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Changing Farm Structure and Rural Transformation in Africa

This presentation discusses the changing farm structure in Africa, focusing on the rapid rise of medium-scale farms in certain regions and their impact on rural transformation. Key findings include the origins of these farms, the involvement of wealthy individuals in farmland investments, and the role of land transfers in rural development. It highlights the advantages of concentration of medium-scale farms and the policy implications for agricultural and land policies.

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Changing Farm Structure and Rural Transformation in Africa

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  1. Changing Farm Structure and Rural Transformation in Africa C4a team: T. S. Jayne, Milu Muyanga, Hosaena Ghebru, Mercedes Stickler, Caleb Stevens, Ward Anseeuw, Ayala Wineman, Kwame Yeboah, Antony Chapoto, Divan Van der Westhuisen Presentation at Food Security Innovation Lab Reflection Workshop March 5-6, 2019 Washington, DC

  2. Key findings • Rapid rise of medium-scale farms • Mainly in areas with substantial potential for area expansion (Ghana, Tanzania, Zambia, Nigeria) • Much less so in densely populated areas (Kenya, Rwanda, Uganda)

  3. Share of total marketed output under MSF is growing

  4. Key findings(continued) • Origins of these MS farms • Some small-scale farms successfully growing and commercializing • Relatively wealthy rural people using non-farm income to invest in farmland • Urban people investing in farmland

  5. Key findings (continued) • Rural transformation involves the transfer of land – allowing entrepreneurial people with access to capital to develop the land • Customary land is being allocated to investors • Land sales markets increasingly active / accepted • Governments are passing new land laws to allow these transfers to happen

  6. Key findings (continued) • In contrast to Latin America, MS farms in Africa appear to be a source of rural dynamism • Concentration of farmland among 5-10 ha farms promotes growth in rural NF employment and p.c. incomes (Chamberlin and Jayne) • Concentration of farmland among 5-10 ha farms attract mechanization rental markets for SS farms. • MS farm concentration attracts agro-input and service providers (Wineman et al., 2019) • Concentration of MS farms attracts LS traders into the area, improving market access conditions for smallholders (Burke et al., 2019)

  7. Key findings (continued) • Sources of productivity advantage for farms cultivating > 10 ha, which contributes to higher net output values per hectare (Muyanga and Jayne, AJAE, 2019) • Mechanization  reducing labor costs, which are rising in much of Africa • Greater intensity of cash inputs (fertilizers, improved seed, herbicides, etc)

  8. Mean land prices in Tanzania: +53.9% in real terms in 6 years Source: NPS 2009, 2011, 2013, 2015

  9. The influence of economic transformation and population density on the trajectory of agricultural transformation

  10. The influence of economic transformation and population density on the trajectory of agricultural transformation

  11. The influence of economic transformation and population density on the trajectory of agricultural transformation

  12. The influence of economic transformation and population density on the trajectory of agricultural transformation

  13. The influence of economic transformation and population density on the trajectory of agricultural transformation

  14. Pulled out of agriculture • Post-secondary education • Invested in skills • Will find decent jobs 10% Successful non-farm 40% Non-farm Pushed out of agriculture • Primary/secondary education only • No land; relatively unskilled • Will find poverty jobs – informal sector 30% Struggling non-farm YOUTH LIVELIHOODS OPTIONS 62% < 25 years Pushed into agriculture • Few productive assets • Poor access to land, finance, knowledge • High concentration of poverty 50% Struggling farm 60% Farming 80% Pulled into agriculture • Good access to land, finance, etc. • Good access markets, infrastructure, etc. • Diversified income sources 10% Successful farm

  15. Structural transformation pathway 60% Successful non-farm Policies • Inclusive economic growth • Infrastructure • R&D • Education • Post-secondary 10% Successful non-farm 40% Non-farm 30% Struggling non-farm YOUTH LIVELIHOODS OPTIONS 62% < 25 years Policies • R&D / ext. • Land access • Finance • Infrastructure and investments along value chain • Irrigation • Roads • Electricity 50% Struggling farm 60% Farming 40% Successful farming 10% Successful farming

  16. Policy implications for agricultural policy • The rise of MS farms does not invalidate the viability of a smallholder-led agricultural strategy • Maintain focus on supporting productivity of smallholder farming  which will facilitate equitable transformation process • Except in densely populated areas, MS farms appear to be a source of productivity growth for smallholder farming • Sustainable intensification strategies will be highly location-specific, according to economic dynamism and population density

  17. Policy implications w.r.t. land policies • Support assured tenure rights to existing users • Women in particular • Land banks? • Support land markets to allow “indigenous” rural people to be compensated for selling their land / not just losing it

  18. Thank You

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