality stock (layers).
  • Hygiene and proper care of poultry stock.
  • Improvement of quality and quantity of animal feeds.
  • Veterinary care and control of poultry pest & diseases.
  • Proper housing of animals and access to clean drinking water.
  • Establish and strengthen poultry farmers organizations.
  • Improving access to credit facilities.
  • Technical training in layers production (esp. on feeds and prevention of transmission and control of diseases).
  • Increase and improve storage and marketing capacity for eggs (quantity & quality).
  • Increasing domestic demands through milk consumption promotion.
  • Improve efficiency of egg marketing system incl. cold storage.


3. Financing needs for the Poultry Sector (Layers & Boilers).

Financial support in this industry is of great importance due to its capital intensity. PASS has identified the following financial needs for the poultry sub-sector / poultry producers:

  • Establishing of adequate poultry houses, water supply, electricity and drainage.
  • Establishment of hatcheries for the production of one day old chicks (DOC).
  • Funds for purchase of initial stocks, feeds and operational cost (labour).
  • Invest in adequate veterinary medicines and adequate feeds for the birds.
  • Establishment of poultry processing facilities & cold storage.
  • Establishment or upgrading of slaughterhouses, including proper waste disposal technology.
  • Establishment of poultry feed mills for specialized feeds for broilers and layers.
  • Provision of veterinary services in the areas of diseases monitoring, control and prevention.
  • Establishment of cold storage and transportation facilities for slaughtered chicken products.
  • Establishment of training institutions for the poultry and poultry feeding industry.
  • Invest in proper packaging and marketing of poultry products including eggs.
  • Purchase transport and loading equipment & facilities.
  • Invest in storage facilities, packaging and marketing equipment.


4. How can PASS help Farmers in the Poultry Industry? (layers & broilers)

  • Through feasibility studies and business plans PASS can assist poultry SME entrepreneur’s access to bank loans (financial linkages).
  • Assist in capacity building of farmers groups and entrepreneur management skills
  • Assist poultry SME entrepreneurs with layout for poultry houses, storage and marketing facilities and mini slaughterhouses,
  • Assist poultry producers with market linkages and assist with developing marketing strategies for wholesaling and retailing of poultry products.
  • Organization of farmers into groups, which can be used as focal points for contract farming, input supply credit,produce -price negotiation and provision of advisory service.
  • Support poultry farmers and poultry SME agribusinesses with inadequate amount of collateral / security for a commercial bank loan.
  • Assistance of eligible individuals and companies to access loan facilities for their viable investment through appraisal of loan write ups in line with specific bank’s terms and condition and linkages.



1. Background

Tanzania’s agriculture is heavily dependent on rainfall but under good weather conditions the country is able to achieve selfsufficiency in food as measured by level of domestic supply of grains. This fact sheet focus on the so-called small grains: sorghum and millet. These grains appear to have a good drought resistance and therefore are ideal in the food security strategy of rural households and for the country.

With improved crop husbandry, there is the potential to produce 714,080 tons of sorghum and 182,052 tons of millet annually. There are over 9 millions hectares of arable land that are highly suited to grain production. Only between 3.0 and 3.5 million hectares are actually used for grain production. Of these area under grains, only estimated around 250,000 ha is under millet and around 650,000 ha under sorghum.

Most grain production still very much rely on the hand hoe and/or ox plough instead of tractor tillage that has the capacity for speedy expansion of cultivated area.

Total grains account for about around 50% of all food produced in the country taking account of production of other food crops like cassava, bananas, sweet and round potatoes as well as legumes, pulses and oilseeds. Probably 10-20% of total grains consumed consist of sorghum and/or millet.

Grains are also the most locally traded of all crops and therefore form a valuable source of income to farm families and to millions of grains merchant al over the country.


