The Teff Value Chain on the Move

Power tillers are used on three-quarters of the mechanically cultivated area, and agricultural machinery is not only used on large farms but has also spread among smallholder farmers who own an average of 0.5 hectares of cropland. This growth has primarily relied on imported machines rather than domestic manufacture. The experience of Bangladesh can provide useful insights to many African countries seeking ways to promote agricultural mechanization. In collaboration with IFPRI and CIMMYT, nine African officials from four countries, including Ethiopia, Ghana, Kenya, and Nigeria, participated in a study tour in Bangladesh in November 2015 to examine how expansion in agricultural mechanization has occurred there. During the tour, African officials visited two major tractor importers, ACI Motors Ltd. and Metal Pvt. Ltd., as well as the largest agricultural machinery manufacturer, Alim Industries Ltd. The study tour participants also met with tractor and spare parts dealers, farmers, and staff members of public institutions, including the Department of Agricultural Extension (DAE) of the Ministry of Agriculture, the Bangladesh Agricultural Research Council (BARC), the Bangladesh Agricultural Research Institute (BARI), and the Bangladesh Rice Research Institute (BRRI). While the observations made during the study tour are specific to the particular context of Bangladesh, the lessons learned and insights gained on how agricultural mechanization processes in low-income countries can proceed rapidly should be applicable to other countries, including Ethiopia and Kenya. Two-wheel tractors (2WT), such as power tillers, have revolutionized the Bangladesh agricultural mechanization sector. They are used in a number of farming operations, including tillage, harvesting, transportation, and irrigation. In Bangladesh, tillage, using both 2WT power tillers and small four-wheel tractors (4WT), is the most mechanized activity, with more than 95 percent of 2WT used for tillage. Irrigation in the country was rapidly mechanized when power tillers, imported from Japan, were introduced. The predominant soils and topography of Bangladesh may have contributed to more readily mechanizing the practices of smallholder farmers using 2WTs. In the case of Ethiopia and Kenya, the use of 2WTs is more challenging in areas with heavy soils and the crops are rainfed. However, where soils are suitable and irrigated farming is profitable, 2WT use for cultivation may be possible in East Africa. The use of 2WT for harvesting and transportation may be even more widely applicable, as both activities are less constrained by soil conditions. The private sector in Bangladesh plays a significant role in the agricultural machinery sector. Machinery importers are well organized and have networks established throughout the country. Importers in Bangladesh provide after-sales services with warranties that help owners receive low-cost access to timely repair services and spare parts in the early stage of ownership after their purchases. Both ACI Motors Ltd. and Metal Pvt. Ltd. reported that they respond to calls for service from customers within 6 to 8 hours. In Ethiopia, importers provide limited after-sales services. A critical element in raising the use of agricultural mechanization is to induce suppliers to open sales and service centers in the major farming areas of the country. Bangladesh importers also provide credit to buyers. One importer, Metal Pvt. Ltd., has a special division exclusively dedicated to applicant screening, credit management, and repayment monitoring. Bangladesh importers and manufacturers promote the benefits of mechanization and inform farmers on available mechanization equipment using signboards, street advertisements, and other advertising. The companies also collaborate with the agricultural extension system. Similar collaboration between private agricultural machinery supply firms and the agricultural extension system is needed in both Ethiopia and Kenya. The private sector in Bangladesh meets the demand for machinery that is locally adapted for the farming systems in Bangladesh. Alim Industries Ltd. is focused on developing the frames and implements for power tillers, threshers, and other machinery, using imported engines from China to power the machines. This has created an opportunity for users to purchase the machines at cheaper prices than if all components were imported and provides them with easy access to parts and services. Importantly, importers, manufacturers, and dealers often have diverse business portfolios, which helps them mitigate many of the risks associated with engaging in agricultural machinery supply.