1. Preliminary Results from AIMS Agro-dealer Development Impact Assessment IFDC-BASIS Workshop on The Long-term Impacts of a Temporary Agricultural Input Subsidy in Mozambique Maputo, Mozambique September 15 th, 2014 Alexander Fernando IFDC Mozambique

2. IFDC Baseline – 2007  Poor availability, accessibility and affordability of agricultural inputs 15 full-time/professional agro- dealers in Mozambique limited to major towns  Additional 75-150 seasonal ‘traders’ Average farmer had to go 300- 500kms kilometers to get inputs Inputs often >3x the factory price 1 fertilizer blender in Mozambique (MFC) Poor enabling environment No fertilizer policy, regulations 2

3. Agro-Dealer Development  Final link with farmers in the input supply chain 1. Business & technical knowledge transfer 2. Business linkage with input suppliers and technology transfer to farmers (demonstrations) 3. Strengthening support systems (credit, information, policy, etc.)  522 agro-dealers trained in Beira and Nacala Corridors (USAID and AGRA funding)  Association of input suppliers (AMPIA) established with district- level AD trade associations established, credit linkage with BOM  IFDC now focusing on strengthening local capacity in agro-dealer development and strengthening the input supply chain with focus on fertilizers Raw Material Supplier Basic Manufact urer Farmer Agro- Dealer Wholesaler Importer/ Blender 3

4. Agro-Dealer Network  Network of 300+ ADs in 5 Provinces, 70% in Beira Corridor  Of 201 trained ADs from AIMS, about 50% still in business  30% of ADs are ‘new’ (untrained)  Average distance to an AD <15kms from 300-500km  Fertilizer prices decreased ~50% and OPV seeds ~30%  Linked to credit through BOM and GAPI  Supplier credit through AFAP 4

5. Agro-Dealer Density 5 Source: Africa Rising (2012), World Bank Agri Business Indicator (2012), IFDC Preliminary Analysis

6. Agro-Dealer Profiling & Assessment  12 districts in 4 provinces, 109 AIMS ADs profiled, 65 surveyed, 153 farmers in focus group discussions 6 TrainedNon- trained # employees21 Yrs in Business9.76.2 Initial investment18,462 14,771 Shops owned11 Micro retailers41 Villages covered53 Radius of coverage27.917.3 Seasonal54%76% Preliminary Analysis Trained = 4.1m Non-Trained = 0.4m n=35 Source: IFDC Impact Assessment (2014 – in progress)

7. Trained Agro-dealers.. And constraints  Lack of access to credit (90%)  Low profit margin (43%)  Seasonal/low demand (40%)  High interest rates (36%) 7 Services Before training (%) After training (%) Technical advice989 Input credit to customers1166 Demonstration of farm inputs use657 Farm equipment lease323 Purchase of outputs2023 n=35 Source: IFDC Impact Assessment (2014 – in progress) Change after training…. Preliminary Analysis

8. Farmer Perception of Demonstrations 8 n=153 Source: IFDC Impact Assessment (2014 – in progress) Preliminary Analysis

9. Evolutions in Agro-dealer Development  Lack of access to credit and market information  Credit guarantee with BOM and link to AMITSA  Strengthen farmer access to output markets  ADs involved in output marketing  High cost of and focus on training large numbers  Focus resources on wholesale agro-dealers 9

10. Constraints  High cost of fertilizer due to poor fertilizer supply chain and high cost of credit for ADs  AD business model: need sufficient scale and year-round business, fertilizer sales needs to be balanced with more profitable seed and CPP business  ADs respond to market demand Low sales volumes & low purchasing power of farmers (vouchers can help) Need to develop the agri-business sector overall to increase farmer demand  Lack of AD accreditation to access credit and services  To be continued…. 10 Preliminary Analysis

11. Thank you! Alexander Fernando IFDC IIAM, Edificio de Quimica e Biotecnologia, 1st Floor, Room 14 Tel: +258-21-462914 afernando@ifdc.org www.ifdc.org 11