Sorghum is the third most important cereal in Tanzania. It is the main cereal grown in the drier parts of the country notably in the regions of per year About 788,000 metric tons of millet is produced annually in an estimated area of 650,000 hectares per annum Areas which are used to cultivate sorghum include: Dodoma, Morogoro, Mwanza, Tanga, Shinyanga, and Tabora account for a high percentage of all sorghum produced in Tanzania. The population in these regions consume substantial amounts of sorghum in their diets. They form a primary market for sorghum.

There is a potentially large export market in the Northern and Western African countries that consume sorghum as a primary staple. Local and international markets can be reached from all key producing regions by using the Central Railway Line connecting to the Dar-es-Salaam port of export.


Millets are the fourth most important cereals. They are produced in smaller quantities but they are widely consumed and traded nationwide. Finger millet is by far the most traded of all millets followed by bulrush millet. Millets are produced mainly in the regions of Dodoma, Singida, Kilimanjaro, Shinyanga and Rukwa. About 225,000 metric tons of millet is produced annually in an estimated area of 250,000 hectares.

The population groups in these regions are large and form a significant part of the local market. Other local markets can be reached either by the central railway line or by road networks. Finger millet is highly demanded in urban areas of Tanzania and Kenya. These markets can be accessed either by railway network or by road from the producing regions. 

Sorghum and Millet Production Statistics

Production of sorghum and millet has gone up in the recent years. Production of millet has more than doubled, while production of sorghum has almost quadrupled (4x) in the last 7-8 years. Productivity of sorghum and millet production has gone up in the recent years. Yield of sorghum has more than doubled, while yield of sorghum has increase by around 50% in the last 7-8 years

 Crops Production per Tonnes per year 2003- 2010

Type of Crops 2003 2004 2005 2006 2007 2008 2009 2010
Sorghum 198870 757420 714339 711631 971198 861386 709000 788800
Millets 91280 246250 218760 227905 219000 220000 205321 225000

 Source: FAO Statistics


Yield (Kg/Ha) from 2003-2010

Type of Crops 2003 2004 2005 2006 2007 2008 2009 2010
Sorghum 4423 10863 9691 9941 11874 9593 8110 9738
Millets 4522 7078 7725 8600 8104 7338 6373 6818

Source: FAO Statistics


Gross Production Value (constant 2004 -2006 1000 I$) (1000 Int. $)

Type of Crops 2003 2004 2005 2006 2007 2008 2009 2010
Sorghum 198870 757420 714339 711631 971198 861386 709000 788800
Millets 91280 246250 218760 227905 219000 220000 205321 225000

 Source: FAO Statistics


Net Production Value (constant 2004-2006 1000 I$) (1000 Int. $)

Type of Crops 2003 2004 2005 2006 2007 2008 2009 2010
Sorghum 4423 10863 9691 9941 11874 9593 8110 9738
Millets 4522 7078 7725 8600 8104 7338 6373 6818

 Source: FAO Statistics


2. Potential for Investment in Sorghum and Millet. 


  • Expanding the existing area under sorghum production by making use of advanced types of farm mechanization, ox plough and other labour saving technology.
  • Intensification of sorghum production. Yield increase can be achieved by improved agronomic practices making use of adequate amount and type of farms inputs such as improved seeds, fertilizers, agro-chemicals and extension services.
  • Developing the export potential in countries in North and West Africa, where there is a food shortage of sorghum due to drought (‘desertification’).
  • Introduction, operation and maintenance of tractors and other forms of farm mechanization in sorghum production. Loan repayment is an essential part of the introduction of tractors and other farm mechanization equipment..
  • Agro-processing of sorghum. Milling of sorghum grain into flour for (baby) food ; local beer brewing for drink


  • Expanding the existing area under millet production by introduction of tractors and other forms of labor savings technology such as ox plough and farm mechanization.
  • Intensification of millet production. By improving agronomic practices such as making use of adequate amount and type of farms inputs such as improved seeds, fertilizers, agro-chemicals and extension services, yields of millet can grow higher.
  • An export potential for millet could be developed in North and West Africa, due drought conditions in that area of Africa, caused by desertification.
  • Introduction or further expansion of farm mechanization tools and equipment in millet production. When tractors are being introduced also attention should be given to operation and maintenance of equipment and loan payment.
  • Grain milling of millet into flour for food consumption.

