Kenya On-Farm Storage Pilot

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Kenya On-Farm Storage Pilot

On-Farm Storage in Kenya 

Post-harvest losses of grain in the developing world are extensive, leading to lower incomes among smallholder farmers and farm-level food security issues. This problem is particularly acute in Sub-Saharan Africa. Overall post-harvest losses in Sub-Saharan Africa are estimated at US$1.6 billion per year, or about 13.5% of the total value of grain production ($11 billion). Moreover, insufficient on-farm storage solutions often lead farmers to sell after harvest and receive lower prices when the market is flooded. Improved smallholder access to storage solutions could therefore lead to meaningful economic benefits if more grain was stored for sale or for later consumption.

The Kenya On-Farm Storage pilot aims to address post-harvest losses by facilitating the development, marketing and distribution of on-farm storage solutions to small farmers. The pilot focuses on storage of maize and other grains in Kenya. Maize is the most important staple food in Kenyans’ diets, providing roughly a third of the caloric intake for Kenya‘s population. The pilot will target the Rift Valley and Eastern Region.

  • The Rift Valley produces approximately 60% (2 million MT) of Kenya’s maize.

  • The Eastern Region, the third largest maize-producing region in Kenya, is known to experience significant losses from the large grain borer (LGB).

Pilot Pull Mechanism

The pull mechanism has three primary objectives:

  1. To increase the economic welfare of smallholder farmers through improved access to storage devices that minimize crop losses and enable smallholders to store maize throughout the year for food security and for price speculation, to sell their maize later at higher prices.

  2. To help catalyze a sustainable long-term market for smallholder farmer storage devices in Kenya.

  3. To test an innovative model of engaging the private sector to serve smallholder needs, with potential future applicability to the delivery of other goods and services to smallholders.

The pull mechanism will target companies that produce storage devices to innovate and adapt existing on-farm storage devices and sell them to smallholder farmers. The pull mechanism will not specify the technologies, nor the marketing or distribution systems. Instead, companies will be encouraged to solve three issues – cost-effectiveness, knowledge transfer to smallholder farmers, and economic benefit – in whatever approach they choose.

Pilot Structure

The pull mechanism is a combination of performance-based grants provided to companies based on verified sales of approved storage devices that meet a minimum 21,000 MT of Useful Life Adjusted Storage Threshold.

Kenya Pilot Mechanism Graphic

Anticipated Results

The proposed pilot is projected to reach approximately 480,000 smallholder farmers and create at least 172,000 MT of new storage capacity for grain in the Rift Valley and Eastern Region. The pilot is projected to generate US$14 million in smallholder benefits from the storage of high quality grain, the ability to spread sales into higher-priced periods and a reduced need to buy grain for household consumption, especially during non-harvest months. The pull mechanism is expected to enable participants to test marketing strategies that can be used for distribution of storage solutions and other products targeting smallholder consumers. If proven effective, these models can be expanded to other regions of Kenya and Africa.

Results To-Date

  • In the third year of operation, the Kenya Pilot has nine companies working in the Rift Valley and the Eastern Province. 
  • These companies have sold a combined 704,776 devices.
  • Smallholder farmers now have an increased capacity to store 209,195 MT of maize.

Pilot Resources

Aflatoxin Contamination in Nigeria

Aflatoxin contamination is a global problem affecting 4.5 billion people in developing countries. Among the most carcinogenic substances known, aflatoxins are produced by some species of Aspergillus fungi that are most commonly found in grains such as maize and groundnuts. In Nigeria, where smallholders produce over 70% of the nation’s maize crop, the International Institute of Tropical Agriculture (IITA) estimates that up to 60% of maize may be aflatoxin contaminated in some years.

Although technologies to reduce aflatoxin contamination have existed for decades, barriers in the market, among other reasons, have prevented widespread adoption. Specifically, the lack of enforcement of aflatoxin contamination regulation limits incentives to investment in its control. In this setting, a pull mechanism focusing on increasing the adoption of existing aflatoxin control technology has the opportunity to improve the health and economic benefits of aflatoxin mitigation to farmers and other actors in the value chain.

