As MeTL Group owns textile mills, cotton, cashew and palm oil processing plants; the group’s operations stand to benefit considerably from the development of its fallow land and investments in additional land for the large-scale cultivation of these products. The increased agricultural production will feed directly into the group’s textile mills, cashew processing plant and edible oil refinery, boosting production capacities.
Like most developing countries, more than 80 percent of the poor in Tanzania are to be found in rural areas. Nearly all of them are active in the agriculture sector as laborers or owners of a small piece of land that they cultivate for a living. In this context, land is a vital asset for food security and survival. In parallel, global population growth, rapid urbanization, and increases in incomes have resulted in a sharp increase in demand for agricultural products worldwide, leading to an expansion of cultivated area and leading investors to go out in search of new farmland. The global search for farmland has intensified in sub-Saharan Africa, including Tanzania.
Tanzania appears to offer good prospects for the expansion of the size of farming operations as illustrated by the following statistics:
- Only about 33 per cent of arable land in this country is cultivated compared to over 95 per cent for Malawi and Rwanda. Similarly, Ghana, Uganda and Ethiopia have used more than 80 per cent of their arable land.
- There is comparably limited land pressure on Tanzanian farmers since their average plot size remained constant at around 2.5 ha between 2003 and 2008. This is in sharp contrast with Uganda where average landholding has diminished by 40 per cent largely as the result of demographic pressures.
- Approximately 10 per cent of the farmland remains unused largely because of technological constraints and lack of human and financial capacity. For instance, in 2008 only 18.6 per cent of farms used an ox, 3.1 per cent a tractor, and 1.5 per cent a thresher.
- There are already quite a few medium to large farms in Tanzania: about 20 per cent of farm households report owning more than 5 ha of land compared to only 3 and 4 per cent in India and Uganda respectively.
These facts raise a number of questions:
- Should the government encourage farmers to obtain larger land holdings?
- Through which channels should big farms help smallholder farmers? Joint infrastructure? Technology transfers? Jobs?
- Is the Tanzanian government, including local authorities, equipped to negotiate and handle the needs of larger farmers?
- Will new large farms help resolve rising unemployment in rural areas and improve food security?