3. Develop Production and Marketing Infrastructure.

Market Possibilities

  • Due to population growth, the demand for sorghum and millet is growing in the domestic market. Due to limited supply, most sorghum and millet is consumed in the production area. However, there is a growing demand for these grains in the domestic market, as well as in the export market.
  • Aside from North and West African countries, there is also a potential (large) market for sorghum and millet in the Southern African sub region and in Africa as whole.
  • There is potential a (large) market in Europe for organic grains to be used in animal feed mills.

4. Financial needs for Investment in Sorghum and Millet 

Entrepreneurs / farmer groups may seek financial assistance for:

  • Funds for land preparation, especially when tractors or labourers are hired
  • The purchase farm inputs (seeds, fertilizer, agro-chemicals, sprayers).
  • The purchase of tractors and other forms of mechanisation.
  • Purchase transport and equipment.
  • Purchase of brewing equipment for hygienic production of local beer.
  • Purchase of improved processing equipment for sorghum an millet.
  • Storage facilities, post-harvest equipment and packaging material for millet flour.
  • Market Surveys in the sub-sector sorghum and millet.


5. How canPASS help Farmers in the Investment / Intensification of Sorghum and Millet Production and Processing.

  • Through feasibility studies and business plans PASS can assist entrepreneurs access to bank loans (financial linkages).
  • Capacity building of farmers groups and entrepreneur management skills.
  • Training on yield increase and post harvest technology for sorghum and millet.
  • Training in agro-processing: on hygienic beer brewing of sorghum and more efficient grinding of millet into flour.
  • Assist with market research and market linkage for sorghum and millet.
  • Support farmers with inadequate amount of collateral / security for a commercial bank loan.


1. Background

Tanzania has an area of 945.239 (94 million ha), 44 million ha are classified as suitable for agriculture and about 10.1 million ha or 23% is under cultivation. Agriculture is the leading sector of the economy. It accounts for about 26% of GDP. Over 80% of its 40 million people are living in the rural areas with agriculture as the mainstay of the living and smallholder farmers cultivate between 0.2 and 2.0 ha the level of mechanization is low with the hand hoe dominating in farming systems. The use of animal traction is estimate at 24% and the mechanical power is estimate at 13%.. Examples of agricultural mechanization equipment are tractors, power tillers, weeders, maize shellers, sugar cane forklift and mechanical harvesters. Some tractor models have experienced (frequent) breakdowns and some more feedback is expected from services agents & suppliers.

The Role of Agricultural Mechanisation

  • Mechanization is a necessary condition for farmers to improve productivity of labour and land.
  • Mechanization of agriculture has the potential to turn idle land into productive land for national economic growth and increase of land.


2. Present situation of Agriculture Mechanisation.

Most farm land is still ploughed with hand hoe and ox plough. The number of tractors is on the increase (see table below). Most farm mechanisation is limited to tractor and plough. There are few machine harvesters and very few mechanised dryers and maize shellers; Many tractor operators/owners have also trailers to transport farm produce from the farm to the house or to the market.

In the tea sector, there are now mechanised tea picking machines (Mufindi); In the sugar, there are now forklift trucks and sugar cane cutters (Kilombero). Also water pumps are widely used in the county. Some are connected to tractor engines, others are driven by electric power supply or (mobile) diesel engines.

