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Food value chain linkages and household food security in Tanzania

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Abstract

This article investigates smallholder market linkages in food value chains in sub-Saharan Africa, using Tanzania as a case study. Specifically, we analysed the status and drivers of market linkages among farmers, and their impact on agricultural income and food security. The analysis is based on nationally representative household survey data, using a combination of descriptive statistics and econometric approaches. Although most farmers in Tanzania are integrated into agricultural markets, their level of commercialization is very low, with an average of only 30% of their crop production sold. Around 15% of farmers who sell crops have access to potentially more rewarding market linkages (e.g. through cooperatives or contract farming). The econometric results show that, controlling for a number of confounding factors, farmers with market linkages are more commercialized, and receive significantly higher producer prices and crop income than those without such linkages. However, in spite of these positive results, we did not find significant differences in terms of household food security.

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Notes

  1. For example, one of the indicators of resilience against shocks is market participation (FAO et al. 2014).

  2. In Tanzania, they remain relevant in a number of export crop sectors, including tobacco, coffee, cotton, and cashew nut in some regions (Mruma 2014).

  3. The NPS includes an extended agricultural and rural development section as part of the World Bank LSMS-ISA (Living Standard Measurement Survey – Integrated Surveys of Agriculture).

  4. According to the NPS, these contract farming arrangements may involve agreements about quantity, quality or prices as well as credit access, input provision or extension services.

  5. More than half (55%) of farmers in the NPS sell their produce to private traders. In addition, around 20% of farmers in Tanzania sell each through open market, neighbours and friends, or to local merchants and groceries. We assume that most of these transactions occurred without prior arrangement between buyer and seller – i.e. on spot-markets. The fact that only 3% of farmers reported being involved in contract farming schemes supports this interpretation.

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Acknowledgements

This publication is a product of the Trans-SEC project (www.trans-sec.org), funded by the German Federal Ministry of Education and Research (BMBF) and the German Federal Ministry for Economic Cooperation and Development (BMZ). The views expressed belong to the authors and may not under any circumstances be regarded as stating an official position of the BMBF and BMZ. We wish to thank two anonymous reviewers and the journal editors for their valuable comments on earlier drafts of this paper.

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  1. German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE), Bonn, Germany

    Raoul Herrmann

  2. International Food Policy Research Institute (IFPRI), Washington, DC, USA

    Ephraim Nkonya

  3. Technical University of Munich (TUM) Campus Straubing of Biotechnology and Sustainability, Weihenstephan-Triesdorf University of Applied Sciences, Freising, Germany

    Anja Faße

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Herrmann, R., Nkonya, E. & Faße, A. Food value chain linkages and household food security in Tanzania. Food Sec. 10, 827–839 (2018). https://doi.org/10.1007/s12571-018-0792-5

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