July 3, 2014

Pulling in the Private Sector to Improve Food Security

ASI Launces New Project to Incentivize Innovation in Storage Solutions for Farmers

Agribusiness Systems International (ASI) is proud to announce the launch of the AgResults Kenya On-Farm Storage Pilot in Kenya. The project is part of the larger AgResults Initiative, which is a $110 million multilateral initiative rewarding high-impact agricultural innovations that benefit smallholder farmers and promote global food security, health, and nutrition.

The initiative goes beyond traditional aid measures to promote the uptake of innovative technologies with high-yield development impacts by offering results-based economic incentives. The objectives of AgResults are: 1) to overcome market failures impeding agricultural innovations by offering “pull�? financing to competing private actors who increase the use of new agricultural technologies by smallholder farmers; and 2) to test the effectiveness and efficiency of "pull" financing in comparison with traditional approaches to the promotion and uptake of innovative agricultural technologies.

Post-harvest losses of grain are extensive and are a major threat to food security. This problem is particularly acute in sub-Saharan Africa where on-farm storage solutions are not widely available nor well adapted to local needs, resulting in inadequate protection against insects and pests. Post-harvest losses in sub-Saharan Africa are estimated at 13.5 percent of the total value of grain production, or $1.6 billion per year. Improved smallholder access to effective storage solutions could therefore lead to a meaningful economic benefit.

The Kenya On-Farm Storage Pilot aims to promote food security by stimulating widespread adoption of improved on-farm grain storage systems that reduce smallholder post-harvest crop losses. The pilot will be administered through performance-based grants to small-scale maize storage solution vendors (implementers) in the Rift Valley and Eastern regions of Kenya who find innovative solutions to increase storage capacity among smallholders. A total of $7.75 million in grants will be available to participating storage providers in the following two categories.

• In the Rift Valley counties of Uasin Gishu, Baringo, Nandi, Trans Nzoia, Nakuru, Kericho, Bomet, Laikipia, and Trans Mara, a performance-based grant of $750,000 will be offered to participating storage providers who meet pre-specified milestones for storage sales to smallholders, as well as a proportional performance-based grant of $1 million to participants for their contributions to overall storage capacity sold over the four-year pilot timeframe.
  
  
• In the Eastern counties of Machakos, Makueni, and Kitui, a performance-based grant of $3 million will be allocated proportionally to implementers for their respective contributions to sales of larger grain borer-resistant storage solutions.

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