Trends and Statistics on Farm Mechanisation There has been a 300% increase in number of tractor in use. (see table below). Therefore the amount of arable land per tractor has reduced from 1196 ha (1995) to 442 ha per tractor (2007) . Also there has been an increase in number of tractors per 100 from 8 (1995) to 24 (2007). The following indicators show the degree of agricultural mechanization in Tanzania:

3. Potential for Investment in Agricultural Mechanization.

Large areas of farm land are still available for mechanisation. Most suitable land for mechanised ploughing has (medium-) deep soils without roots or where roots of trees have been removed. Flat perimeters in irrigation areas are also very suitable for mechanised, ploughing, planting, weeding and harvesting. Hilly areas can also be ploughed by tractors, but requires ridging along the contour lines (horizontal ploughing). This to avoid the run-off of rain water and soil erosion from the hill downwards in freshly ploughed vertical ridges.

  • Mechanisation is more than tractorization. With additional / auxiliary equipment the tractor can be used for planting, weeding; shelling; harvesting and water pumping. It could even be used to distribute fertilizers and spray agro-chemicals). This will assist the efficient use of equipment and facilitate loan repayment.
  • The government will support farm mechanisation through policies on mechanization of crop production and increased productivity.
  • The private sector is allowed and encouraged to acquire machinery and provide hire services to farmers for primary and secondary agricultural operation importation trends show a steady increase in number of imported mechanical power machines
  • Demand for two axle tractors and implements are 1500 –1800 p.a. and increasing
  • Demand for single axle tractors is 1500 – 2000 p.a. and increasing.

4. Challenges in Agricultural Mechanisation

  • Low purchasing power and management skills in operation and maintenance of most small scale farmers.
  • Mechanisation can attack low productivity / low farm income as farmers in the past used mainly hoe / ox plough for land cultivation.
  • Low producer prices due to lack of bargaining power and market information.
  • High cost of agricultural machinery despite the low or no import charges on agricultural machinery.
  • Limited access to agricultural credit.
  • Lack of well trained operators and mechanics for farm machinery.
  • Lack of suitable machinery packages for main agricultural operations.
  • Importation of tools, equipment and machinery of poor quality is costly.
  • General poor technical know how among tractor owners/operators.
  • Use of secondary tillage implements is limited (only plough is commonly used).
  • Limited availability of spare parts and trained technicians for operation and maintenance.
Years 1995 1997 1999 2001 2003 2005 2007
Number of Tractors in use 7525 10435 14345 18255 21300 21500 21500
Number ha arable land in million 7525 8.95 8.85 8.9 9.47 9.5 9
Number of ha arable land per tractor 1196 858 617 488 445 442 442
No. of tractors /100 sq. km arable land 8 12 16 21 22 23 24

Source: World Bank Indicators - Tanzania - Agricultural Production, 2012 - 04 -19


Operation & Maintenance of Agricultural Equipment Tools

  • The tractor and its implements play a significant role in mechanised agriculture. Tokeep them working for a long time at a minimum cost, they require an adequate and timely maintenance. The following are equally necessary.
  • Suppliers and Availability of Spare Parts.
  • Training of Tractor Owners/Operators.
  • Possibilities of Service Contracts (attractive for bank lending).


5. Potential for Improving Agricultural Mechanisation

  • Large areas still available for mechanisation ( flat, deep and fertile soil; )
  • Government will/support through policies on mechanization of crop production and increased productivity.
  • Farmers’ will to use farm machinery
  • The private sector is allowed and encouraged to acquire machinery and provide hire services to farmers for primary and secondary agricultural operation.
  • Importation trends show a steady increase in number of imported mechanical power machines.
  • Demand for two axle tractors and implements are 1500 –1800 p.a. and increasing
  • Demand for single axle tractors is 1500 – 2000 p.a. and increasing

There is a potential for establishing tractor mechanisation pools for groups of farmers organised in a cooperative or farmers associations or a private tractor company, which is eager to rent out farm mechanisation equipment (e.g. a tractor hire service company, like TFA/TFSC in Arusha).

