Smallholders will be able to sell their maize to NFRA, while ten percent of NFRA’s purchases will be reserved for smallholders participating in WFP’s Purchase for Progress (P4P) pilot in the country.
The new agreement could quadruple the size of current P4P purchases in Tanzania, taking purchases from a 2011 high of 4,300 tons to 20,000 tons annually. Under the previous arrangement, WFP was already able to buy 90,000 tons of maize from NFRA. WFP uses the food bought from NFRA for its food assistance programmes in the region, such as in Kenya, Somalia or South Sudan.
“This is a moment to reflect on the potential and strategic position Tanzania as a country has as a food basket and market to its neighbouring countries”, said Mohamed Muya, Permanent Secretary in the Ministry for Agriculture, Food Security and Cooperatives. “The potential is immense and we cannot lose the moment”.
Muya named WFP as a strategic partner in assuring a reliable market for grain produced in Tanzania, contributing to improved income and livelihoods for Tanzanian farmers. WFP will provide technical support on food handling and warehousing.
Smallholder farmers and their associations have few marketing opportunities, most sell at the farm gate to traders or aggregators at discounted prices. Together with partners, P4P enhances farmers’ capacities to raise productivity, store commodities and improve quality.
“This marks a significant shift in Tanzania’s role as a regional grain trader,” said WFP Country Director Richard Ragan. “Not only is the agreement good for the overall economy, it's good for the small farmers who make up 75 per cent of Tanzania’s workforce.”
WFP is expected to buy more than 400,000 tons of maize from NFRA between July 2011 and July 2013. These purchases will supply NFRA with a fresh infusion of capital and an opportunity to rotate and renew its stocks, enabling the agency to buy more food from Tanzanian smallholders.