Agriculture

Agriculture

Sector Overview

Sierra Leone remains predominantly an agricultural economy, in spite of the high profile the mineral sector receives. In 2011, agriculture contributed about 51 percent to GDP, 17 percent of exports and employed 61 percent of the work force. Sierra Leone has strong underlying agricultural potential which, in the past, enabled the export of significant quantities of agricultural commodities such as coffee, cocoa and oil palm. Over the past decade, agriculture has demonstrated its underlying potential growing at an annual average of 4 percent. Growth in this sector was due to steady increases in domestic production of major crops and livestock.

The country covers 72,300 km² or 7.23 million ha of which 5.4 million ha are potentially cultivable. 74 percent of the total area of the country is considered arable land, but only less than 15 percent is currently cropped in any year. There are five ecosystems where farming is practiced in the country. These are Upland, inland Valley Swamp, Mangrove Swamp, Bolilands and Riverine Grassland. These upland agro-ecology represents approximately 80 percent; and the rest are lowlands with potential for high crop yield under sound management practices. The lowlands comprise 690,000 ha inland swamps, 145,000 ha of natural grass drainage depressions (bolilands), 130,000 of riverine grassland and 20,000 ha of mangrove swamps. The land tenure system in Sierra Leone is of communal/customary ownership and authority for allocation is vested with the traditional local authorities.

Sierra Leone´s climate provides two distinct seasons: a dry season from December to March and a wet season from April to November. Rainfall is abundant, ranging from over 4,000 mm in the West to about 2,000 mm in the North given an annual average of about 3,000 mm for the country. Average mean monthly temperatures rage from 23 to 29 °C. The country has nine major and three minor perennial rivers that can be used for irrigation during the dry season, but are currently not utilised. With a coastal line of about 340 km, the country has important fisheries resources.

Crop production is the main sub-sector as it contributes about three-quarters of agricultural value added, with rice holding the dominant position. Agriculture also accounts for over 90 percent of the domestic energy for heating and cooking through the supply of fuel wood.

  • Sierra Leone is potential to develop an advanced agriculture sector in the future. The geography, natural conditions, human resources in Sierra Leone are suitable for large scale agricultural production.
  • The sector is dominated by smallholder farmers, in subsistence farming, using traditional methods and limited use of farming inputs
  • Yields are generally, even by African standards, with current levels for rice ranging between 1.5 MT and 1.9 MT per hectare
  • There are fairly large agricultural estates, both government and privately owned, particularly in the Eastern and Southern parts of the country, which grow coffee, cocoa, kola-nuts, rubber and oil palm.

Growth Potentials

  • The current performance of agriculture represents a fraction of the underlying potential of the country.
  • The use of more intensive methods in the farming of existing cropped areas, together with increasing cultivable land, could accelerate agricultural growth from current levels.
  • The improvements in infrastructure planned by Government are expected open up substantial new areas for profitable agricultural use.
  • The sector is also attracting investments in new farm estates; the evidence also shows that, with even modest investments in rehabilitating existing farm estates and the introduction of more intensive farming, it is possible to earn attractive returns on agriculture.

Agriculture

Unique Selling Points of Sierra Leone’s Agriculture Sector

1, Significant Arable Lands

Sierra Leone has significant amounts of arable land, most of which remains uncultivated, with up to 4 Million hectares of arable land still available for cultivation. Even though the dominant form is customary tenure under communal ownership, the country is now very advanced in developing and harmonising procedures for private acquisition lands, through long-term leases, for agribusiness investments.

Where necessary, and depending on the merits of a particular agribusiness project, the Government of Sierra Leone is prepared to take a head lease on provincial lands and sub-lease to foreign investors in order to mitigate risks.

