September 9, 2017
In August, the AgResults Steering Committee unanimously agreed to extend the AgResults Nigeria Aflasafe™ Pilot for an additional year to further observe the impact of the pull mechanism on the market for Aflasafe™ aflatoxin control agents. During the additional year of the AgResults Nigeria Aflasafe™ pilot, spanning from October 1, 2018 – September 31, 2019, AgResults will offer a reduced prize of US $9.38 per metric ton of Aflasafe™ treated maize aggregated by the implementers. The reduced prize, will prepare the private sector for the Pilot’s close out while still providing an incentive to promote the use of Aflasafe.
Given the relative newness of the application of pull mechanisms to agricultural development programs, the reduced prize will provide an important learning opportunity for AgResults to gauge how a reduced prize affects private sector actors, both new and old. The additional year will allow AgResults to measure if legacy implementers will be able to continue to grow at the rate they did earlier in the pilot, or if the reduced prize also reduces their growth. It will also allow AgResults to see if new actors companies are attracted to the Aflasafe™ aggregation model in a market that does not have as high of an incentive.
An additional motivation behind the extension was for AgResults to increase the economic and nutritional outcomes of participating farmers by reducing their risk of exposure to the carcinogenic effects of aflatoxin consumption. Based on farmer survey data from Year 1 and Year 2 of the pilot, nearly 25% of the maize grown by participating farmers was retained for home consumption. Based on projections of the estimated 83,209MT of maize to be produced in Year 5, more than 31,000MT of maize will be used for human consumption. Much of the remaining maize will be sold to poultry producers who will use the high-quality maize as feed, indirectly improving the quality of poultry products available in the market. The aggregate volume estimate of AflasafeTM treated maize is 156,691MT over the six years of the pilot, which is expected to have a significant impact on the adoption of Aflasafe and the enactment of policies in favor of producing Aflatoxin reduced maize.
The AgResults Nigeria Aflasafe™ Pilot launched in 2012 and works to incentivize smallholder farmers to adopt Aflasafe™. AgResults offers a per unit payment premium to aggregators and grain traders for each metric ton of high Aflasafe™ maize (i.e., maize grains containing high levels of beneficial fungi) aggregated from farmers. By motivating smallholder farmers to use Aflasafe™ and providing technical assistance, aggregators help smallholder farmers to produce and consume Aflasafe™ treated maize, which is healthy and low in aflatoxin. Since the pilot launched, AgResults has offered US $18.75 per MT of Aflasafe™. To date, aggregators report receiving market price premiums for Aflasafe™ treated maize that are on average 13-17% above market prices and the number of participating smallholder farmers has grown from 1,000 in the first year to 14,000 in the fourth year. Aggregation in year 4 is estimated to be 39,197 MT and a cumulative total of 90,000MT. Because of the impact in Nigeria and the learning achieved, the product is being rolled out in eleven African countries sponsored by USAID and the Gates Foundation.