Agro-dealers and the Private Delivery of Seed and informationLessons from Kenya, Malawi and Zimbabwe by Hannington Odame & Leonard Oduori (Future Agricultures Consortium).

1. Agro-dealers and the Private Delivery of Seed
and information: Lessons from Kenya, Malawi
and Zimbabwe
Hannington Odame & Leonard Oduori
FAC-Tegemeo Seed Dialogue 2014
Strengthening African Seed Systems
July 14-15 2014, Nairobi, Kenya

2. Theory of Change?
‘Market-led technology adoption’
1. Encourage farmers to grow new crop varieties that
reduce losses and increase stability of yields
2. Enhance agricultural productivity through use of
synthetic fertilisers and soil mgt practices
3. Build more efficient input markets to deliver better seeds
and other inputs to farmers, and the output markets that
enable farmers to convert surplus production into profits
4. Support agro-dealers and the interests promoting their
role in the delivery of seeds , agro-inputs & information
Towards an African Green
Revolution?

3. Who is an Agro-dealer?
 Trained and certified stockists (AGRA)
 No legal definition in Kenya --Seed
laws recognize licensed seed
merchants & sellers
 Agro-dealers range from large multi-
product retailer-distributors, to small
sometimes mobile and seasonal
traders whose product range may be
limited either by market or finance.
 The specific types of agro-dealers
include: small business people,
vendors, lead farmers, agricultural
extension workers, employees of seed
companies/agro-chemical dealers.
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4. Commodity Focus

5. Value of Commodities Stocked by Agro-dealers(%)
Seeds
10%
Others
40%
Vet Drugs
5%
Human Drugs
6%
Fertilizer
8%
Pesticides
10%
Feeds
9%
Building
Materials
12%
Commodity Focus cont...
• Fertilizer & seed constitute
<10% of stock value
• Direct agric. inputs constitute
about 42% of stock value
• Commodity diversification
vital risk mitigation & cost
management
• Regional differences on stock
composition reported

6. • There is an assumption that agro-dealers operate in a free
market (AGRA (2013). Do they?
• Forming groups is promoted as a powerful strategy for
achieving economies of scale ==most agro-dealers will not
join associations if they do not see opportunities for direct
personal benefits and ==and it is common for successful
sectors to be dominated by a few dominant players
(oligopolies).
• Earlier Agro-dealer Programs (in East Africa) also assumed that
there would be no market failure or thin markets == but the
reality is there were input subsidies and sluggish demand,
especially for non-hybrids which affected the viability of the
business.
Assumptions in Agro-dealer
Development Programmes

7. • The seed sector is still developing in all SSA Countries with many
countries in early growth stages. Only Uganda, Zambia, Kenya, Malawi
and Zimbabwe are in the late growth stage (AGRA, 2013).
• Although there is limited agro-dealer in more than 8 countries surveyed
by AGRA, there is a growing/strong network in 10 countries.
• Most seed business is concentrated on maize despite the diversity of
crops grown in SSA. The low commercial value of other crops relegates
them to limited promotion and trade in specific regions or agro-dealers.
• The growth of agro-dealer business is therefore concentrated in high
potential areas for maize and in urban areas (Odame et al., 2011)
Overview of Country Experiences

8. • Political turmoil & radical land reform affected Zimbabwe’s
seed system  reduced quality seed supply and
undermined agro-dealer business growth
• Collapse of the seed system was exacerbated by seed relief
programmes implemented by the government and aid
agencies  bypassed the normal market chain where agro-
dealers operate
• In 2010, aid agencies experimented with ‘market-friendly’
input subsidy programmes  created distortions and
became objects of political manipulation and elite capture
• The result was the dominance of few politically-connected
players (oligopolies).
Zimbabwe

9. • Maize politics dominates Malawi’s electoral politics
• Interests of multinational seed companies, donors and
the state converged around the Agricultural Input
Subsidy Programme (AISP)
• The AISP has had some success at improving the
country’s food security raised its global profile
• But it has been exploited as a source of political
patronage  limiting access, diversity and affordability
of seeds for many producers
• There have been recent debates on the rethinking AISP
in Malawi == but is this change in status quo?
Malawi