2. Favourable Supporting Ecology

Sierra Leone has a diverse ecology, which altogether provides ideal conditions for the cultivation of a wide range of crops.  The coastal plains of the Atlantic stretch approximately 200 miles; relatively flat surfaces that are frequently flooded in a range of between 5 and 25 miles off the coast; suitable for the cultivation of rice, ginger, vegetables and cassava. The interior plains comprise seasonal floodplains (or ‘Bolilands’); rolling wooded areas; and a variety of savannah covered low plains and hills; suitable for the cultivation of rice, sugar, oil palm, cassava and cashew. The interior plateaus, mountains and inland valley swamps of the east are suitable for the cultivation of rice, cocoa, coffee and oil palm. The Western Area, which consist of thickly wooded mountains running parallel to the sea for about 25 miles, are suitable for mangoes, citrus fruits and livestock

3. Favourable Climate

The country has a tropical climate with principally two seasons; the dry season, which lasts from October to March, and the rainy season lasts from May to October; July and August are the wettest months. Rainfall levels range between 1,500mm in the interior areas of the country and 5,100 mm in the coastal areas.  Sierra Leone’s rainfall is classified into 3 climatic belts; the first belt spans from the Coast up to 80Km inland; the second belt spans between 80Km to 190Km inland; and the third belt ranges between 190Km inland to the border areas.

4. Adaptable Topography

The country’s topography, high rainfall levels and numerous ground water sources offer huge potentials for irrigation all around the country. The country has a dense drainage pattern, with 9 major rivers, coastal creeks and tidal streams. Together, these conditions make it relatively easy to irrigate up to land for the cultivation of crops such as rice, which can have up to 3 cycles in a single calendar year. There are up to 300,000 Hectares of land that have been identified as priority targets for irrigation in the next 5 years

5. Cheap Labour

Sierra Leone has among the lowest wage levels in the region; the agriculture sector falls among those attracting the least in the country’s wage structure. This offers huge comparative advantage particularly for large scale agriculture projects.

Government Policy and Strategy

The main focus of the National Sustainable Agriculture Development Plan, especially the Smallholder Commercialisation Project component, is the commercialization of the sector, increasing food production to create food self-sufficiency and enable exports. The medium term strategy for the country’s agriculture sector development focuses on the following key areas:

  • Improved Land and Water Management: Developing irrigation infrastructure covering at least 300,000 Hectares of land for improved cultivation
  • Improvement of Roads and Other Infrastructure: Constructing feeder roads to increase links between production centres and markets and processing infrastructure for prominent products within localities
  • Improved Access to Rural Finance: Enhancing effectiveness of rural financial services institutions at local level to directly support farmers’ access to financial services.
  • Diversification into Livestock Production: Improving the productive livestock industry, to increase the production levels of cattle, sheep, goats, pigs and poultry
  • Sustainability: Introduce and ensure the use of more sustainable agricultural practices and methods for the conservation of soil, water, forest and biodiversity resources
  • Promoting Large Scale Private Investments: Provide incentives for large private investors operating alongside and supporting smallholder farmers in out-grower schemes and training

 Incentives

In addition to the general incentives offered by Government to support investments in the country, the following sector-specific incentives apply:

  • To a foreign investor irrigating at least 500 hectares or cultivating least 2,500 hectares of land or investing at least US$1 million in livestock and livestock products; or
  • To a domestic investor irrigating at least 100 hectares or cultivating least 500 hectares of land or investing at least US$ 0.5 million in livestock and livestock products.
  • Complete exemption from corporate income tax up to 2020; plus, 50% exemption from withholding taxes on dividends paid by agribusiness companies
  • Complete exemption from import duty on farm machinery, agro-processing equipment, agro-chemicals and other key inputs; 3 year exemption from import duty on any other plant and equipment; reduced rate of 3% import duty on any other raw materials
  • 100% loss carry forward can be used in any year
  • 125% tax deduction for expenses on R&D, training and export promotion
  • 3 year income tax exemption for skilled expatriate staff, where bilateral treaties permit
  • Sites already identified for new investors

Investment Opportunities

A growing population and recovery of incomes in Sierra Leone is causing a rapid increase in the domestic demand for food crops. Demand for food is also increasing in neighbouring countries and Sierra Leone should have preferential access to ECOWAS markets. The country already has a very small presence in key international export markets such as coffee, cocoa, kola nut and oil palm which could be increased substantially. The opportunities in the main crops are described below.

