Inclusive Business Analysis: Scaling Smallholder Soybean Production through Private Sector Collaboration

Scaling Smallholder Soybean Production through Private Sector Collaboration In Kayonza District of Rwanda

Africa Improved Foods (AIF) is a food processor based in Kigali, Rwanda. The company was established in 2016 as a public-private partnership initiative between DSM, IFC, FMO, and the Government of Rwanda.

Maize and soybeans are the key raw materials in the company’s operations. These are sourced locally from the open market and directly from smallholder farmers through the cooperatives.

The Food and Agriculture Resilience Mission Pillar 3 (FARM P3) is an initiative hosted by IFAD which goal is to improve the performance and resilience of food systems over the medium and long term by strengthening private sector engagement and international collaboration around issues faced by smallholder rural farmers.

The project aims to implement a pilot in Kayonza district, Rwanda, until June 2026, aiming to improve farmers' incomes by reducing post-harvest losses of maize and increasing the marketable output of maize and soybeans.

Project Goals: Developing soybean value chain in Rwanda to increase soybean production in Rwanda while improving smallholder farmers income and income resilience by incentivising them to grow soybean. Soybean benefits smallholder farmers by increasing their income, making them resilient to climate changes, and reducing post-harvest losses.

Key findings and recommendations include:

Sourcing efficiency:

Of the three options for AIF to source soybean – 1. local through cooperatives, 2. from local traders and 3. import from regional markets – sourcing from Rwandan farmer cooperatives will save nearly 17% of soybean sourcing costs and conserving foreign exchange for Rwanda. AIF can also potentially source 25% of their total maize requirement from FARM P3 farmers in Kayonza though there is no current commitment on maize offtake either from AIF or Kayonza farmers

Farmer Income:

In year-5, soybean crop will earn $895/ha i.e 2.3X of $388/ha from traditional beans.  Soybean is more resilient to heavy rains compared to traditional beans thereby limiting crop losses in case of heavy rains

Partners: Rwanda Agriculture Board (RAB) is an important partner in developing required seed varieties, mobilising farmers and training them in good agricultural practices.

Key Innovations:

The project aims to provide certified soybean seeds variety to increase yield and crop resilience. Continued improvement in irrigation facilities for soybean crop by providing water channels, solar pumps will make soybean a preferred and climate resilient crop of choice for farmers. Investment in post-harvest infrastructure such as providing mechanical threshers and cemented area for threshing,  leading to increased volume and better quality of soybeans