“If these smallholder farmers are not aggregated to have economies of scale the big players will come in and phase them out of the business.”
Kenny Ashaka
Mallam Suleiman Mohammed Dikwa, the Chief Executive Officer of Green Sahara Farms Limited, an organisation that consists of a number of companies engaged in a variety of agricultural businesses has explained why the Federal Government’s Agriculture Promotion Policy tagged “The Green Alternative” 2016-2020, has failed to scale up agricultural production as expected.
Dikwa noted that despite the brilliant policies enunciated in the document, it has been rendered unworkable because of the wide gulf between policy intension and actualisation. He, however, said farmers are now able to get markets for their products due to the policy of the import substitution build up.
The Green Sahara Farms boss placed firmly in position why Nigeria cannot compete with Thailand in rice production, saying the big players in the Nigerian rice sector have almost suffocated the smallholder farmers while, “Thailand still has smallholder farmers which is the best policy we need to adopt to enable majority of our people to get out of economic distress situation.”
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In this interview, Mallam Dikwa equally gave reasons why Nigeria still imports rice and other foodstuffs despite the Green Alternative policy.
Excerpts:
The 2016-2020 ‘Green Alternative’ document, its implication
The policy as put together has two dimensions, like I would want to use the last word you mentioned which is scale. Has it scaled up agriculture? Like many policies in Nigeria whether in agriculture, sports and whatever, we have brilliant policies and I must say no policy is imperfect in itself because we have brilliant policies, but yes we can scale up agriculture to address issues of unemployment in agriculture. I will give you an example.
One of the biggest players is investing about $5 billion or more in agriculture in terms of scale. But how many jobs are they creating? About 90,000; so the main thing government needs to look at in the first place is the appropriate policy.
Are we looking at the right examples? Are we looking at countries with similar circumstances with us? How do we get smallholder farmers into the economic system whereby they have sustainable goal and we can scale up? There is the issue of food security which the document seeks to address and may be that is where the issue of scaling up comes in. But you will agree with me that even if we scale up and majority cannot afford it, that also brings a problem into the system. That said, the other aspect of it is that…which is the most positive thing the government has done is the policy and the body language. The political will is there but what about the bureaucracy it entails? We have five or six agencies that are intervention agencies and we have more than $5 billion available for farmers. Are they being accessed? It’s been very difficult to access. So the gulf between policy intension and policy actualisation is wide.
People like us in the sector have been able to have moderate success not because of the outcomes of the policy, or the physical intervention of the policy but because of the awareness, the political will that the time has come that we have to feed ourselves and certain policies that restricted the availability of access to finance to import as well and the destabilisation of the system which has made companies now to start looking inwards to source their raw materials. Yes in terms of scale the policy is right and we can achieve that but it creates its own problem as well.
The problem is that when we tell these big farmers to come in, where are the jobs? Where are my people and your people in the village going to be engaged when you have people investing like hundreds of millions of dollars? What is the solution? It is to enable those smallholder farmers to have economies of scale which is one of the things we have been trying to do in this country.
Protecting smallholder farmers
If these smallholder farmers are not aggregated to have economies of scale the big players will come in and phase them out of the business. I will give you an example in retail sector.
I keep telling those in the retail sector that you can walk into Shoprite and get guaranteed quality and something cheaper. They have ambition to have more of the shops. So if you are a retailer you have to start thinking that if you can walk into a better environment and get these things cheaper that means my days are numbered. So it is the same thing with the farmers. Yes the policy is talking about scale but at the same time the policy will look at its implications. If you look at countries like Thailand and India that have aggregated and have measurable success. They have small farmers. But here, we are looking at America that has commercial farmers, they don’t have smallholder farmers; but India, Thailand have smallholder farmers which are the best places we need to adopt the model that will enable majority of our people to get out of the situation.
Access to credit, quality seeds, mechanisation, as missing link
Yes, in terms of the renewed interest by the private sector and companies that are now willing to engage the smallholder farmer…that is why I said policy intent is there but there is a gulf because it is difficult for farmers to access the interventions. But due to the policy of the import substitution building up we are able to get to markets. That is the most significant change that has happened.
The policy is capable of raising market access to farmers, but for now the success is limited. In terms of market, yes. And that has to do with the company itself. When we started, for instance, we approached many companies. But it was Tiger Foods that said we should take up the challenge by involving Nigerian farmers. That is why I said in terms of market, yes there is limited success. But it is still very difficult to access credit, quality seeds, mechanisation and then the application and solutions are missing. So, yes the policy is good but it has had limited success because of the impracticability in some aspects of it.
Why FG’s policy direction is distraction to farmers
Our focus is to create an economic cluster which is sustainable because sustainability is key where any stakeholder be it government, end users of raw materials, be it farmers and input suppliers to work within the system that every stakeholder plays its own role to ensure that acceptable standards and yields are being produced to meet the yearnings of the market. The market will never deny quality and quantity. So that is our focus; to be able to able to produce world class products from the bottom of the pyramid by addressing unemployment, quality issues and so on. The body language of the government has helped us and the policy direction has shifted focus on farming. Then the compelling economic situation too…because there are no prospects for employment that has shown the profile of the farmer to move. Before you only have peasant farmer but now you have young people that have studied abroad going into farming, you have women and other class of Nigerians who are willing to be involved in farming. So it is for us to create economic cluster of all the players in the agricultural sector within a system.
The most important and critical things in agriculture are the soil, market. In soil, you have water and inputs it must feed. So what we have been able to do is to procure the best solutions in the world that will do natural fixing for our soil so that they get increased yields. We have secured premium markets for our farmers. We have been able to bring some of the best inputs, both intellectual and material into our economic cluster that is assisting farmers to improve yields, have more returns on their investment and to eliminate post harvest losses.
Why Nigeria still imports food despite Agricultural Promotion Policy
Scaling and sincerity of purpose is the bane. We have had organisations all over the years. Our experience in the field brought up the idea of Union Farmers. The only thing they do is that they are an organisation. We have internet farmers and political farmers, but the real farmers are out there. And why we have not been able to achieve much…I will give you rice as an example.
The reason we cannot compete with Thailand, stems from soil preparation, management and harvest. If you do not prepare the soil well…we have the poorest return per hectare in the world, not only in rice, but in maize and everything. The yield per hectare is very low and it starts from the soil. So if you fix the soil you have solved significant aspect of the problem.
If you fix the width management you have reduced the cost to the farmer. Then that concept in farming only during the rainy season does not work anywhere. A farmer has to be able to farm all year round. So those countries are still producing cheaper than us. Somehow those goods find their ways into our market. Then thirdly, Nigeria has to find a way to subsidise the farmer. Subsidy does not necessarily mean fertilizer but there are many innovative ways you can help the farmer. You can do that by reducing his or her cost of production so that his goods are competitive. So these are some of the agricultural best practices. What we are practicing cannot make us compete with other countries.
Also infrastructure and post harvest management are there. You go to our markets you discover that because post harvest handling is not properly done they lose almost 40 percent of their harvest. Market is there. So if you are able to create an economic cluster which is self adjusting, self developing and self evolving, there are no price and loss shocks you cannot absorb because there will be insurance players. And there is no subsidy that cannot be effectively managed because it is an economic cluster and government is there.
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