Rice

Rice is the major crop accounting for 75% of agricultural GDP. Per capita consumption of rice amongst the highest in sub-Saharan African, so current production represents only 60% of total domestic demand (550,000 tonnes). Yields
vary between 1.3 tons/ha and 2.5 tons/ha with improved inputs. Local rice fetches a 15% to 20% premium over comparable grades of imported rice. These are opportunities to invest in domestic rice production and in the marketing and processing of domestic riche production by smallholders. The World Bank and FAO have confirmed that Sierra Leone has a comparative advantage in supplying its domestic market.

Oil Palm

Oil palm has been an important cash and export crop that can be produced in many parts of the country. Production has rebounded to around 195,000 MT despite the fact that Government plantations are badly neglected, comprising mainly of aged, low yielding trees.  Current yields are about 1.5MT of Crude Palm Oil per Hectare and exports remain modest compared with periods over 2 decades ago; about 1,500MT of crude palm oil was exported in 2003. There are opportunities to invest in oil palm as the government is promoting the rehabilitation and expansion of its oil palm estates throughout the country with private sector participation.

Cocoa and Coffee

coffeeCocoa and Coffee have the potential to become major cash and export crops as they were during the 70s and 80s. Most production is under smallholder farming on plots of 1 to 6 ha. Average yields are 410 kg per ha for cocoa, 390 kg/ha for coffee beans, very low even by African standards. There are opportunities to invest in the rehabilitation of existing plantation or establishing new plantations. With the use of improved technologies that are already available in the country, recent FAO projections shows that Sierra Leone should have comparative advantage and compete successfully on international markets. There are opportunities also to participate in the export of these commodities.

Groundnut, Cassava, and Pepper

Cassava has become the second food crop in terms of importance and area cultivated has increased five-fold. As the diet of many Sierra Leoneans become even more diversified to include cassava based foods such as gari and fufu; and with opportunities for industrial production of starch and cassava flour, the cultivation of cassava offers tremendous opportunities. There are favourable opportunities in the cultivation and processing of all these crops both for local consumption as well as for export and all three crops have the potential to generate higher net profits compared with rice.

There are a number of local farmers and farmer groups looking for strategic partnerships to expand their farms as well as to enter into bulk off-taker agreements as a means of minimising post harvest wastage of these perishable crops.

Fruit and Vegetablesfruit&veg

Fruit and Vegetable growing is regaining importance.. However, these levels are far below levels of demand. There is
scope to facilitate the regeneration of the nucleus-estate activity that existed before the war, stimulating also growing by smallholders and in developing the marketing infrastructure for these high value crops. Also over the past few years, there have been notable fruit juice factory investments in the country, whose operating input demand levels are significantly higher than current production levels of these fruits.

Livestock

livestockLivestock contributes 6% of agriculture GDP. Animals are kept mainly in the North. Poultry is the most widely owned form of livestock. Overall, livestock birth rates are low (45%), mortality is high and off take is only 7%. Cattle numbers in 2011 were estimated to be about 178,000 heads; sheep about 95,000 heads; goats 65,000, and 900,000 poultry. Total domestic production is not sufficient to meet the needs of the growing population which is gradually rec overing purchasing power and so consuming more meat. There is scope to invest in animal rearing, slaughter facilities and developing a more efficient marketing chain.

Other investment opportunities include;

cotton, rubber, ground nut planting, processing industries for fruit juice, meat processing factory, rice processing factory, fish processing and poultry etc.

Agricultural Inputs

The supply of fertilizer, improved seeds, agrochemicals, animal feeds and veterinary inputs is well below potential demand. The import and distribution of these inputs provides an opportunity for a variety of small and large investors.