Way back in the early 60s, the sisal industry was the best organised commercial agriculture in East Africa with Tanzania leading in terms of production, followed by Brazil.
In 1964, for example, Tanzania produced 240,000 tons of sisal fibre from an area of 487,000 hectares of sisal.
In effect, the industry was the largest single employer and the crop, the major foreign exchange earner for the economy.
Up to 1967, the industry was in private hands. But with the proclamation of the then famous Arusha Declaration, all major economic activities became under state control where over 50 percent of the industry was nationalized.
Most owners of such entities went in confused circles, not knowing what to do next. Along with the move, were houses, high-rise buildings whose value was estimated to cost 100,000/- and above.
The nationalized sisal estates were bestowed in government hands with a public parastatal –Tanzania Sisal Corporation (TSC) formed. Later in 1973, the entity became Tanzania Sisal Authority (TSA).
Only three companies – Amboni Limited, Ralli Estate and Karimjee Agriculture Limited were spared, contributing to the rest 50 percent of the country’s sisal production.
Suddenly, the industry experienced a worst ever decline in the 1970s and 1980s – with production levels pushed down from 230,000 tons in 1964 to 20,485 in 2000.
Among the reasons for the severe slump was neglect of agriculture as an integral part towards national development.
The other, according to agronomists, was the setting in of the synthetic fibre use by developed countries, ending market share of sisal in the world.
Faced with the competition, the product fetched very low prices, while costs of production remained the same-resulting in low profit margin.
With too much on its shoulders, the government decided to privatise the firm. After a bidding exercise, Katani Limited, a processing, marketing and provider of technical and extension services in sisal industry, came out the winner.
Katani Limited, a privately owned company, operates five factories. These are Magoma, Mwelya, Hale, Ngombezi and Magunga, all of them in Korogwe district.
The company has three subsidiary firms – Tanzania Cordage (TANCORD) at Ngomeni, Muheza district, Central workshop at Ngombezi and Hale-based Mkonge Energy Systems (MES) in Korogwe district.
All the five estates are rented to small-scale farmers under SISO System.
Under this arrangement, small-scale farmers, according to a contractual arrangement, are allocated farming plots ranging from 6 to 20 hectares where they grow sisal and sell sisal leaves to Katani Limited who are buyers of their products.
Considering the importance of sisal in the country’s development, the Tanzania Sisal Board (TSB) recently came up with a sisal crop development plan – a road map of the sisal industry – in order to revamp the crop.
Aimed at promoting small holder farming – a type of activity now cherished world wide to alleviate rural poverty and raise sustainability of sisal production, TSB has, in a bid to revolutionize sisal farming by smallholder farmers, introduced mobile decorticating.
The use of mobile decorticators is common in Brazil, the world’s largest sisal producer. In effect, Brazil depends on small-scale farming to maintain the global title in the sisal industry.
In this regard, the government, through TSB had approached the Tanzania Automotive Technology Centre (TATC) – a mechanization unit under the Ministry of Defence and National Service to provide decorticators for Tanzanian farmers.
Accordingly, the first unit – a machine weighing over 600 kgs, is presently on a ten-day trial operation at the Mlingano Agricultural Research Institute (ARI) , an autonomous institution owned by Tanzania Sisal Board, the only one in the world.
“This machine is one of many we intend to order from Nyumbu (TATC) in a bid to revolutionise sisal farming in the country,” said Hassan Kibarua, TSB Senior Planning and Research Officer at the trial operations site at ARI last week.
Kibarua said introduction of the mobile decorticators was primarily aimed at liberating small holder farmers from hardship they had been facing in having their products processed in factories owned by large scale farmers.
For example, he said, private decorticators buy sisal leaves from small scale farmers for a price ranging between 5,000/= and 10,000/-.
“The famers accept whatever price on offer from owners of private decorticators be cause they are in desperate need of money, not because the price is favourable to them”, asserted Kibarua.
He said, ideally, the price should be higher considering the local market price of sisal fibre, which presently stands at 1.8 m/- for under grade (ug) fibre - a quality of produce which accounts for 70 percent in the country.
Sisal farming is rapidly on the rise in the country – a situation brought about by the awareness of farmers who have lately been shifting from traditional crops like maize and others which have, all along, been drying up shortly after planting.
Due to the rapid expansion of sisal farming, farmers have, at times, found themselves having no place to send their crops for processing, due to the fact that decorating facilities in the country are few .
Faced by such situation, farmers crops dry up, especially for those who can not afford to pay for transport costs to processing factories which may be kilometers away from their farming plots.
For those who can afford transport, they ultimately find that the profit margin is meagre ,given the prevailing prices on offer by large scale farmers.
Already, the National Microfinance Bank (NMB) has accepted a request by TSB to provide loans to small-scale farmers – either in groups or individually -to enable them purchase decorticators.
Under a tripartite agreement involving the bank, farmer and buyer of the product, a farmer is required to go to a district council where he belongs, to have his farm registered. After the initial process, TSB informs the bank, requesting the banking facility to consider the farmer’s application for a loan.
Accordingly, the contract is entered into with the farmer confirming that he would sell his product to the buyer of his choice. The buyer, on his part, should then agree to buy the product from the farmer, remitting installments of the loan given to the farmer to the bank.
After the contract agreement is signed, the bank releases the fund to the decorticator manufacturer (Nyumbu) who ultimately delivers the machine to the farmer.