Saturday, March 03, 2012

Mozambique's Soybean Potential

As some of you know, I'll be traveling to Mozambique over the summer to work on a new UN initiative named REACH - Renew Efforts Against Child Hunger. The overall goal of REACH is to facilitate better governance and management of nutrition programs and ensure that UN agencies (FAO, WFP, UNICEF, and WHO) are coordinating their nutrition interventions.

With more than 40% of children under five stunted, Mozambique's government has prioritized the fight against chronic malnutrition. However, the integrated nature of nutrition programming makes it difficult to  operationalize, specially in Mozambique where there are so many development agencies and initiatives working at the same time.

Agricultural projects that can have a positive impact in reducing stunting are gaining traction in the development discourse.  Mozambique has an incredible potential to increase its food production and use agricultural development as an powerful engine for economic growth. The country has plenty of unused arable land, growing urban markets inside and abroad, cheap labor, and a great geographic location, with deep-water ports and infrastructure projects needing relatively little investments.

Can soybean lead the way in agricultural development? As the video below shows, the Northern part of the country has soils similar to those in the Cerrado - the Brazilian soy basket. According to the video, the Mozambique government recently signed an agreement with Brazilian soy farmers, allowing them to farm these lands in exchange for increased labor demand and technological advice on soy farming.

The initiative is also been supported by EMBRAPA, Brazil's agricultural research agency along with JICA and USAID. They are all working with government officials to adapt seed varieties to the Northern region and identify the steps need to develop soy's the value chain.

Similar, a World Bank study recently noted the following:
Soybean is a fairly new crop in Mozambique, but agricultural and market scenarios suggest a high potential in the northern Zambezia/southern Niassa area of northern Mozambique, and in Manica and Tete provinces in central Mozambique. In both production areas, improved soybean production can strongly benefit from a local good demand of soybean sub-products and investments in new industrial units, and from  already existing roads and railways linking to the important consumer markets of Beira  in the center and Nampula and Nacala in the north
More recently, Rei do Agro, a local agricultural firm, announced the plantation of 500 hectares of soybeans in the Zambézia province. This follows similar private sector initiatives that are taking advantage of the increasing world demand for soybeans to invest in Mozambique's crop potential.

At first look this makes sense. Soybean are one of the country's top 5 imports in terms of volume and value. With an increasing trade deficit, it makes sense to promote the crop as an import substitute and, in the future, as an export to satisfy growing world demand for the commodity.

Another good reason to promote soy is that the soil type in the north renders it unsuitable for other cash crops. Like the Cerrados in the 70's, these soils are consider wasteland.

In terms of nutrition, the high caloric and protein content of soybeans is also attractive given the country's high incidence of stunting. In theory, soybeans could play an important role in meeting the caloric requirements of Mozambicans while generating cash to access other products.

However, little evidence exist about the positive linkages between agricultural growth and reduction in chronic malnutrition. Although it may seem intuitive to think that higher food availability and/or increase incomes will improve diets, the link between those hasn't quite been demonstrated by robust studies. Moreover, most soybean production is used for livestock feed and the processing for human consumption requires a more complex value chain that the country currently lacks.

So the question remains: Would soybean serve as an engine of economic growth, providing much needed cash, calories, and employment for thousands of Mozambicans or would the project be added to the long list of failed mono-culture promotion initiatives in the past few decades? For now the jury is still out. Stay tuned.