Seed for Impact Programme - Tanzania Window

The core objective of this funding initiative is twofold.

1. To increase the availability of seeds of improved and high-yielding climate-resilient crop varieties specifically tailored to the agroecological conditions of Tanzania.
2. To provide technical assistance to the supported seed enterprises. This assistance will focus on enhancing their capacities in seed production, quality control, and distribution systems.

This programme is strategically allocating its funds to prioritise the regions of Mbeya and Songwe in Tanzania.

These regions have been selected based on their predominantly agricultural nature and their high potential as agroecological zones.

Prospective applicants are strongly encouraged to develop comprehensive proposals that effectively articulate strategies for scaling up the adoption of climate-smart crop varieties and enhancing accessibility to certified commercial seeds of superior quality.

These proposals should not only demonstrate innovation but also contribute to the advancement of Tanzania’s seed sector by focusing on improving efficiency, productivity, and fostering market growth.

It is important to note that support will only be directed towards availing seeds of food crops, with a specific emphasis on promoting climate-resilient crop varieties. Potential investees are encouraged to explore the commercialization of legumes and pulses that can be utilized in various climate-smart agriculture approaches, as well as the promotion of essential nutrient-dense crops that possess high market potential. By focusing on developing such crops, the proposals should contribute to meeting market demands and enhancing the profitability of the agricultural sector.

This funding opportunity primarily targets the scaling of crop varieties originating from the public sector. Thus, proposals should emphasise the utilisation and dissemination of publicly available varieties while ensuring their successful expansion throughout Tanzania.

 

In order to ensure the success of the presented business models, it is essential to address the following key factors:

1. Ensuring access and affordability of climate-resilient and nutritious crop seeds for smallholder farmers in rural Tanzania: The models must include strategies to enable smallholder farmers in rural Tanzania to access and afford seeds of climate-resilient and nutritious crop varieties. This can be achieved through working with sales agents that are located in rural regions as well as demonstrating other viable seed distribution pathways.
2. Demonstrating the availability and readiness of the end/output market for the climate-resilient crop varieties: To ensure the success of the models, it is crucial to demonstrate the existence of a viable market for the crop varieties being produced. This includes considering factors such as market size, location, and growth trends. Additionally, the models should showcase some level of commitment from end buyers to purchase the crop varieties, indicating their readiness to off-take the products.
3. Understanding end market requirements and developing supply chain investments: A clear understanding of the requirements of the end market is essential. This includes considering factors such as the quantity, variety, quality, and price that the market demands. The models should outline a plan for meeting these market requirements and highlight the necessary investments along the supply chain to ensure the successful delivery of the crop varieties to the end market.
4. Facilitating access to a bundled package of inputs for smallholder farmers: To maximise yield, it is important to demonstrate alternative pathways for smallholder farmers to access a bundled package of inputs. These inputs may include not only seeds but also fertilisers, pesticides, and other necessary resources. The models should outline strategies such as group purchasing, cooperative farming, or partnerships with input suppliers to provide smallholder farmers with affordable and comprehensive input packages.
5. Engaging women and youth for Programme benefits: The models must address how women and youth will be specifically engaged to benefit from the Programme. This may involve tailored training programmes, capacity-building initiatives, and targeted support to empower women and youth in agriculture.

The socio-economic impact of the business concept will be assessed using the following indicators:

1. Net number of primary beneficiary households: The total number of households benefiting from the business concept will be measured annually. This will provide insights into the reach and scale of the Programme. Additionally, the average net additional benefit per household per year and the cumulated net benefits in US dollars will be calculated to assess the overall impact on the livelihoods of beneficiary households.
2. Net additional jobs created: The number of full-time equivalent (FTE) jobs directly sustained or created in enterprises supported will be tracked. These jobs will be disaggregated by gender and age to monitor the inclusivity of employment opportunities. The data will provide insights into the contribution of the business concept in generating employment and improving livelihoods.
3. Average worker wage and total net additional wages: The average wage earned by workers in the supported enterprises will be determined, indicating the income levels and economic benefits provided by the business concept. The total net additional wages in US dollars will also be calculated to assess the cumulative economic impact. Wage data will be disaggregated by gender to evaluate gender equity.
4. Increased acreage planted by smallholder farmers: The business concept aims to promote improved varieties of crops among smallholder farmers. The increase in acreage planted with these improved varieties will be monitored, providing insights into the adoption and acceptance of the products among farmers. The data will be analysed by crop type to identify areas of success and potential growth.
5. Average increased yield achieved by smallholder farmers: The impact on smallholder farmers’ productivity will be assessed by measuring the average increase in crop yield achieved through the adoption of the improved climate-resilient crop varieties. This indicator will provide an understanding of the effectiveness of the concept in improving agricultural outcomes for farmers.
6. Improved business performance of targeted seed companies: The business concept aims to enhance the performance of seed companies. Progress in this area will be assessed by monitoring the number of farmers purchasing improved seed, the growth in seed volumes bought by the same farmers, and the increased availability of Early Generation Seed to seed companies. These indicators will provide insights into the market penetration and effectiveness of the concept in supporting seed companies.

