CONTRACT farming, an alleged ideal solution of reforming the country’s cotton sub-sector, is on the verge of collapse due to what industry sources describe as vested interest of few dishonest players.
Some cotton buyers and ginners, averse of investing in cotton production as stipulated under contract farming, have reportedly frustrated the system, which was picking up under the personal initiatives of the Cotton Buyers and Ginners Association, UMWAPA.
It was the Tanzania Cotton Board (TCB), the cotton industry regulatory body that introduced contract farming on a pilot basis in MaraΆs Serengeti, Bunda and Musoma Rural Districts in 2007.
The piloted system succeeded in increasing cotton productivity, thanks to extensive uses of inputs and extension services provided under the system, convincing the government to replicate the system countrywide in the 2011/2012 farming season. The system, unfortunately, flopped soon as some opponents used their financial and political powers to frustrate it.
TCB Acting Director General Gabriel Mwaro concedes that non-involvement of the ginners could have partially contributed to the system failure: “Initially, ginners didnΆt own the idea of the contract farming.”
But some cotton buyers and ginners, too, seem to abhor contract farming, which compels them to invest in the production of the cash crop before reaping any benefit from the produce....they have to invest heavily in the supply of farm inputs and extension services on credit to producers and later buy the produce.
Producers, on the other hand, enjoy the system that avails them with an opportunity for agency business, through their business groups, getting rid of hundreds of exploitative agents in the crop marketing chain.
So, the farmersΆ business groups not only guarantee credits to individual farmers but also generate more revenues through the agency commission. Ideally, contract farming is the answer to the chronic problems in cotton production and marketing. But, the system is equally a serious threat to the survival of greedy people, some of them powerful politicians, who used to unfairly enrich themselves by exploiting the poor peasants.
No wonder, contract farming is facing strong resistance from financial and political power wielding businesspeople. Even after UMWAPA members, who treasured the system and reintroduced it in Mwanza, Shinyanga and Geita Regions for their own survival seem to have bowed to resistance.
Reports from the Western Cotton Growing area have it that production will this year drop considerably due to a number of reasons but mostly due to the collapse of the contract farming arrangement.
“There is no hope of our members participating in contract farming this year although we have already distributed seeds on credit to farmers,” a senior officer with UMWAPA told the ‘Daily NewsΆ over the phone from Mwanza over the weekend.
UMWAPA and other stakeholders have raised concern over interference by non-members, against the Memorandum of Understanding (MoUs) that the association signed with all district councils where contract farming is practiced. Under the MoUs, the councils are expected to protect the investors against side-selling by deceitful farmers and unauthorised cotton buyers.
But, the government leaders on whom UMWAPA relies for the successful implementation of the system seem to have misconstrued President John MagufuliΆs directive to embrace local and foreign investors, to instead cuddle people who are actually frustrating the cotton growersΆ preferred system.
“Yes, President Magufuli has ordered government employees to handle investors kindly...and truly that is good but he is not definitely in favour of wicked individuals bent on frustrating the development of the poor peasants,” charged the source.
The indiscriminate buying of cotton cripples the contract farming arrangement as it encourages side-selling and credit defaults. Available statistics have proved that although overall cotton production dwindled last year by 30 per cent due to unfavourable weather, cotton production in areas with contract farming increased by six per cent.
Contract farming, as far as the plight of the cotton sub-sector is concerned, is the best available approach to pursue and stakeholders can opt to snub the system at their own peril.
ItΆs up to all stakeholders--farmers, local government authorities, industry regulator and buyers themselves-- to embrace the system wholeheartedly and reap its benefits or rebuff it and prepare for the consequences, including the total collapse of the cotton sector in the country.
