Commercial Farming in Africa

In this blog post, I will be writing unpacking a popular term surrounding agriculture: commercial farming. Some point towards commercial farming to combat the hunger problem of Africa’s growing population while others associate it with the exploitation of workers and land grabbing by the powerful and sometimes, foreign owners. Commercial farming, however, is a term carrying many meanings and its impacts can be extremely contextualised.  

A Guardian article, titled “Only modernised commercial farms will fill Africa's plate, economists warn”, was released in 2017. The premise was that, with a rapidly growing population, African agriculture needs to increase its productivity through the modernisation of its farms. Small holder farms constitute about 80% of all farms in Africa and most are too small to implement mechanisation feasibly. To remedy this, increasing farm sizes, and adopting a commercial farm model will bring about increases in yields. These benefits will trickle down to real incomes earned by farmers, thereby concurrently increasing food security and spurring economic development. Additionally, with farming holding no allure for many of the younger, more educated generation, there is a greater impetus to make farming more financially attractive.

Comments to the article were unsurprisingly scathing. A recurring theme was how methods previously successful in the ‘West’ could not be easily replicated and more foreign corporate involvement might remove some farmers from employment altogether. Colonial images were also evoked, with foreign investment seen as another avenue for exploitation of African resources. 

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Such discussions are hardly new, with African agriculture having had several attempts at commercial farming in the past (Hall, Scoones & Tsikata, 2015). Since the 1980s, African governments have tried reforming their agricultural industries by developing conducive environments for private investment and in the 1990s, implemented land reform “to promote land markets, titling and registration in several African countries” (Hall, Scoones & Tsikata, 2015, p. 7). The lasting dilemmas of African agriculture and the unsuccessfulness of shifting towards societies predicated on industries and services have driven problems of “food insecurity, food imports, rampant rural-urban migration and unemployment” (Hall, Scoones & Tsikata, 2015, p. 6). Within such a context, the narrative of how technological spill over through foreign direct investment improves the livelihood of farmers,  food production, jobs, accumulation of foreign exchange and industrialisation opportunities is extremely tempting (Hall, Scoones & Tsikata, 2015).  Different forms of commercial farming have existed throughout African history but Hall, Scoones and Tsikata (2017) have examined three models of commercial farming in Ghana, Zambia and Kenya that are currently pertinent to the African agriculture landscape: plantations, contract farming and medium-scale commercial farms. Instead of the ways they affect agricultural output, the focus will be on how they engage local African communities.

1.     Plantations – large estates of land with permanent or temporary labour, existing as agribusiness farms with linkages to value chains and tend to grow cash crops. These large tracts of land often necessitate state land becoming privatised or the company having long-term tenure, which potentially causes the eviction of residents or even farmers in these spaces (Hall, Scoones & Tsikata, 2017). While these large estates may achieve greater economies of scale and productivity, they have poor linkages with local economies and provide comparatively lower financial benefits in their locality (Hall, Scoones & Tsikata, 2017). Employment may be seasonal or permanent (depending on the crop) and salaries are competitive (Hall, Scoones & Tsikata, 2017). However, they tend to favour migrants that transfer their earnings home instead and with their needs being fulfilled at the plantation, there is little impetus to spend money locally (Hall, Scoones & Tsikata, 2017). 

2.     Outgrower/contract farming – smallholders providing their land and sometimes their labour to produce crops and have contractual agreements with firms. These contracts can be temporary or seasonal, providing a variety of flexible employment options. Contract farming is often seen as mutually beneficial – it retains local ownership of land and these contractual agreements provide an outlet for the crops produced, which they might otherwise not have (Hall, Scoones & Tsikata, 2017).  How these contractual agreements differ affect the earning potential of these farmers and Hall, Scoones and Tsikata note that in their study that outgrowers employed in Zambia Sugar Magobbo fared much better compared to those in employed in Frigoken and Finlay’s in Kenya. While those in Kenya were treated as individual producers, in Zambia, they were more akin to shareholders who provided the land for farming instead of performing the farming itself (Hall, Scoones & Tsikata, 2017). Thus, there is considerable differences between the contracts negotiated.   

3.     Medium-scale commercial farms – large tracts of land owned by independent farmers or small companies. The significance and number of medium-scale commercial farms have been increasing within Africa and typically owned by farmers with substantial nonfarming capital (Hall, Scoones & Tsikata, 2017).  These farms have greater linkages with the local economy than plantations, being a local source of employment and relying on local services (Cotula & Leonard, 2010). Nevertheless, their land acquisition activities by relatively richer investors may deprive other farmers of land and potentially establish a new group of elites within rural farming communities (Hall, Scoones & Tsikata, 2017).

Farmers of the future?

Another trend is how youth perceive farming activities. Generally being more highly educated, there is a tendency for youth to be drawn towards urban employment opportunities rather than farming (Hall, Scoones & Tsikata,2017).  Additionally, paying family members (predominantly adult sons) for labour on farms is increasing, especially for the management of commercial farms, given that they forego alternative employment options (Hall, Scoones & Tsikata, 2017). 

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Conclusion

These development of these 3 models of farming and of the youth is worth noting in the near future. Of the 3, plantations seem to generate the least returns for the local economy, being the most isolated. However, there is a need to examine to what extent contract farming provides financial security for farmers and whether medium-scale farms will create more inequalities. Nevertheless, the impacts of commercial farming vary from place to place and cannot be captured simply (Oya,2013).