With a thoughtful approach to agricultural sourcing, the private sector is uniquely positioned to influence an appropriate and sustainable balance between smallholder and commercial farmers
SABMiller’s success is inextricably linked to that of the communities in which we operate. So sourcing locally has always been a core part of our business model, and it is becoming even more important. We work to build local value chains that secure long-term supply, mitigate commodity price volatility, and reduce transport costs – all sound commercial reasons. But there is a bigger picture. Our work is driving local economic growth and stimulating social development, delivering a win for local communities as well as for our business.
Nowhere is this more evident than in Africa. We may now be a leading global brewer but our roots remain firmly in Africa where we began making beer over 100 years ago. The African farmers who produce the crops we use to brew beer are the bedrock of our business – today, we directly support around 100,000 farmers across the continent.
Like other companies, we have realised in recent years that we have to step up our efforts to equip farmers with the knowledge, skills and support they need to play their full role in building the continent’s prosperity. This is particularly the case with Africa’s smallholder farmers who, despite being crucial to food production and rural life, have been bypassed by those agricultural technologies which have helped other farmers around the world boost yields.
By guaranteeing markets and fair prices for crops, and helping to improve quality and yields, we are able to buy increasing volumes directly from smallholder farmers. We have led the way in developing beers brewed from new crops. We were the first international brewer to use sorghum when we launched Eagle Lager in Uganda in 2002, which sources from local smallholder farmers. Today, around 8,000 farmers in Uganda earn close to 70% of their income by growing sorghum for us.
And last year in Mozambique we launched ‘Impala’, the world’s first commercial-scale beer brewed using cassava. Our innovative mobile units allow us to process cassava in the fields, thereby avoiding the crop’s rapid post-harvest deterioration which is one of the greatest obstacles to its commercialisation. This is important for the quality of our beer but it also allows more remote rural areas to benefit from this new market for their crop.
One year on, more than 500 farming families in Nampula province are shifting away from subsistence farming to market-oriented, income-generating farming. They have boosted both yields and incomes, producing 2,700 tons of cassava for us to date.
We don’t believe that there’s a necessary conflict between what’s good for development and good for business. Nor do we see supporting agriculture, as some have in the past, as a retreat towards pre-industrial times. It’s about building a modern and successful agricultural sector which can meet the continent’s own food needs, improve health, drive prosperity, strengthen communities – and, in turn, can help feed the hungry around the world.
Enhancing smallholder productivity, and helping subsistence farmers become small-scale commercial operators is one part of this equation. The other lies in driving the sustainability and resource-efficiency of commercial farmers. In Zambia we have worked with local brokers and commercial farmers to develop a local barley industry. As a result, over 4,000 rural workers now have a regular income for themselves and their families and our Zambian business is able to source the majority of its barley locally.
With a thoughtful approach to agricultural sourcing, the private sector is uniquely positioned to influence an appropriate and sustainable balance between smallholder and commercial farmers, helping to enhance livelihoods, incomes and, ultimately, food security.
Andy Wales is Senior Vice President, Sustainable Development, for SABMiller