Today’s indicator figure is 19,675,110
19,675,110 of what?
19,675,110 is an estimate of the number of smallholder farms in East African Community (EAC) countries as determined by the most available statistics from international data providers and reports from the respective country as available.
According to the Food and Agriculture Organization (FAO) of the United Nations, a smallholder farm is one that produces crops with less than approximately 2 hectares equivalent to a land mass the size of 100 meters by 200 meters. Smallholder farms are typically are owned or managed by a single family or extended family. Other definitions of smallholder farms in East Africa include titles as unregistered farms in Tanzania or household farms in Uganda and Rwanda.
Which EAC country has the highest and lowest number of smallholder farmers?
Tanzania has the largest number of smallholder farms with 7,187,032 largely attributed to its large population and land mass respective to other EAC countries. This is followed by Kenya with 4,469,494 farms, Uganda with 3,950,000 farms, Rwanda with 2,165,000 and Burundi, with the smallest number, or 1,903,584 smallholder farms.
How does the number of smallholder farmers in the EAC compare to other regions of the world?
There are approximately 475 million smallholder farms in the world of which China has approximately 166 million, or 35% of the world total, followed by India with 114 million, or 24% of the world total. EAC countries and it is over 19 million farms comprise approximately 4% of the world total. The remainder of Sub-Saharan Africa has approximately 23 million, or 5% of the world’s smallholder farms.
Is the number of smallholder farmers in the EAC increasing or decreasing?
It’s largely unclear. Some reports suggest smallholder farms are decreasing in some countries and increasing in others. From 1960 to 2000 there have been 15 Sub-Saharan African countries reporting a decrease in smallholder farms compared to 3 reporting an increase. Decisions made in the current generations of East Africans will determine if farms are divided among family members or sold off and consolidated along with farms owned by other families, organizations, or corporations.
What impact do smallholder farmers have on the economy of the EAC?
In the EAC smallholder farms contribute roughly 30-40% of GDP, employ roughly 70-80% of citizens, produce approximately 70% of the food that people in EAC countries consume every day. Despite this impact, smallholder farms continue to be among the most underserved markets in the world.
What is being done to better serve the needs of smallholder farmers?
The governments of EAC countries, a multitude of development partners, NGOs, donors, established private sector businesses, and startup businesses are all seeking to improve the needs of smallholder farmers. A few larger programs and initiatives include the following:
The EAC is supporting initiatives around food security, irrigation, early warning systems, research and training, interregional trade which all affect smallholder farmers – https://www.eac.int/agriculture/strategic-interventions
The FAO has developed its East Africa Resilience Strategy for 2018-2022 to contribute to enhanced food security and nutrition – http://www.fao.org/resilience/resources/resources-detail/en/c/1174823/
USAID has developed a program called Feed the Future which seeks to work with countries in the EAC and others to develop agricultural sectors with a particular focus on smallholder farmers – https://www.feedthefuture.gov/
What investment opportunities are growing with this phenomenon?
- Lending and Credit – One of the main challenges facing smallholder farmers is access to credit due largely to poor collateral, varying financial product needs, and lack of credit information. In Kenya, approximately 33% of smallholder farmers have access to credit with loan sizes at approximately $195, or 8% of their annual income. In Tanzania, only 17% of smallholder farmers report having access to credit. There are dozens of microfinance companies and over 40 fintech startup companies operating in Kenya alone, many seeking to address this market gap and many seeking capital for expansion.
- Seeds and Agricultural Inputs – Approximately 17% and 34% of smallholder farmers in Tanzania and Kenya respectively have access to improved seed varieties. Without these seed varieties, the potential yield and income from these farms are limited. Other agricultural inputs such as fertilizer, pesticides, irrigation, and farming insights are also lacking in EAC countries. Several startup companies in East Africa are focused on precision agriculture or using sensors and data analytics to improve farming inputs and outcomes, many of which are seeking expansion capital to grow.
- Supply Chain – getting perishable agricultural products from a smallholder farm far away from main roads all the way to a dinner table presently involves a largely informal network of motorbikes, village markets, a limited set of cold storage enabled trucks, city markets along with traders buying and selling goods throughout. Additionally, getting products to these smallholder farmers from international or local providers requires a similar logistical challenge. Typically supply chain businesses serving smallholder farmers tend to be informal and low margin with significant opportunities for consolidation and efficiency.
How can I learn more?
The Number, Size, and Distribution of Farms, Smallholder Farms, and Family Farms Worldwide – https://www.sciencedirect.com/science/article/pii/S0305750X15002703
The Economic Lives of Smallholder Farmers – http://www.fao.org/family-farming/detail/en/c/385065/
Smallholders Data Portrait – http://www.fao.org/family-farming/data-sources/dataportrait/farm-size/en/
Uganda Census of Agriculture – https://www.ubos.org/publications/statistical/2/
Rwanda Agricultural Household Survey – http://www.statistics.gov.rw/publication/agricultural-household-survey-2017
About the authors:
David L. Ross is the Managing Director at Statera Capital, Distinguished Professor of Practice at Carnegie Mellon University-Africa, and US Ambassador to the Open University of Tanzania. David is active in growing companies in Eastern and Southern Africa through angel investment, investment advisory, strategic partnerships, and executive education. Connect on LinkedIn at http://tz.linkedin.com/in/davidlross1 or at [email protected] .