In addition to providing direct financial support for business models, the Programme aims to offer successful applicants comprehensive technical assistance in various areas. These include:

1. Seed production technologies and innovations: The Programme will provide guidance and expertise in the latest advancements and techniques related to seed production. This assistance aims to enhance the quality, yield, and consistent availability of the seeds of improved climate-resilient crop varieties.
2. Business management: The Programme recognises the importance of sound business management practices. It will help in areas such as strategic planning, financial management, human resources, and operational efficiency to ensure that the business models are effectively managed and operated.
3. Farmer participation in on-farm trials of new improved climate-resilient crop varieties: The Programme will provide support in conducting on-farm trials of new crop varieties and involvement of farmers through open field days. It aims to showcase to farmers the value proposition of using new improved varieties versus the old varieties they are used to.
4. Marketing and distribution: Effective marketing and distribution strategies are crucial for the success of any seed business. The Programme will provide guidance on market analysis, branding, product positioning, and distribution channels to help applicants effectively reach their target customers and maximize their market potential.
5. Contract farming and out-grower engagement framework: For seed business models that involve contract farming or engaging with out-growers, the Programme will offer assistance in developing frameworks and agreements.
6. Seed Processing: The Programme acknowledges the importance of seed treatment to protect against pests and diseases at the seedling stage. It will offer technical assistance in areas such as post-harvest handling of seeds, seed dressers to be used, processing technologies, quality control, and ESG compliance during seed processing.
7. Monitoring and evaluation: To ensure accountability and measure the impact of the supported business models, the Programme will provide tools and guidance for effective monitoring and evaluation. This assistance aims to help applicants track their progress, identify areas for improvement, and showcase the positive outcomes of their endeavours.

Applicants are expected to submit a funding application justifying their requirements for funding to support the scaling up of the adoption of climate-resilient crop varieties in the target region, as well as expanding into new markets. They should specify the funding amount and duration needed for these specific objectives.

The funding Programme will provide a minimum grant award of US$100,000 and a maximum of US$200,000 which will be specifically allocated to projects that aim to scale up the adoption of climate-resilient crop varieties in the target region and facilitate expansion into new markets. The grant is performance-based, and the funding will be disbursed in tranches based on mutually agreed milestones that demonstrate progress towards these objectives.

Applicants must ensure that the milestones specified in their funding application align with the goals of scaling up the adoption of climate-resilient crop varieties and expanding into new markets. Upon successfully achieving these milestones, recipients will receive the corresponding tranche of funding as agreed upon in the funding application.

 

AECF requires that applicants demonstrate their interest and commitment by providing matching funds. These funds will be provided at a minimum matching ratio of 1:0.5, meaning that for every unit of funding provided by AECF, the applicant must contribute at least half of that amount.

It is important to note that grants received from AGRA or the Syngenta Foundation through other Programmes should not be included in the calculation of matching funds.

The matching funds contribution should comprise 75% cash and 25% in-kind resources. In-kind resources refer to tangible assets such as land, machinery, labour, and other relevant resources that can be quantified and valued. These contributions, whether in the form of cash or in-kind resources, serve as a testament to the applicant’s genuine interest and commitment to the proposed project or initiative.

To qualify for funding, companies must satisfy the following requirements:

1. Operational History and Financial Standing:
   • The company should have been in operation for the past three years.
   • The company must have achieved an annual turnover of at least US$80,000.
2. Private Sector Alignment and Location:
   • The company should be a private sector entity aligned with the designated focus areas.
   • The company should be located in one of the specified focus regions or willing to relocate part of its business operations such as seed production and sales to the two regions of Mbeya and Songwe.
3. Commitment to Funding Matching:
   • The company must demonstrate its commitment to match the funding provided by AECF.
4. Compliance with Regulations:
   • The company should comply with investment regulations in Tanzania.
   • The company must adhere to international human rights, labour standards, environmental management laws, and seed laws/policies.
5. Legal Registration and Establishment:
   • The company must be legally registered and physically established in Tanzania.
6. Non-Involvement in Terrorism:
   • The company must not be involved in any acts of terrorism or provide support to terrorist activities.
   • Regular due diligence regarding this matter must be allowed.
   • The screening will be conducted for all applicants and associated parties against provisions such as; https://sanctionssearch.ofac.treas.gov/, http://www.worldbank.org/debarr,
7. Demonstration of Additionality:

• The company should demonstrate how its activities contribute to additional positive impact beyond what would typically occur without the funding (refer to section 11  on the term sheet for more clarification on additionality).

Each applicant will be evaluated and scored against the following criteria:

1. Outline a commercially sustainable business model.
2. Outline a business model that presents how the smallholder farmers will sustainably benefit from the Programme.
3. Demonstrate sound leadership and strong team capacity to successfully implement the business model. Provide a track record of successes made and revenues from existing clients / in at least one market.
4. Commercializing crop varieties released and licensed under the Tanzania Seed Act of 2003 and whose production meets the Seed Regulations of 2006 as well as authorized to sale by the Agricultural Seed Agency of Tanzania.
5. Demonstrate sound financial health, including three-year record financial accounts, established financial management processes and procedures, and dedicated financial management and extension staff.
6. Demonstrate an understanding of the country context and culture where the project is proposing to operate, in relation to the uptake of improved crop varieties, and how this will be integrated with the proposed model.
7. Present a sound plan on partnerships to deal with the weakest links or critical success factors in the model e.g., increase volumes of Early Generation Seed accessed, delivery of bundled inputs (seed, fertilizer, and agro-chemicals), and linkage to sustainable output markets (grain) for continued seed demand by farmers.
8. The company should be willing to comply with AECF’s ESG and gender policies.
9. Demonstrate how the model will crowd in women and young people as employees, suppliers/farmers, trainers, or distributors.