10. • Kenya is the ‘poster child’ for the new Green Revolution
 key element: a growing network of ‘agro-dealers’
• But agro-dealers are spread unevenly across the
country  concentrated in the higher potential areas
• Changing structure of Kenya’s seed industry is
narrowing the choice (hybrid maize, GM maize?) 
leading to technological ‘lock in’
• Agro-dealership is risky business limited by capital
constraints and government interference
• Need to rethink the agro-dealer model  take account
for in farmer, crop/seed and geographical differences
• Consider promoting agro-dealership of both formal,
informal and intermidiate seeds
Kenya

11. Commodity Focus
• Fertilizer & seed
constitute <20% of stock
value
• Direct agric. inputs
constitute about 42% of
stock value
• Commodity
diversification vital risk
mitigation & cost
management
• Regional differences on
stock composition
reported
Value of Commodities Stocked by Agro-dealers(%)
Seeds
10%
Others
40%
Vet Drugs
5%
Human Drugs
6%
Fertilizer
8%
Pesticides
10%
Feeds
9%
Building
Materials
12%
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12. Are we overloading the carrier? Role of agro-dealers
in the delivery of agro-inputs & extension information
• Few agro-dealers have
key information sought
by farmers on seed
varieties they stock
• Many agro-dealers do
not assist in addressing
farmers’ concerns
about seed quality
• Lack of information and
sustainable demand for
novel technologies

13. Source of information on new varieties by gender: Average for 9
surveyed countries
Source: PASS Farmers survey, 2013 (with GRA’s use permission)
• The most common source of
information on new varieties was the
mass media, such as radio,
television and agricultural shows for
Burkina Faso, Malawi, Mozambique
and Zambia, which are often adverts
or programmes sponsored by large
seed companies; this was a more
important source for men than
women .
• Other farmers (neighbours or
friends) remain another important
source, and the principal source of
information on new information for
women farmers in all regions.
• Extension services of the MoA was
next most important source for
information in Kenya, Tanzania,
Ghana and Malawi: both for men
and women farmers, reflecting the
continued importance of the
service, particularly for women
farmers.

14. Preferred source of information on new varieties
Source: PASS Farmers survey, 2013 (With AGRA
permission)
• Generally, extension
services were
preferred by farmers:
particularly in Kenya,
Tanzania, Burkina,
Ghana and
Mozambique
• Radio/TV was the
preferred source of
information on seeds
for farmers in Uganda
annd Malawi.

15. 1. Agro-dealers are participating in GR, but capital, demand & parallel
govt/NGO input models limit them
2. Agro-dealers come in different types, sizes networks, and are supported
by different donors. Thus, there is need to characterise the different
types of agro-dealers and mainstream gender to ensure that opportunity
is given to women entrepreneurs in rural areas.
3. Running agro-dealership in remote regions or where government
subsidies are a popular political tool used to mobilise support are not
conducive to profitable and sustainable farm input business
4. Links between agro-dealers and local extension in many cases remain
weak. In some cases, extension workers themselves are agro-dealers,
AGRA (2013).
5. Agro-dealers face challenges in providing advisory services to farmers
where they are not trained as extension workers and depend on shop
attendants whose turnover is very high.
The General Findings in SSA
Countries

16. • Characterise the different types of agro-dealers and
mainstream gender to ensure that opportunity is given to
women entrepreneurs in rural areas.
• It is important to consider the profit-oriented nature of
agro-dealers. Most lucrative businesses are usually
dominated by a few well established market players.
• Strengthening and integration of agro-dealer
associations into government subsidy programs and
enable them to lobby for tax rebates or access import
license:
• Training of agro-dealers should be on-going, provided in
local languages and gradually transferred to
strengthened agro-dealer associations
REFLECTIONS

17. • Training should be given to agro-dealers and their
assistant attendants (‘managers’).
• Build capacity of agro-dealers to undertake multiple
roles: For example, agro-dealers play an important role
in delivering AGRA’s goal, not only for PASS but also
AGRA’s Soil Health and Marketing Programs.
• Work with extension services on building capacity of
agro-dealers to participate in extension and link them
with extension workers and lead farmers.
• Increase the participation of agro-dealers in different
extension approaches –including demos, mobile
deliveries and subsidised government/NGO input
programs.
REFLECTIONS CONT…

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