An Action Plan for Developing Agricultural Input Markets in Tanzania

• Importers provide credit, delivery, technical assistance,
and repackaging services.
• Importers do not monitor their products once they
have been sold to guard against adulteration.
Independent Dealers
There are no accurate data available on the number
and spatial distribution of independent dealers in
Tanzania, but it is estimated that there are 500 independent
dealers countrywide. These dealers sell their
products to approximately 2,000 stockists and they also
retail directly to farmers. There are typically one to
two independent dealers (and 810 retailer/stockists) in
each regional capital and large rural town. The distribution
network for CPPs has not penetrated beyond
this point to the rural interior close to villages. Independent
dealers share the following characteristics:
• Many of the independent dealers are agents for one
or more of the importers.
• Their product line is comprised mainly of CPPs,
veterinary products, animal feed, and seed; during
the peak season they may also sell some fertilizer.
• The typical breakdown is: pesticides (65%), herbicides
(25%), and fungicides (10%).
• They typically sell 10 tons of CPPs per year.
• Competition at the importer level is fierce so dealers
are able to purchase on credit without collateral.
• With respect to services, dealers extend credit to
select customers, provide technical advice to farmers,
repackage their products into smaller quantities
(using generic glass bottles and plastic bags),
and distribute TPRI pamphlets with information
about correct use of CPPs.
Farmers
Farmers in Tanzania can be divided into four
groups: (1) large corporate farmers growing high-value
crops for export, (2) progressive farmers growing crops
for the domestic market and/or for export, (3) smallholder
farmers growing cash crops for export, and (4)
small-scale farmers growing food crops for home consumption
with the surplus being sold in local markets.
The large commercial farmers purchase CPPs in bulk
directly from importers and progressive farmers source
their inputs from independent dealers. Smallholders
who grow cash crops obtain their inputs via various
institutional arrangements set up by their respective
crop marketing boards, and small-scale farmers who
85
grow food crops purchase CPPs from independent dealers
or stockists.
Direct Importation by End-Users
In addition to the private sector, there are a number
of institutions involved in the importation and distribution
of CPPs and other inputs. The Coffee Board
has established a coffee input voucher scheme (CIS) to
finance the provision of CPPs and other inputs for coffee
farmers. Separate input funds have been established
in the cashew growing regions to do the same for
cashew farmers. A private company (Abbas Exports)
imports CPPs for the cashew industry, distributes them
to the input funds. The Cotton Lint and Seed Board
imports CPPs on behalf of the Cotton Development
Fund for direct distribution to cotton farmers. The two
tobacco-buying firms in Tanzania (Tanzania Tobacco
Leaf Company and Dimon) have established integrated
crop-loan schemes for the provision of CPPs and other
agricultural inputs to farmers. Tanzania Farmers Association
procures CPPs and other inputs locally and distributes
them to its members (smallholder farmers growing
food and cash crops) via its field offices. CPPs
comprise 90% of the business. In 2002 TFA had 5,000
members and sold a total of 4,842 liters of CPPs. However,
sales show a declining trend due to stiff competition
from private dealers (Table IV.2).
Ministry of Agriculture and Food Security
The Ministry of Agriculture and Food Security
(MAFS) procures CPPs for sale to farmers to be used
in large-scale operations against migratory pests, and
in some cases it applies the CPPs itself.
Table IV.2. Sales Trends for Agrochemicals,
Tanzania Farmers Association (1999 to
2000)