Contract farming keeps poultry keepers on track
20 December 2010
Ms Mwanaheri Nyangalio, a farmer from Ikwiriri, Rufiji District, Tanzania signs up for KuKuDeal. A large number of female farmers have benefited from getting capital, inputs and full advisory services under this innovative poultry contract farming initiative.
RIU Tanzania's preliminary research amongst the poultry keepers in its pilot commercialising indigenous chicken programme highlighted some concerns about the sustainability of the scheme.
A major challenge was that a variety of factors were conspiring to prevent poultry keepers from maintaining enough working capital in their business to keep the enterprises going. One factor was that there was a great deal of pressure on these resource-poor farmers to spend their money, for example to support their wider families or to buy consumer goods. This was limiting many farmers' ability to continue to operate their poultry enterprises after the first round of support from RIU.
So RIU Tanzania brokered the KuKuDeal. This is a contract farming programme designed for resource-poor-rural smallholder farmers who rear indigenous chickens. The KuKuDeal aims to ensure that farmers have access to operational capital and constant and timely access to inputs, advisory services and markets. This business initiative will help farmers to stabilise their production and grow - having at least 2-3 production cycles annually: previously they had just one production cycle annually or even one every two years.
KuKuDeal provides farmers, on a loan basis, chicks, feed for one month and all essential drugs, including vaccines, and also a household advisor for the entire contract period. After the chickens have matured, KuKuDeal buys 75% of the mature chickens: the total loan advanced to each farmer is then calculated and deducted and the farmer is paid the balance to enable him/her.
The remaining 25% of birds is intended to encourage rural poultry keepers to consume chicken at home as well as to explore other potentially lucrative markets.
After each cycle, the farmer will be assisted to immediately start a new production cycle.
KuKuDeal also aims to enable farmers to lower their production costs so that chickens become affordable to the majority of Tanzanians as a food security strategy.
In August 2010, RIU team introduced contract farming to farmers in Rufiji, Bagamoyo, Kibaha and Mkuranga districts in Coast Region. Day-long meetings were held in each district with farmers to introduce KuKuDeal and to facilitate farmers to sign contracts.
About 380 farming households signed contracts between August and September 2010. Out of these, a total of 174 households have started keeping poultry, with each household receiving between 100 and 400 chicks. The majority of farmers are keeping 200 chicks, a 100% increase from the first round where on average 100 chickens were kept per household.
First round distributions of inputs has been completed in Rufiji and Bagamoyo districts and is on-going in Kibaha District after which it will move to Mkuranga District. Contract signing is also continuing as more farmers sell their mature birds and prepare for new batches.
The programme has not yet introduced contract farming in Kisarawe District due to the current infrastructure challenges which negatively impact on prices for inputs and availability of support services. A meeting between the programme and local authorities in the district is planned to identify ways of reaching farmers in the district.
Initially farmers were cautious of the contract farming concept, but as their fears, concerns and questions were addressed through open discussion sessions farmers became enthusiastic and accepted the idea.
Most farmers said their initial reluctance was because they had had no previous exposure to or understanding of contract farming. It is a new way of working and they didn't know what it meant for them. The fear often related to the fact that there is a great deal of sharp practice in the sector - therefore, naturally, they had to be cautious. Others just didn't believe such a system could work.
A great deal of time was spent by the team talking farmers through the process, revisiting every detail and answering and re-answering the same questions and concerns until farmers were finally comfortable. After the first group of farmers received chicks and other inputs through the system, more farmers have signed contracts and are waiting to receive chicks.
There is a number of new farmers who were not reached during the first production round (September 2009 - July 2010) in Coast Region but are interested to begin poultry keeping. The contract farming model started working with farmers who went through the first production round only.
RIU is, however, considering the possibility of including the completely new farmers in contract farming, but with provision of intensive household advice since most of them have never kept a large number of chicks.
Read the story behind the work in Vera Mugittu's blog.
