Access to Mechanization Is a Path to Productivity in Nigeria

Nigeria is rich in agricultural resources. Its land, rainfall and climate make it an African agricultural powerhouse. Total cereal production has steadily increased from 7.8 million tons in 1960 to 25 million tons in 2016.1 Even with its oil resources, agriculture is the base of the nation’s economy and the largest source of employment.2

Yet the agriculture sector has struggled to meet its potential. Agricultural output grew by an average of 1.2 percent per year from 2005 to 2014, not nearly enough to meet domestic demand.3 In 2016, Nigeria imported 4 million tons of rice, despite being the largest rice producer in Africa.36 Substantial growth in agricultural output will be needed if Nigeria is to feed more than 300 million people in 2050.

One of the reasons for the gap between domestic production and consumption of rice and other cereals is that most of Nigeria’s farmers are operating at very small scales, with little access to inputs, such as improved seeds, fertilizer and pesticides, or to mechanization. Mechanization use has increased just two percent annually (2005–2014).4

In April 2018, Alluvial, a Nigerian company that works with smallholder farmers, and John Deere through its distributor Tata Group, formed a partnership to lease up to 300 tractors to be used by 100,000 smallholder farmers in the Niger Delta region of Nigeria. Oil wealth dominates the economy of the Delta region, but most people rely on farming for their food and livelihoods. Rates of food insecurity, malnutrition and poverty in the region are high.

“With the proper inputs and mechanization, farmers could produce more than $300 million worth of rice per year, at current prices,” says Dimieari Von Kemedi, founder of Alluvial.5

To increase the competitiveness of small-scale agriculture in the Niger Delta region, Alluvial groups together farmers operating on contiguous parcels of land. They aggregate the farmers’ output to sell on commercial markets and provide inputs, such as seeds and fertilizer, at competitive prices.

Photo credit: Rain Vedutti Photography

Alluvial’s farmers will be able to rent a John Deere tractor to plow, harrow and harvest. The cost per acre for one growing season is around $100. The tractor leasing program will bring mechanization to farmers cultivating 460 square miles of cropland.

The Nigerian government is also investing in mechanization leasing programs. In May 2018, the government announced the purchase of 10,000 John Deere tractors over the next five years. Smallholder farmers will be able to rent the tractors from local service providers for five percent less than the market price for mechanization rental.

“Nigerian farmers are knowledgeable, motivated and passionate. We believe in the country and are looking forward to partnering with Nigeria,” said Mark Von Pentz, President of John Deere Agriculture & Turf Division — Europe, CIS, Asia, Africa and Global Tractor Platform.6

For small-scale farmers in Nigeria, mechanization service rentals are a path to better land and labor productivity. Expanding access to these technologies will help lift farmers out of poverty while increasing food availability for Nigeria’s rapidly growing population.

 


 

  1. FAOSTAT Online, Nigeria Country Indicators, accessed August 23, 2018.
  2. Nigeria At A Glance: online summary, UN Food and Agriculture Organization, http://www.fao.org/nigeria/fao-in-nigeria/nigeria-at-aglance/en/, accessed August 22, 2018.
  3. Nigeria At A Glance: online summary, UN Food and Agriculture Organization, http://www.fao.org/nigeria/fao-in-nigeria/nigeria-at-aglance/en/, accessed August 22, 2018.
  4. Mechanized: Transforming Africa’s Agriculture Value Chains, Nigeria, Malabo Montpellier Panel, 2018.
  5. “John Deere and Tata sign potentially groundbreaking deal in Nigeria,” Financial Times, April 30, 2018.
  6. “Nigeria to procure tractors from agricultural company,” Voice of Nigeria, online, https://www.von.gov.ng/nigeria-to-procure-tractorsfrom-agricultural-company/, accessed August 22, 2018.

Photo right: Irrigated rice field in Nigeria. Photo by Arne Hoel, World Bank.

 

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