Pilot Objective

The Nigeria Aflasafe Pilot focuses on incentivizing the adoption of Aflasafe™, a new biocontrol technology, by smallholder maize farmers. Although several technologies are available to address aflatoxin contamination, biocontrol represent the most promising technology for pilot support because it addresses aflatoxin contamination and is ready for deployment in Nigeria. Using native Aspergillus strains incapable of producing aflatoxin to crowd out aflatoxin-producing strains, Aflasafe prevents aflatoxin formation in the field and continues to protect grains from contamination through transport and storage. Extensive field tests of Aflasafe™ in Nigeria have shown an average of 80% reduction in aflatoxin levels in treated crops, and up to 99% reduction in some cases.

Pilot Structure

The Nigeria Aflasafe™ Pilot provides economic incentives to smallholder farmers for the adoption of Aflasafe™, an aflatoxin control technology. The pilot is designed to demonstrate a successful model for increasing smallholder adoption of biocontrol technology in Nigeria by reducing barriers to the widespread adoption of Aflasafe through a premium per-unit payment for maize verified to contain a high prevalence of Aflasafe strains in grains.

The pilot incentivizes the adoption of Aflasafe through managers of contract maize farming arrangements (known as aggregators), who are capable of interacting efficiently with smallholders and aggregating aflatoxin-free maize for sale in downstream markets. By providing smallholders with incentives as well as assistance to produce high-Aflasafe™maize, managers are able to aggregate and trade commercial quantities of healthy, aflatoxin-free maize.

The pull mechanism in the pilot builds a core group of participants to anchor the market for Aflasafe™, expanding from 1,000 farmers in Nigeria in the initial year (year 0) to 31,000 farmers in year 4. It also features technical assistance with the goal of increasing participating farmer yields. Farmers that receive training are expected to share their knowledge of production technologies with other farmers that participate in the program.

The structure of the pull mechanism features per-unit payments for performance that are tied to the number of kilograms of maize treated with Aflasafe™ collected from maize aggregators. Each aggregator will receive a premium payment equal to US $18.75 (3,000 Naira) for every metric ton of high-Aflasafe™ maize that is delivered to designated collection points. This payment corresponds to a premium rate of 5% to 13% depending on the current price of maize, which typically ranges from $250 to $375 per ton in Nigeria and corresponds to the long-term market premium level that is expected when the benefits of low-aflatoxin maize is more widely acknowledged.

Results

  • More Aflasafe™ Treated Maize – The Nigeria Aflasafe™ Pilot is estimated to incentivize a total production of approximately 480,000 metric tons (MT) of high-Aflasafe™ maize over the life of the project (4 years).  During pilot year 1, nine Implementers worked with over 3,200 farmers, 14% of whom were female. These farmers cultivated on average 1.6 ha of land and produced over 13,300 MT of maize, of which Implementers aggregated approximately 54%. By the fourth year of the pilot, nearly 31,000 participating farmers are expected to sell 200,000 tons of high-Aflasafe™ maize, roughly 3% of Nigeria’s total maize production, and consume roughly 60,000 tons. 
  • Reduced Aflatoxin Levels – In year 1 of the Pilot, aflatoxin concentration averaged less than 2 ng/g in 97% of maize grain lots harvested from Aflasafe™-treated fields, well below the 20 ng/g US acceptable limits and 4 ng/g European limits.
  • Higher Margins - The incremental net economic benefit to smallholders is estimated to average US $270 per hectare per year, compared to an average of roughly USD $150 per hectare in total pull mechanism costs. During the first year of the Pilot, farmers sold maize at $10 to $50 over the prevailing market price.
  • Increased Yields –Data collected from the 3,200 AgResults Aflasafe™ farmers during the Pilot’s first year showed that their farms yielded more than 70% the normal yield of 1.5 tons per hectare due to use of improved seeds, fertilizers and crop management practices.
  • Improved Health Outcomes – In addition to the impact on production, the Pilot is also expected to deliver health benefits among over 70,000 smallholder family members, not including downstream maize consumers.

Important Links

For procurement documents and to apply for participation, visit the Get Involved page of this website. 

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