6.2 Extension, Practice, Productivity and Profitability of Organic Agriculture in Zanzibar ______90
6.2.4 Practice, Productivity and Profitability of Certified Organic Agriculture
As established above, the high cost of certification is a major constraint to the expansion of certified organic farming in Zanzibar. With the establishment of the local Tanzanian certifier TanCert, the expense is somewhat reduced. The decreased price compared to international certifiers is mainly related to the reduction in travel costs. In addition to this cost, and a fixed fee of 400-500 EURO, expenditure is determined by size of land, the number of farmers and the number of days in the field. For TAZOP, who is certified by IMO, the small plots farmers have in Zanzibar cause several related problems. TAZOP needs at least two tonnes per consignment for export. Because of the small plots, sometimes the farmers cannot fulfil the demand. Therefore, TAZOP has to drop farmers if they cannot produce enough. TAZOP cannot just add more and more farmers to their supply list to ensure the quantity, because of the expensive control system. The more farmers, the higher the costs. In this way, smallholder farmers in Zanzibar are disadvantaged compared to the TAZOP farmers with large plots in Tanga, Kigoma and Morogoro on the Tanzanian mainland.
The two TAZOP farmers interviewed both mentioned that the price they receive is low and
99 that it is subject to fluctuations. Indeed, according to the managing director of TAZOP, Khamis Issa Mohammed, there are two reasons for why the price for organic products has gone down in the last few years. Firstly, Mohammed explained that when TAZOP started in 1992, the premium price was a hundred percent, while now it only covers the certification.
According to Jordan Gama, executive secretary at TOAM, the reason for the decline in premium is because of an increase in supply of organic produce. Still, Mohammed believed organic had an advantage, because if organic spices and industrially produced spices cost the same, people will choose organic. Secondly, due to the global financial crisis, TAZOP’s German importer collapsed and the prices for organic products went down. This led TAZOP in 2008 to establish a new importer and distributor based in Switzerland called Zanzibar Spice AG, which became certified and fully operational in 2010. Therefore, according to Mohammed, farmers do not get a better price for growing organically, and sometimes they will sell a small amount of their total produce at the market if the price there is higher. The farmers can do this because, like explained in chapter 6.2.3, they do not have a binding contract with TAZOP on the amount they need to supply. The price is also determined by several other aspects. If TAZOP has an annual contract with an importer, then the price the farmer receives is fixed whether or not the price goes up or down. However, according to Mohammed, in the rare circumstances that TAZOP has purchased the produce before they get an offer from an importer, the company will always go back to the farmers and discuss the price. The company pays the farmers in cash, but sometimes they have to wait to receive their money until TAZOP has sold the produce, “this is one of the negative sides of the company” Mohammed said. Finally, middlemen also determine the price. TAZOP always pays more than the middlemen, as Mohammed said, TAZOP minimises their own profit rather than for the farmers. This is confirmed by Saidi Ali Juma, a clove farmer for TAZOP, who said that after he sells his cloves to ZSTC, he gets a top up from TAZOP. TAZOPs dedication to their farmers is confirmed by Haji Saleh at MALE and OFA, in saying that Mohammed is “very genuine, he helps the farmers”.
According to Leonard Mtama, the manager at TanCert, there is little knowledge of TanCert amongst farmers. The only farmers that know are the few organic farmers that are producing organic in high quantity, and those that are connected to an organic farming business.
Mtama said that many would like to produce organic crops on the mainland as the premium
100 is ten to twenty percent on the prevailing market value. However, according to Mtama,
“many farmers believe what they are producing is naturally organic so why put extra cost on it”. Further, “people might understand there is an extra value but not much is produced and it is expensive”. Also, farmers are put off by the magnitude of requirements, which has lead TanCert to not post the requirements on their web-page, as potential clients will step back and say that they cannot comply with it. Even though certification is fairly new in Tanzania, according to Mtama, many people enquire about it.
TanCert operates with two standards, one for the local and regional market, called the East African standard (EAS), and one for the international market, the export standard. TanCert is however working to get the EAS accepted in the European Union, and Mtama is certain that they will succeed. But the road ahead is long, because as Mtama said, it is difficult for TanCert to gain the credibility necessary for consumers in Europe to trust the company. Even after TanCert was established, importers still choose to use more expensive, but well-known certifiers like IMO when importing from Tanzania. However, IMO is collaborating with TanCert, and use their certifying inspectors.
To sum up, there seems to be a slight economic gain for Zanzibari farmers to be certified through an organic farming business. Mohamed Saleh Ali, a TAZOP citrus farmer, said that after he got certified, he acquired a lorry and a fish pond, which he said he could not have done without being certified. Also, Ali said that one bag of 200 lemons that he sells to TAZOP for 1000 TZS would only fetch 500 TZS at the local market. However, according to Mtama at TanCert, if the farmers own their own certificate it is more profitable. Mohammed at TAZOP believes it has less to do with being certified organic or not and more to do with contracted farmers in general, who have a secured market. He stressed that TAZOP is always with the farmer through the processes of training, inspection and purchasing. According to Mohammed, this gives them hope and makes them invest in what they are doing, and so their welfare is improved.
101