Rwanda is facing a soybean shortage amid growing demand for the crop, which is used as a raw material for fortified food.

While local production has increased over the years, supply remains below demand, prompting food dealers to depend on imports from the region. However, there is also a scarcity of the crop in the region partly due to trade disruption over escalating tensions between Uganda and Rwanda.

Plantation

A tonne of soybean is sold for Rwf600,764, while a tonne of maize goes for Rwf291,279, and according to the East Africa Exchange, 1Kg of soybean costs Rwf540. The East Africa Exchange (EAX) is a regional commodity exchange established to link smallholder farmers to agricultural and financial markets. For instance, in the last three months of 2018, soybean prices shot up by 25 per cent, increasing to $650 per tonne from $520, mainly driven by limited supply according to market sources.

The scarcity of soybean in the region is affecting manufacturers who use it as a raw material, with officials at the Africa Improved Foods saying the company has settled for a reduction in its profits, as they plan to venture into millet-based porridges.

However, the EAX said they have settled on importing soya from outside the country, since soya production in Rwanda is dwindling.

“Soya production is decreasing in the country so we get it from countries like Malawi,” said Diane Mutuyimana from the EAX.

In 2012, Rwanda was the sixth country in Africa with the largest soya plantation at 42,160ha, after Zimbabwe, Malawi, Uganda, South Africa and Nigeria, but this has changed over the years, where most of the soya processed in the country is currently sourced outside.

Mount Meru Soyco Ltd, a cooking oil processor in Kayonza, has been struggling to get soya beans for the plant for years, and has had to sometimes switch off its machines.

Although there has been talk of the government giving farmers’ co-operatives access to a long-term loan facility worth Rwf6 billion to increase soya productivity, this has not yielded any tangible results.

About 9,000 farmers involved in soya production form 200 co-operatives, but their yields seem to be decreasing, yet demand is growing.

Data from the Rwanda Agricultural Board shows that some soya farmers were frustrated due to delayed payment from soybean buyers, hence many opted to grow other crops.

Unfavourable weather conditions experienced in the past few years in Rwanda have affected soya production, especially in the Eastern Province.

Growing soya needs largescale irrigation and mechanisation technologies to counter the dry spells, as dependency on rain has proven not conducive for soya production.

Local farmers’ co-operatives can only manage to supply up to 500 tonnes of soya to Africa Improved Foods, which is not enough.

However, escalating tensions between Rwanda and Uganda have also affected soybean supplies from Uganda, with Africa Improved Foods settling for its other sources like DR Congo, Malawi and Tanzania.

The firm plans to go beyond its flagship products of Nootri-toto and Nootrimama porridge formulae, and diversify its product portfolio by including millet-based porridges.

The $61 million plant, which produces highly nutritious foods for local consumption and export, requires 28,000MT of maize and 12,000MT of soybean annually to operate at full capacity.

“Soya has become more expensive which has reduced our profitability, so we have just settled for lower margins” said AIF country manager Prosper Ndayiragije, adding that the price per tonne has increased by up to $100.

Market analysts have partly attributed the hike in regional soybean prices to the trade war between the US and China, as Beijing chose East Africa as one of its alternative soybean sources, after it imposed 25 per cent duty on soybean imports from the US last year.

The move was in retaliation to America’s imposition of punitive tariffs of $34 billion on Chinese goods.