Farmers have welcomed the government plan to buy farmers’ produce as a way of coping with giveaway prices.

The Ministry of Agriculture and Animal Resources said that the new institution dubbed "Rwanda Food Commodity Board” will be purchasing produce from farmers and also help them afford agro-inputs as well as technology to modernize and transform farming systems.

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"In 2024 season A, some farmers sold maize at between Rwf220 and Rwf250 yet the government had proposed Rwf400. This is a giveaway price. If the agency buys farmers’ produce, we will be able to even get guarantees for bank loans,” Evariste Tugirinshuti, the president of Rwanda Maize Farmer Cooperatives Federation said.

He added that the agency should connect farmers to banks to provide loans at low interest rates.

"The low interest rates will help farmers afford agro-inputs. The agency should also help farmers get agriculture mechanization equipment,” he said.

Currently rice farmers have their harvest in stores due to a lack of a market.

If the Rwanda Food Commodity Board is created it could be a sigh of relief for farmers.

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About 5,000 tonnes of paddy rice out of 7,000 tonnes harvested from Bugarama arable wetland in Rusizi District is still in stores waiting for buyers.

Emmanuel Byishimo, a farmer from Rusizi District has 4.9 tonnes of paddy rice which he has not yet sold.

"This means post-harvest losses because we have no money to afford the cost for the next farming season,” he said.

Patrick Karangwa, the Director General of Agriculture Modernization in the Ministry of Agriculture and Animal Resources, said the design for the Rwanda Food Commodity Board will operate as a ‘state-owned company’.

"It is the state-owned company that we are considering so far. It would be linking to other services including technologies, agro-inputs but also access to finance. So far the financing of agriculture is around 6 % of all the loans that people take from banks,” he explained.

The design, he said, has been completed, and it awaits approval by competent authority.

"Consultations are still going on and are considering inputs for that. It is expected to be an enabler of transformation and modernization under PSTA 5 as we ambition,” he said.

The fifth Strategic Plan for Agriculture Transformation (PSTA 5) runs from the fiscal year2025 to 2029.

According to Karangwa, having such an agency that will buy produce from the farmers for strategic food commodities such as cereals and pulses will attract banks to give loans to farmers.

"Since the farmer will be selling to such an agency, they do not struggle with meeting the upfront cost. There will be tripartite framework agreement between the agency, the farmer and service providers with any particular product for agriculture innovation.

It will be deducting the payment upon harvest for qualifying farmers,” he said.

Rwanda Food Commodity Board, if approved, will be the 3rd agency under the agriculture ministry after Rwanda Agriculture and Animal Resources Development Board (RAB) and National Agricultural Export Development Board (NAEB).

Karangwa said that the new agency will also serve as food storage for food security at all times and food balance sheets for the country.