A vibrant market in farm machinery services is emerging in Africa.
In most parts of Africa, it is common to see humans and animals supplying the power for planting and harvesting. In the coming years, though, more and more farm machines—such as tractors, tillers, combine harvesters, and electric irrigation pumps—are likely to dot Africa’s landscape. IFPRI researchers studying agricultural mechanization in various countries have found that innovative ways of supplying farm machinery have been key to spreading access to equipment in Asia and may do so in Africa as well (see infographic).
Replacing Departing Workers
Urbanization and the growth of nonagricultural sectors are changing African economies. Workers are moving out of low-productivity agriculture and into higher-productivity nonagricultural work. As a result, farmers increasingly seek to mechanize farming operations to reduce their labor costs and free up family labor for other activities. Yet until recently little has been known about the process of mechanization. “Academic and policy research has all but ignored the role of mechanization in agricultural transformation in Africa since the 1980s,” says Xinshen Diao, a senior research fellow at IFPRI.
Experiences in some Asian countries, where mechanization has taken off in recent decades, show how the shift from human or animal power to machine power can occur. According to IFPRI’s research, the catalyst behind widespread access to machinery in Bangladesh, Thailand, Vietnam, and elsewhere is the rental market. Farm machinery rental services, along with improved seeds, have allowed small-scale farmers to benefit from scale efficiencies without creating large farms. In Bangladesh, more than 80 percent of land preparation, maize shelling, and rice threshing is now done by machine, despite declining farm sizes since the 1980s. The widespread use of small-scale machinery has allowed farmers to maintain productivity, despite declining farm sizes, rising wage rates, and the shift of labor out of agriculture. Less than 3 percent of Bangladeshi farmers own power tillers—but more than 70 percent of farmers use power tillers through the rental market.
Farmers who own machinery can make more money from rental services than from their original farm activities, as was found in Bangladesh and Thailand. In Ghana’s Ejura district, an entrepreneurial group of farmers is investing in agricultural machinery as a business. In addition to operating their own farms, they provide fee-based services to small farmers in nearby communities, in other areas of Ghana, and even as far as Burkina Faso and Togo. Mechanization through the rental market is proving highly profitable, and income from rental services is a key factor motivating farmers to invest in agricultural machinery.
IFPRI researchers also found an emerging rental market in the central highland region of Oromiya, Ethiopia. There farmers combine the use of tractor plowing with animal plowing when the rain comes late. Tractor owners are confident they will recoup their investment costs in five to seven years through rental services.
“Africa will be little different from Asia in the development of agricultural mechanization,” says Diao. “We can be confident that the private sector, including farmer-entrepreneurs, will lead this process. But there is also plenty of room for governments to play a facilitating role to make this process faster and benefit more small farmers.”
For more information on this topic:
- Photos from a May 2014 visit to Ethiopia by IFPRI researchers to study mechanization
- Mechanization in Ghana: Emerging Demand, and the Search for Alternative Supply Models, Food Policy, Xinshen Diao, Frances Cossar, Nazaire Houssou, and Shashidhara Kolavalli, October 2014
- Mechanization and Agricultural Transformation in Asia and Africa: Sharing Development Experiences, a workshop sponsored by IFPRI and the National School of Development at Peking University, June 18–19, 2014
- Tractor Owner-Operators in Nigeria: Insights from a Small Survey in Kaduna and Nasarawa States, Hiroyuki Takeshima, Hyacinth Edeh, Akeem Lawal, and Moshud Isiaka, IFPRI Discussion Paper 1355, 2014
- Mechanization and Agricultural Technology Evolution, Agricultural Intensification in Sub-Saharan Africa: Typology of Agricultural Mechanization in Nigeria, American Journal of Agricultural Economics, Hiroyuki Takeshima, Alejandro Nin-Pratt, and Xinshen Diao, October 2013
- Agricultural Mechanization in Ghana: Is Specialized Agricultural Mechanization Service Provision a Viable Business Model? American Journal of Agricultural Economics, Nazaire Houssou, Xinshen Diao, Frances Cossar, Shashidhara Kolavalli, Kipo Jimah, and Patrick Ohene Aboagye, October 2013
- The Rapid Rise of Cross-Regional Agricultural Mechanization Services in China, American Journal of Agricultural Economics, Jin Yang, Zuhui Huang, Xiaobo Zhang, and Thomas Reardon, October 2013