Consultant-Contract Farming Model for White Sorghum in Zambia 302 views

Scope of Work

Structuring a Contract Farming Model for White Sorghum in Zambia

1.       Project Introduction

The Feed the Future East Africa Market Systems Activity is a 5-year, USAID-funded activity designed to promote increased agricultural production, trade, improved policies, finance and investment, and resilience to shocks and stresses in the East Africa region by addressing agricultural issues that can only be solved on a regional basis. The Activity is organized under four objectives: 1) Strengthening cross-border agricultural market systems, 2) Accessing and scaling technologies, 3) Strengthening regional resilience, and 4) Strengthening the regional agriculture policy and regulatory environment. The geographic area of focus includes the East African countries of Kenya, Tanzania, Uganda, Rwanda, Burundi, Ethiopia, Somalia, South Sudan, and Zambia.

The Feed the Future East Africa Market Systems Activity’s approach to achieving the above objectives revolves around the establishment of catalytic partnerships and alliances with private sector actors. These partnerships must be innovative, transformative, and have systemic impact on the overall market system. The modes of support vary from partnership to partnership, but in some cases includes provision of tailored technical assistance delivered directly by project staff or through a consultant or firm.

2.       Background

Companies sourcing agricultural commodities across East Africa often struggle to consistently find reliable quality and quantities due to fragmented production, ineffective aggregation systems, insufficient storage space, limited capacity of suppliers to comply with contractual and quality requirements, and suppliers’ limited access to appropriate financial services. As a result, companies face significant difficulties managing their supply chains, and have trouble implementing sustainable business practices across their supply chains or networks. These dynamics create a market failure despite the region’s high demand and high production potential. For agro-processing firms in particular, the lack of access to consistent quantities and quality of raw materials inhibits their growth – as inconsistent and inadequate supply leads to inadequate primary processing, storage, and distribution of the finished processed products, making it difficult to enter new markets due of the resultant low competitiveness and inability to meet demand of end-buyers.

Contract farming models can enable companies to have direct and deeper  relationships with suppliers and ultimately reduce risk by providing more hands-on management of their supply chains. Through the provision of crop production support to contract farmers, increased transparency and commitment to commodity pricing, and greater opportunities for planning and managing aggregation, purchasing, and transport of commodities, contract farming can reduce uncertainty for all parties, and encourage widespread investment by value chain actors.

Though contract farming models can serve as risk mitigation tools, the initial establishment of such a model can be costly and risky for firms to undertake. Legitimate concerns about side-selling, lack of trust on part of farmers, and risks associated with rain-fed agriculture, application of good agricultural practices, and pest/disease outbreaks (though they can be managed and, in many cases, overcome) can discourage firms from investing as required to ensure the model’s success. The Activity has an interest in testing and expanding the contract farming model as a solution for sustainably linking demand and supply poles across borders in East Africa. Recognizing that success breeds success, the Activity envisions that proving the concept that cross-border intraregional trade can be strengthened through direct contract farming models between anchor firms and suppliers will encourage greater investment by other value chain actors to construct and expand similar pilots.

3.       Scope

The Feed the Future East Africa Market Systems Activity seeks a qualified consultant to support the structuring of a Contract Farming Model for White Sorghum in Zambia with a purpose of testing the model with 2-3 commercial farmers and expanding the Model to onboard the out-growers at a later stage.

4.       Objectives 

The objective of this assignment is to develop, test, and plan for expanding a contract farming model for white sorghum in Zambia targeting a regional off-taker in Burundi. The model will be piloted with an initial trade arrangement of 1000MT of white sorghum.

5.        Period of Performance

The consultant/firm will design, test, and develop a plan for expansion in 6 months, with an anticipatedstart date for delivery November 2021.      

6.       Required Tasks

The specific tasks the consultant will undertake will include:

a)       Profile four (4) commercial farmers and outline their readiness for white sorghum contract farming, including production levels and methods, supply (export), and financial capacities.

b)      Profiling production potential and pricing for white sorghum offered by local off-takers in Zambia.   

c)       Identify additional services that may increase sorghum yields, producer interest and loyalty for participating in the contract farming model, and capacity to export within the region such as:

                                 i.            Financing, crop insurance, or provision of agricultural inputs.

                               ii.            Cross-border procedures, documentation, basic logistics issues, and shipment planning.

d)      Develop a supply contract framework for white sorghum to be utilized by commercial producers and the regional off-taker.

e)      Monitor progress on the contract execution and performance against expected contract deliverables.

f)        Develop recommendations on how to improve and scale the sorghum contract farming model in Zambia to reach more commercial farmers and out-growers.  

7.       Deliverables

The consultant will deliver the following deliverables for this assignment on a firm fixed price basis:

8.       Qualifications

Consultants who will meet the following Qualifications will be considered:

a)       Professional qualification in agriculture, agricultural marketing, agricultural economics, agribusiness management, or related field.

b)      Knowledge of sorghum production and the entire supply chain in Zambia.

c)       Relevant work experience in the field of contract farming and agricultural market development in Zambia.

d)      Experience working with commercial producers and smallholder farmers.

9.       How to apply

To apply, applicants must submit the following to EAMS.Procurement@thepalladiumgroup.com by 4 November 2021, 5:00 p.m. EAT:

1.       Cover letter or Statement of Work (2 pages maximum) detailing:

a.       How the applicant meets the qualifications listed above.

b.   Narrative describing 3-5 recent examples of similar work (i.e., related to managing, establishing, or supporting a contract farming model) and the successes and lessons learned of those assignments. This may be included as a table in the following format:

2.       Proposed number of days to achieve each deliverable, a daily rate, and a description of expected travel with estimated travel cost.

3.       Resume/CV (3 pages maximum).

4.       Three professional references that Palladium may contact including: Name, Position, Relationship to Applicant, Phone Number, Email Address. Palladium will only contact references for candidates who have been shortlisted.