A new agricultural gradient pursuing to potentially change the status of farming communities in Ethiopia is about to take upshots. A reform package in the sector comes with policy-based remedies to fundamentally alter the agriculture sector where the long-existed land tenure system is about to be brushed up.
While a short, medium- and long-term plans in the making, the establishment of shareholding farms, cooperative banks and insurances are to be introduced to Ethiopia’s agriculture sector. Well informed sources with the Ministry of Agriculture have revealed to The ReporterMagazine that a new policy document has been drafted detailing the government’s intentions for the sector in the coming ten years period. The process is basically part of a reform package Prime Minister Abiy Ahmed (PhD) has introduced and keenly employing in major sectors of the economy.
The major goings-on that are thought to transform the sector hangs around changing existing laws and procedures to allow farmers, pastoralists and potential private investors interested in large scale commercial farms that will swing the current rural land tenure system into a shareholding base.
Doing that alleged and lets farmers to transfer their farm lands and related properties to third parties and a legal system will be created to back farmers exercise these rights. The sources have indicated that the government plans to implement shareholding farms as long-term targets enforecable within the coming 10 years.
Within the scope of 10 years, farmers will not only have shareholding rights on their farms. They will be legalized to set up financial institutions that will allot and provide resources to their needs through cooperatives. Pastoralists will also be brought into this system.
However, prior to the system that governs shareholding farms brought into practice, the government intends to launch an integrated rural land management policy and planning. Here, new land valuation and land consolidation systems and legal frameworkswill be put into actionand assources claim, the job has already begun.
It has become clear that the government is contemplating to embark on a short, medium- and long-term period reform packages for the agriculture sector that are basically identified to take effect beginning from one year to ten years. The short-term targets are set to be executed in one-yeartime, medium ones rolling in five years and the long-term targets will be winding up in ten years.
So much so is going on within the Ministry of Agriculture that some high-level officials approached by The ReporterMagazine for official interview have declined or were not willing to give details. While others declined to be mentioned, have suggested that such reports shouldn’t be published, telling the policy document being at its infancy and discussions are ongoing. the anonymous official tries to dictate “once the policy is ready, it will be made public and media will be given access”.
However, for DemisChanyalew (PhD), a senior agroeconomic expert who, apart from his academic and expertise roles, usually participates in high level policy discussions and advisory skills,the new policy that signaled to alter the agricultural land system he says is not a surprise. In fact, Demis argues that since 2008 he was recommending to the government’s policy makers to introduce such systems.
According to the veteran economist, farmers should be given all opportunities thoroughly including guarantying their farm lands. He advocates, farmers should be left to become entrepreneurs and their own decision makers. He decisively challenged the government long ago stressing the need to have smaller holder farmers to have access for investments and should also be considered as “potential investors” they have resources at hand, such as land and labor. “Farmers need to organize themselves to become investors or may need to demand t be considered as shareholders in investment ventures coming to their vicinities”.
Adding further the economist beefs up his ideas quoting from his extensively written book: “Ethiopia’s indigenous policy and growth: agriculture, pastoral and rural development”, and says:“if farmers are becoming entrepreneurial and understand the investment environ, then they should also need to be considered and let be organized as corporate investors or become shareholders on basis of what they could contribute from the landholding rights they might have”. The government needs to be more proactive and “shouldn’t necessarily politicize policies”, Demis said. Hence, he alludes the government’s initiatives and yet advises the government not to backslide with the plans it has drafted.
In fact, the government has become more proactive towards agriculture and has started to incentivize the sector. Duty free privileges for machineries, excise tax exemption for brand new tractors and combines are in the making.
Within the short-term plans, the government is soliciting to ban the importation of palm oil and within two years, the decision is expected to be enforced to enable local edible oil producers to reap the USD 500 million or so food oil business. Like that, wheat production has been launched and huge expanses of lands are about to be explored and this time, it’s the low lands that will be harvested.
That idea of exploiting low land areas where pastoralists and quasi-pastoralists reside on 60 percent of the nation’s land as Daniel Behailu wrote in his book: “transfer of land rights in Ethiopia: towards a sustainable policy framework”, he favors low land agriculture. He claims that land tenure insecurity was perpetuated through land policies to date. And we that let’s see how wheat will make Ethiopia a self-sufficient producer even in the shorter possible years.
Based on that timeframe, the short-term targets are set, and priorities are given to wheat import substitutions and intensive local production. It is expected to harvest an expanse of 15,000 to 850,ooo farmlands both in lowland and highland areas. Some policy documents earlier have suggested that initial considerations for short term wheat production is about to embark on 60-hectare plot of farms will be piloted on lowland areas. However, in highland areas, 850, 000 hectares of wheat farms will be harvested.
This approach with all its theoreticalaspectssuggests that, in one harvesting season some 4.7 million quintals of wheat to be reaped, representing an estimated value of USD 142 million. According to by the estimates of the Ministry of Agriculture, the proposed local wheat production will contribute to substitute and reduce 28 percent of the imported wheat.
That being proposed by the new reform package, the United States Department of Agriculture (USDA), staff report for the Global Alliance Information Network (GAIN) published in 2019 presented that, Ethiopia’s wheat production for 2019/20 will reach a projected 4.6 million metric tons. The wheat production estimate for the 2018/19 has been reported to reach 4.5 million metric tons. Current estimates by the USDA indicated that wheat production areas will require a 1.66 million hectares to yield 4.6 million metric tons. However, “an increase, this level of production still does not meet domestic needs”, the report claims. Hence, an induced scale of wheat importation has been essentially critical and last year alone, some 1.5 million metric tons of wheat was required to be imported.
The staffs at the USDA suggested that the projected increase of wheat production is associated to the most part that the farmers in wheat have growing belts have started using mechanized farming systems, especially during harvest to boost productions. “In the past, the country has usually imported 30 to 35 percent of the domestic wheat demand with no significant volumes of grain exports due to official export restriction on grains”, the report claims.
In the 2018/19 optimal rainfall and reduced disease and pest pressures resulted in better yields with a production estimate of nearly 4.5 million tons. In 2018/19, almost 1.65 million hectares were dedicated to wheat cultivation. Yields are close to 2.7 tons per hectare.
While USDA’s report notes Ethiopia being amongst the top three wheat producers in Africa, wheat accounts for about 20 percent of the nation’s total cereal production and more than 90 percent of Ethiopia’s wheat production is grown on small farms without irrigation, most of which are in the highlands. Out of the total wheat production, 75 to 80 percent is hard red wheat used to make bread and durum makes up roughly 10 to 15 percent. There are approximately 4.7 million small-scale wheat farmers in Ethiopia, which accounts for about 95 percent of wheat production and large-scale commercial farms account for only 5 percent of the total production.
For the year 2019/20, wheat consumption trend is estimated at 6.3 million metric tons up roughly due to food aid requirement for more than eight million people in the country.In order to close the gap between demand and supply of wheat, the government has been incessantly importing wheat from the black sea region for many years.
There are more than 600 small and large flour mills in Ethiopia, with a total production capacity of about 4.2 million tons of wheat flour a year. However, it’s yet to be known how these millers are going to be integrated in the new wheat production project the government has launched to deepen local productions.
technical, financial and marketing system need to be established by the government, in order to create prudence input supply and usage system, the government will allot sound financial resources to the sector.