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Food and nutritional insecurity are of significant concern in
developing countries, especially across sub-Saharan Africa (SSA),
where around 57% of the population cannot afford a healthy
diet.
Food insecurity is aggravated by micronutrient deficiencies,
also known as 'hidden hunger," which constitutes a severe
impediment to social and economic development and achieving the
United Nations Sustainable Development Goals (SDGs) by 2030.
Critically, the consumption of fruits and vegetables in SSA is
far below the recommended amount of 400 g/capita/day.
Promoting better access to more nutritious foods across SSA will
be crucial to ending hunger and malnutrition, as was discussed at
the Climate Change summit last November in Scotland.
Key markets comparison
The seed sectors in Northern and Southern Africa are
considerably further advanced than is the case in SSA. The
Mediterranean vegetable seed sectors (Morocco, Tunisia, Egypt) are
closely linked to the EU markets they serve and receive hands-on
assistance in establishing and developing their operational
guidelines and business undertakings.
In contrast, the vegetable seed sector SSA has been slow to
develop and has until now received little attention in the
development agenda.
Sub-Saharan Africa is not on track to meet its development
target of ending all forms of hunger and malnutrition by 2030. In
fact, hunger in SSA is increasing across all regions, and almost
20% of the continent's population is undernourished, the highest in
the world.
It is evident that seed systems have an important role to play
in the region because agricultural productivity remains extremely
low, and the use of improved varieties is highly limited. So
African farmers are deprived of the benefits of modern plant
breeding, both to them directly as producers, and ultimately to the
consumers they serve.
The early 1990s saw a dramatic change in economic policy in SSA
as it was argued that markets and private companies were more
efficient in all areas of economic activity, including seed
production. Seed laws and regulations were liberalized as public
seed enterprises were privatized in many countries and in this more
favourable climate, private companies started to enter the seed
business.
In marked contrast to the situation in Asia, seed sector reform
in Africa has not yet led to an expansion of hybrid seed production
with the notable exception of hybrid maize. For example, it is
estimated that 70% of the vegetable seed market in India is
occupied by hybrids.
In SSA, the certified vegetable seed segment is dominated by
OPVs and accounts for less than 11% of vegetable seeded area and an
estimated 55% of estimated value in 2020, although there is a
generalized lack of information on the areas of vegetable
production at the national level as well as an absence of valid
statistics on vegetable seed demand or sales.
Most of the new private companies in Africa have built a
business around trading and distributing seed but few have invested
in R&D to develop their own locally adapted varieties. There is
still little breeding of vegetables or other crops for the domestic
market in SSA, despite the entry of several multinational seed
companies. Most of the vegetable seed is still imported from
outside the continent, while local companies continue to produce
seed of open-pollinated, rather than hybrid varieties.
Lack of R&D capital
One of the major shortcomings of the African vegetable seed
sector is the paucity of R&D investment. With only a handful of
seed companies doing vegetable research in Africa, it is estimated
that only about USD 5 million is spent on vegetable R&D by the
private sector in SSA. This would be 0.5% of global investments,
while the sub-continent accounts for 14% of world population.
Some countries such as Tanzania, Kenya and Uganda mandate that
all seed produced domestically is certified by a seed certification
agency. This can significantly increase the cost of domestically
produced vegetable seed and create an incentive to import seed. Few
countries have the capacity to provide an efficient certification
service for vegetable seed so it may be better to rely on minimum
seed quality standards and not to require seed certification.
Counterfeit seed is also a severe problem in SSA countries. It
appears that regulatory agencies and law enforcement authorities in
these countries give low priority to counterfeiting in vegetable
seed as these are not considered strategic crops. Various sources
indicate that fake vegetable seed represents 20-25% of seed
sown.
And, without proper mechanisms to address this threat, seed
companies will be reluctant to invest and prefer to do business in
countries where they are better able to protect their brands.
The future looks bright
The certified vegetable market stood at $129.4 million in 2020,
of which 64% refers to Eastern-Southern Africa. (IHS Markit
Crop Science data).
Onions, tomatoes, okra, green beans, peppers (sweet and hot)
comprised 70% of certified market value in 2020.
The certified seed potato market in select SSA was set at $42.7
million in 2020. Therefore, both certified vegetable and potato
seed markets reached an estimated $172 m in 2020.
Both markets are expected to continue to grow in the 2020 to
2030 period reaching $205 million (vegetables) and $62 million for
potatoes, or a total of $267 million.
In conclusion, the forecast for certified seed penetration of
select SSA vegetable market by 2030 on 1.17m ha of land; valued at
an estimated $205m.
If you are interested in more details of our reports on
Africa, please contact Crop Science
special reports publisher Dr Alan Bullion at alan.bullion@ihsmarkit.com
Posted 19 January 2022 by Alan Bullion, Director of Special Reports & Projects, Agribusiness, S&P Global Commodity Insights