‘Rwandans will not be satisfied to live paycheck to paycheck, harvest to harvest, without accumulating wealth and financial security. They want to live close to the families they love and watch them thrive’ — President Paul Kagame.

The rules of economics apply to farming as much as they do to any other business: farmers invest in their land, planting supplies, and labour to produce enough to eat and sell. By every estimation, food production should be a profitable venture: everybody eats, and many economic sectors depend on agricultural products and agribusiness. Yet market systems often work against farmers.

The Government of Rwanda has embarked on becoming an upper-middle-income economy by 2035, through wealth creation investments and improving the quality of life for Rwandans. One key pillar of this vision is a sustainable, market-led agriculture sector, as captured in the Strategic Plan for the Transformation of Agriculture (PSTA4).

Formal markets offer the best returns, but they are best suited to smallholders with good proximity to markets and those who can consolidate their produce into quantities that allow them bargaining power. To help farmers with less land and who live far from such markets, our solution is to focus, at least in the interim, on aggregation, allowing farmers to consolidate their produce and making farmers part of a value chain. Working towards a profitable business model is a process, not an event, and interventions must be open to pivoting existing models or adopting new ones.

Integrate farmers into global value chains

For years now, the organisation I work for, One Acre Fund-TUBURA, has supported Rwanda’s vision through programs and supporting farmers in their journey to prosperity. As we deepen our work’s impact, TUBURA is partnering with the Government and private partners to invest in commercial agriculture, focusing on enabling smallholders to access markets for their produce. We are also de-risking postharvest value chains for farmers by offering premium prices, consistent markets, and prompt payments. Among other interventions, we are building sustainable value chains, like cold storage facilities, drying, and processing hubs), and small and medium enterprise investments like supporting exporters and processors to develop their infrastructural and professional capacities.

At the same time, TUBURA has begun trailing a contract farming program for broiler chicken as one way of linking smallholders to value chains. Under this project, we provide day-old broiler chicks, accompanying feed, and medication to farm families, who grow them for six weeks. The commercial partner then buys back the adult broiler chickens, taking ownership for further processing and sale, guaranteeing market access for the families.

In 2021, we helped Rwandan farmers sell over 37,000 chickens and 10 tons of avocados under our product buy-back program. By the end of 2022, we project we will help farmers sell 120,000 chickens and 100 tons of avocado. As part of our value-add strategy, we anticipate more involvement with local avocado oil processing industries to enable us to engage with more farmers, accommodate different grades and varieties of fruit, and prepare the groundwork for farmer certification. This will allow us to venture into export markets with higher profit margins for farmers. Additionally, our poultry work will see us partner more with local processors to impact more farmers.

Innovate, improve existing approaches

Empowering Rwandan farmers with innovative solutions is critical. Like many other countries, Rwanda is still dealing with the aftershocks of the Covid pandemic. Since January 2021, the cost of fertiliser and other essential inputs has risen – further influenced by the Russia-Ukraine War – posing a greater challenge for farmers who want to adopt improved inputs.

Agricultural stakeholders need to collaborate with the Ministry of Agriculture (MINAGRI) and the Rwanda Agricultural and Animal Resources Development Board (RAB) to propose and contribute to interventions designed to protect farmers. We could implement interventions like doubling down on complementary agricultural practices like composting and planting trees, updating fertiliser recommendations to move away from blanket recommendations, and exploring organic fertiliser and alternative fertiliser production.

Last year, we accelerated our commercial efforts and designed programs to support farmers in diversifying their income through investments in high-value crops. We believe in the power of entrepreneurship among Rwandan farmers to achieve wealth and prosperity. In our experience, farmers are willing to invest in diversified income streams if markets are guaranteed. Interventions like this can maximise their chances of success by ensuring contract farming models strike a balance between needs and production capacity — including being open to changing our strategy over time to ensure a sustainable commercial model.

Agricultural commercialisation often initiates a virtuous cycle that raises income levels, attains food security goals, encourages healthy consumption, and sustains rural development. While challenges abound on the path towards diversified income streams for rural populations, relatively low–investment opportunities exist to innovate and improve existing supply chain approaches. And, in partnership with relevant sector players, demand-side farmer engagement can help build markets to realise Rwanda’s significant smallholder potential, allowing commercial agriculture can create a truly market-driven agricultural system to help us build the Rwanda we want.

The writer is One Acre Fund-TUBURA Legal Counsel and Government Relations Lead

The views expressed in this article are of the writer.x