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Financial Times: Senegal rice farmers offer lessons for rest of continent

By Neil Munshi in Thiagar

Once precarious existence transformed by state policies, aid and growers themselves

Hamdi Diallo used to scrape a living as a subsistence farmer in Senegal’s northern scrublands, toiling on a tiny plot of land with his bare hands from the age of seven.

 His son Baba rarely gets his hands dirty, working instead from a computer to direct operations of the family’s now-booming rice farm that last year had a turnover of $2m.

 “Rice is becoming a business,” says Baba, 34, whose 2,000 hectare property near the town of Thiagar, close to the Mauritanian border, has grown tenfold in a decade. “And that is changing our lives.”

The Diallo family’s success is emblematic of the transformation of Senegal’s rice sector.

The country has long imported most of its rice, the most important staple in the west African nation’s diet. But a systematic effort by the government in Dakar to develop rice farming with the help of international aid groups and a spurt in local lending to small farmers have helped production double since 2014 to nearly 1m tonnes last year, equal to about 40 per cent of annual consumption.

Agricultural self-sufficiency is a pillar of the government’s 20-year plan to transform the Senegalese economy. Development experts say the progress the country has made so far has important lessons for a continent that imports roughly $40bn of food a year.

“Production of rice is increasing every single day,” says Ousmane Sene, head of Dakar’s west Africa Research Centre. “Senegal wants to reach self-sufficiency . . . because it will create jobs” and bring down prices.

Africa has long suffered from a lack of agricultural development, and self-sufficiency will be crucial to the continent’s economic future as it seeks to meet the needs of fast-growing populations.

Hamdi, now aged 89, worked the dry land by hand with his father for decades to produce potatoes, millet and corn to feed their family. Following Senegal’s independence from France in 1960, he formed a rice-growing co-operative that had to sell all its grains to state-owned mills. In the late 1980s, he turned his business over to his sons, and in the ensuing years the system was privatised.

 

But it is only in the last few years that rice farming has truly been transformed, with the government dedicating resources to developing irrigated land rather than giving money to farm subsidies. “The new generation is much more free to do what they want [with the land],” said Hamdi, adding they are “more prosperous” as a result.

The Diallo family business extends beyond simple farming. Empty bags with their company logo printed on them are brought from Asia, to be filled with rice that has been milled and farmed, often by contract farmers, using machines leased by Baba’s equipment company and sourced from Chinese companies for which he is an agent.

Nearby, the Diallos’ chief business rival is neighbour Iba Sall, who also produces, buys, stores, mills and markets rice, while also acting as a lender to farmers. Mr Sall said that while he often struggled to keep up with demand, there was a problem with large foreign importers ignoring government mandates to buy local rice.

“The government could get more involved in managing imports,” said Mr Sall, who had hundreds of tonnes of long-grain rice left over from the harvest. “If they really put their foot down, that rice would be sold.”

But while entrepreneurial farmers have found success, most smallholders still struggle in one of the poorest and most remote regions of the world.

Adama Gueye, 60, heads a group representing about 200 small farmers whose lives are more akin to what Hamdi experienced as a boy.

“Sometimes we have weak harvests, and when you calculate the costs, it is difficult to pay back our credit, to have rice for our families and to sell,” he said. “For producers nothing really has changed.”

The same cannot be said for the landscape of Senegal’s rice-growing region located in the Sahel, the narrow semi-arid belt running the width of Africa, separating the Sahara desert from the savannah.

Lush paddy fields have in recent years sprouted up along the once largely barren Senegal River Valley, helped by two US-led aid projects.

The Millennium Challenge Corporation spent $471m to develop thousands of hectares of irrigated land and pave 120km of the main road through the valley.

USAID has trained the leaders of co-operatives representing tens of thousands of farmers to raise rice quality, and worked with Crédit Agricole, the national agriculture bank which is 25 per cent owned by the government, to create financing mechanisms for rice farmers.

Malick Ndiaye, managing director, said that until as recently as 2015, most farmers and millers would default. But new credit facilities combined with higher-quality rice, more irrigated land, and better farming practices have dramatically cut the defaults.

The bank’s rice farmer loan book has soared from 3.8bn Senegalese francs ($7m) in 2012 to 10.3bn francs in 2017. Lending for tractor financing has risen similarly.

Sir Gordon Conway, professor of international development at London’s Imperial College who recently visited the region, said Senegal’s approach was particularly compelling because farmers, including all-female co-operatives, had been brought into the system and had their entrepreneurial instincts encouraged.

He said it was “difficult to convey the excitement” he felt when he saw first hand the way rice farming was developing in Senegal. “It is something I’ve not seen before in Africa,” he said. “I don’t think this is going to fail.

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