Preliminary Results from AIMS Agro-dealer

Development Impact Assessment

IFDC-BASIS Workshop on The Long-term Impacts of a Temporary Agricultural Input

Subsidy in Mozambique

Maputo, MozambiqueSeptember 15th, 2014

Alexander FernandoIFDC Mozambique

IFDC Baseline – 2007 Poor availability, accessibility

and affordability of agricultural inputs 15 full-time/professional agro-

dealers in Mozambique limited to major towns

Additional 75-150 seasonal ‘traders’ Average farmer had to go 300-

500kms kilometers to get inputs Inputs often >3x the factory price 1 fertilizer blender in Mozambique

(MFC) Poor enabling environment No fertilizer policy, regulations

2

Agro-Dealer Development

Final link with farmers in the input supply chain1. Business & technical knowledge transfer

2. Business linkage with input suppliers and technology transfer to farmers (demonstrations)

3. Strengthening support systems (credit, information, policy, etc.) 522 agro-dealers trained in Beira and Nacala Corridors (USAID and

AGRA funding) Association of input suppliers (AMPIA) established with district-

level AD trade associations established, credit linkage with BOM IFDC now focusing on strengthening local capacity in agro-dealer

development and strengthening the input supply chain with focus on fertilizers

Raw Material Supplier

Basic Manufact

urerFarmer

Agro-Dealer

WholesalerImporter/Blender

3

Agro-Dealer Network Network of 300+ ADs in 5

Provinces, 70% in Beira Corridor

Of 201 trained ADs from AIMS, about 50% still in business

30% of ADs are ‘new’ (untrained)

Average distance to an AD <15kms from 300-500km

Fertilizer prices decreased ~50% and OPV seeds ~30%

Linked to credit through BOM and GAPI

Supplier credit through AFAP4

Agro-Dealer Density

5

FtF/Africa-Rising - low

FtF/Africa-Rising - high

Ghana

Malawi

Kenya

Ethiopia

Tanzania

Zambia

Mozambique

0 10,000 20,000 30,000 40,000

500

1,000

1,190

1,550

1,724

1,887

7,692

15,400

25 - 40,000Agro-dealers per Farmer

Source: Africa Rising (2012), World Bank Agri Business Indicator (2012), IFDC

Preliminary Analysis

Agro-Dealer Profiling & Assessment 12 districts in 4 provinces, 109 AIMS ADs profiled, 65

surveyed, 153 farmers in focus group discussions

6

Trained Non-trained

# employees 2 1

Yrs in Business 9.7 6.2

Initial investment 18,462 14,771

Shops owned 1 1Micro retailers 4 1

Villages covered 5 3

Radius of coverage 27.9 17.3

Seasonal 54% 76%

Preliminary Analysis

Sales (Mzm, 2013-14)

Fertilizers Seeds Ag. Chemicals

Trained = 4.1m

Non-Trained = 0.4m

n=35Source: IFDC Impact Assessment (2014 – in progress)

Trained Agro-dealers.. And constraints Lack of access to credit

(90%) Low profit margin (43%) Seasonal/low demand

(40%) High interest rates

(36%)

7

Services

Before training

(%)

After training

(%)

Technical advice 9 89

Input credit to customers 11 66

Demonstration of farm inputs use 6 57

Farm equipment lease 3 23

Purchase of outputs 20 23

n=35Source: IFDC Impact Assessment (2014 – in progress)

Change after training….

Preliminary Analysis

Farmer Perception of Demonstrations

8

Pest and Disease control method

New seeds or varietal use

Crop spacing

Fertilizer use

Herbicide use

0% 20% 40% 60% 80% 100%

16%

37%

93%

98%

100%

Technologies Perceived as Useful

n=153Source: IFDC Impact Assessment (2014 – in progress)

Preliminary Analysis

Evolutions in Agro-dealer Development Lack of access to credit

and market information Credit guarantee with BOM

and link to AMITSA

Strengthen farmer access to output markets

ADs involved in output marketing

High cost of and focus on training large numbers

Focus resources on wholesale agro-dealers

9

Constraints High cost of fertilizer due to poor

fertilizer supply chain and high cost of credit for ADs

AD business model: need sufficient scale and year-round business, fertilizer sales needs to be balanced with more profitable seed and CPP business

ADs respond to market demand Low sales volumes & low purchasing

power of farmers (vouchers can help) Need to develop the agri-business sector

overall to increase farmer demand Lack of AD accreditation to access

credit and services

To be continued…. 10

Preliminary Analysis

Thank you!

Alexander FernandoIFDC

IIAM, Edificio de Quimica e Biotecnologia, 1st Floor, Room 14

Tel: +258-21-462914 afernando@ifdc.org

www.ifdc.org

11