Food and nutritional insecurity are of significant concern in developing countries, especially across sub-Saharan Africa (SSA), where around 57% of the population cannot afford a healthy diet.

Food insecurity is aggravated by micronutrient deficiencies, also known as 'hidden hunger," which constitutes a severe impediment to social and economic development and achieving the United Nations Sustainable Development Goals (SDGs) by 2030.

Critically, the consumption of fruits and vegetables in SSA is far below the recommended amount of 400 g/capita/day.

Promoting better access to more nutritious foods across SSA will be crucial to ending hunger and malnutrition, as was discussed at the Climate Change summit last November in Scotland.

Key markets comparison

The seed sectors in Northern and Southern Africa are considerably further advanced than is the case in SSA. The Mediterranean vegetable seed sectors (Morocco, Tunisia, Egypt) are closely linked to the EU markets they serve and receive hands-on assistance in establishing and developing their operational guidelines and business undertakings.

In contrast, the vegetable seed sector SSA has been slow to develop and has until now received little attention in the development agenda.

Sub-Saharan Africa is not on track to meet its development target of ending all forms of hunger and malnutrition by 2030. In fact, hunger in SSA is increasing across all regions, and almost 20% of the continent's population is undernourished, the highest in the world.

It is evident that seed systems have an important role to play in the region because agricultural productivity remains extremely low, and the use of improved varieties is highly limited. So African farmers are deprived of the benefits of modern plant breeding, both to them directly as producers, and ultimately to the consumers they serve.

The early 1990s saw a dramatic change in economic policy in SSA as it was argued that markets and private companies were more efficient in all areas of economic activity, including seed production. Seed laws and regulations were liberalized as public seed enterprises were privatized in many countries and in this more favourable climate, private companies started to enter the seed business.

In marked contrast to the situation in Asia, seed sector reform in Africa has not yet led to an expansion of hybrid seed production with the notable exception of hybrid maize. For example, it is estimated that 70% of the vegetable seed market in India is occupied by hybrids.

In SSA, the certified vegetable seed segment is dominated by OPVs and accounts for less than 11% of vegetable seeded area and an estimated 55% of estimated value in 2020, although there is a generalized lack of information on the areas of vegetable production at the national level as well as an absence of valid statistics on vegetable seed demand or sales.

Most of the new private companies in Africa have built a business around trading and distributing seed but few have invested in R&D to develop their own locally adapted varieties. There is still little breeding of vegetables or other crops for the domestic market in SSA, despite the entry of several multinational seed companies. Most of the vegetable seed is still imported from outside the continent, while local companies continue to produce seed of open-pollinated, rather than hybrid varieties.

Lack of R&D capital

One of the major shortcomings of the African vegetable seed sector is the paucity of R&D investment. With only a handful of seed companies doing vegetable research in Africa, it is estimated that only about USD 5 million is spent on vegetable R&D by the private sector in SSA. This would be 0.5% of global investments, while the sub-continent accounts for 14% of world population.

Some countries such as Tanzania, Kenya and Uganda mandate that all seed produced domestically is certified by a seed certification agency. This can significantly increase the cost of domestically produced vegetable seed and create an incentive to import seed. Few countries have the capacity to provide an efficient certification service for vegetable seed so it may be better to rely on minimum seed quality standards and not to require seed certification.

Counterfeit seed is also a severe problem in SSA countries. It appears that regulatory agencies and law enforcement authorities in these countries give low priority to counterfeiting in vegetable seed as these are not considered strategic crops. Various sources indicate that fake vegetable seed represents 20-25% of seed sown.

And, without proper mechanisms to address this threat, seed companies will be reluctant to invest and prefer to do business in countries where they are better able to protect their brands.

The future looks bright

The certified vegetable market stood at $129.4 million in 2020, of which 64% refers to Eastern-Southern Africa. (IHS Markit Crop Science data).

Onions, tomatoes, okra, green beans, peppers (sweet and hot) comprised 70% of certified market value in 2020.

The certified seed potato market in select SSA was set at $42.7 million in 2020. Therefore, both certified vegetable and potato seed markets reached an estimated $172 m in 2020.

Both markets are expected to continue to grow in the 2020 to 2030 period reaching $205 million (vegetables) and $62 million for potatoes, or a total of $267 million.

In conclusion, the forecast for certified seed penetration of select SSA vegetable market by 2030 on 1.17m ha of land; valued at an estimated $205m.

If you are interested in more details of our reports on Africa, please contact Crop Science special reports publisher Dr Alan Bullion at alan.bullion@ihsmarkit.com

Posted 19 January 2022 by Alan Bullion, Director of Special Reports & Projects, Agribusiness, S&P Global Commodity Insights

This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.