20 December 2010
Ms Mwanaheri Nyangalio, a farmer from Ikwiriri, Rufiji District, Tanzania signs up for KuKuDeal. A large number of female farmers have benefited from getting capital, inputs and full advisory services under this innovative poultry contract farming initiative.
RIU Tanzania's preliminary research amongst the poultry keepers in its pilot commercialising indigenous chicken programme highlighted some concerns about the sustainability of the scheme.
A major challenge was that a variety of factors were conspiring to prevent poultry keepers from maintaining enough working capital in their business to keep the enterprises going. One factor was that there was a great deal of pressure on these resource-poor farmers to spend their money, for example to support their wider families or to buy consumer goods. This was limiting many farmers' ability to continue to operate their poultry enterprises after the first round of support from RIU.
So RIU Tanzania brokered the KuKuDeal. This is a contract farming programme designed for resource-poor-rural smallholder farmers who rear indigenous chickens. The KuKuDeal aims to ensure that farmers have access to operational capital and constant and timely access to inputs, advisory services and markets. This business initiative will help farmers to stabilise their production and grow - having at least 2-3 production cycles annually: previously they had just one production cycle annually or even one every two years.
KuKuDeal provides farmers, on a loan basis, chicks, feed for one month and all essential drugs, including vaccines, and also a household advisor for the entire contract period. After the chickens have matured, KuKuDeal buys 75% of the mature chickens: the total loan advanced to each farmer is then calculated and deducted and the farmer is paid the balance to enable him/her.
The remaining 25% of birds is intended to encourage rural poultry keepers to consume chicken at home as well as to explore other potentially lucrative markets.
After each cycle, the farmer will be assisted to immediately start a new production cycle.
KuKuDeal also aims to enable farmers to lower their production costs so that chickens become affordable to the majority of Tanzanians as a food security strategy.
In August 2010, RIU team introduced contract farming to farmers in Rufiji, Bagamoyo, Kibaha and Mkuranga districts in Coast Region. Day-long meetings were held in each district with farmers to introduce KuKuDeal and to facilitate farmers to sign contracts.
About 380 farming households signed contracts between August and September 2010. Out of these, a total of 174 households have started keeping poultry, with each household receiving between 100 and 400 chicks. The majority of farmers are keeping 200 chicks, a 100% increase from the first round where on average 100 chickens were kept per household.
First round distributions of inputs has been completed in Rufiji and Bagamoyo districts and is on-going in Kibaha District after which it will move to Mkuranga District. Contract signing is also continuing as more farmers sell their mature birds and prepare for new batches.
The programme has not yet introduced contract farming in Kisarawe District due to the current infrastructure challenges which negatively impact on prices for inputs and availability of support services. A meeting between the programme and local authorities in the district is planned to identify ways of reaching farmers in the district.
Initially farmers were cautious of the contract farming concept, but as their fears, concerns and questions were addressed through open discussion sessions farmers became enthusiastic and accepted the idea.
Most farmers said their initial reluctance was because they had had no previous exposure to or understanding of contract farming. It is a new way of working and they didn't know what it meant for them. The fear often related to the fact that there is a great deal of sharp practice in the sector - therefore, naturally, they had to be cautious. Others just didn't believe such a system could work.
A great deal of time was spent by the team talking farmers through the process, revisiting every detail and answering and re-answering the same questions and concerns until farmers were finally comfortable. After the first group of farmers received chicks and other inputs through the system, more farmers have signed contracts and are waiting to receive chicks.
There is a number of new farmers who were not reached during the first production round (September 2009 - July 2010) in Coast Region but are interested to begin poultry keeping. The contract farming model started working with farmers who went through the first production round only.
RIU is, however, considering the possibility of including the completely new farmers in contract farming, but with provision of intensive household advice since most of them have never kept a large number of chicks.
Read the story behind the work in Vera Mugittu's blog.
| Commercialisation of local chicken enterprises. May 2010 (9:07) |  |