High Potential Areas for Introduction & Expansion of Agric. Mechanisation

  • SAGGOT, this include Coast, Morogoro; Iringa, Mbeya, Ruvuma, Rukwa.
  • Central Zone, this include Dodoma; Shingida;
  • Lake Zone, this include Shinyanga, Mwanza; Mara; (only 4 districts in Kagera: Biharamulo/Chato and Karagwe; Missenyi) Manyara Regions: Kiteto; Babati and Hanang esp. Bassuto District
  • Arusha & Kilimajaro Regions: all districts, esp. Lower Moshi Irrigation schemes and similar irrigation schemes in Same etc.
  • Coastal Zone, this include Tanga (excl Lushoto), Bagamoyo, Kibaha, Rufiji Basin, Lindi, Mtwara.


6. Financial needs for Agricultural mechanisation. 

  • Due to the high cost of farm mechanisation, most agri-business entrepreneurs, commercial farmers or farmers associations (FA),cooperative savings organizations (SACCOS) and the like need external financing (loans) to be able to procure new farm equipments and tools.
  • In some cases subsidy schemes for farm mechanisation are available from the government through Armed Forces Development Organisation (JKT); Agricultural Window of the Tanzania Investment Bank (TIB); Agriculture Input Trust Fund (AGITF); some donor funded tractor and/or SME schemes.
  • Most tractor & farm mechanisation schemes need the technical support from dealers or technical equipped workshops, because the operation, maintenance and repairs of many tractors and other mechanisation equipment is poor. Frequent break downs also cause poor loan repayment.

Individual agri-business entrepreneurs / farmer groups associations may seek financial assistance for agricultural mechanisation for:

  • Expand the area suitable for mechanised crop production (especially in irrigation areas with 2 harvest per year).
  • Also for bush clearing - to make land available for ranchingrequires the use of mechanised bush clearing equipment (bulldozers).
  • Improve soil tillage for crop intensification as higher yields can be achieved by making better use of improved seeds, fertilizer, agro-chemicals, etc.
  • To overcome labour shortcoming in the farm in critical farming periods (by mechanised ploughing, weedin, harvesting).
  • To reduce cost of labour by substituting labourers with power tillers and tractors, or go for complete mechanised crop production including harvesting, threshing, bagging and bailing.
  • Post-harvest equipment, grading, sorting and packaging equipment and materials. Source of Funds:
  • Own Funds from Savings.
  • Bank Loan from Commercial -, Community - and Cooperative Banks.
  • Micro-Finance Institutions (MFI) and Rural Financial Institutions (RFI).
  • Government: Agricultural Input Trust Fund (AGITF); SME Schemes
  • Cooperatives such SACCOSs and AMCOSs;
  • Assistance to access loans from sources above with Possibility of Loan Guarantees: GOT; PASS.


7. How PASS can help development of Agric. Mechanisation on farms.

PASS TRUST does not lend out money, but can assist farmers/clients to get bank loans (financial linkage) for purchasing farm machineries and agro-processing equipment through;

  • Making feasibility studies and preparation of business plans for proposed crop & livestock mechanization and agro processing and submit it to bank for loan.
  • Capacity building of farmers groups and entrepreneur management skills in farm mechanization and agro-processing, especially in irrigation areas.
  • Training on operation, maintenance and service of farm machineries and post harvest technology and agro processing (for example: for rice and other crops grown in irrigated or upland farming areas).
  • Training in agro-processing: operation, maintenance and service of agriculture processing equipment, rice & maize milling, coffee hulling; oil extraction from sunflower and other edible oil products; and processing of other commodities.
  • Assist in market research and market linkages.
  • Counselling and assisting in financial management of agribusinesses in mechanized crop and livestock production and agro-processing.
  • Backing up loan applications by topping up collateral to level required by banks.
  • PASS can provide a lease product for hire-purchase of farm machineries. This is a new PASS financial products also called asset based financing.
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