Senegal: Agricultural Sector Risk Assessment
Despite uneven performance, Senegal’s agricultural economy remains vital to the national economy. It accounts for roughly 1/6 of national gross domestic product (GDP), down from nearly 1/4 in the mid-1980s. Although sector output has expanded by 70% over the past 30 years, population growth has quadrupled. During this period, successive government policies have promoted intensification of crop and livestock production via supportive policies and public investments. And yet, growth has been lackluster amid limited take-up of improved seeds and fertilizer consumption that remains among the lowest in the region. A major limiting factor has been widespread reluctance among millions of smallholder farmers who dominate agricultural production in Senegal to assume the risks associated with increased investments in productivity. With only limited capacity to manage these risks, highly vulnerable farmers choose to limit their exposure by limiting their outlays. Moreover, unmanaged risks have a profound impact on sector performance.
A sound understanding of the risks faced by farmers and other agricultural sector stakeholders enables developmentof risk management systems that can at once support new productivity investments, strengthen resilience, reduce losses, and drive sector growth. To better understand dynamics of agricultural risks and identify appropriate responses, incorporate agricultural risk perspective into decision making, and build capacity of local stakeholders in risk assessment and management, the World Bank's Agricultural Risk Management Team (ARMT) conducted an Agricultural Sector Risk Assessment in Senegal (Download PDF). Key findings were summarized in the Senegal Agricultural Sector Risk Assessment Policy Note (Download PDF).
The report has been compiled with extensive analysis of crop and livestock production, price, and meteorological data records over the period 1980–2012. It includes a review of key documentary evidence of yield and risk events together with input from interviews held with farmers, traders, processors and others in rural Senegal and with government, agricultural research staff, donor and other partners between March and May 2014. The results of the analysis are considered in the light of the vulnerability of the different stakeholders to the effects of ex post shock events and the resulting ex ante impact upon investment.
The findings and conclusions of this assessment have increased understanding of the complexities ofthe agricultural risk landscape in Senegal. It has also helped to inform an ongoing dialogue between the Government of Senegal, the World Bank, and other development partners about how best to strengthen the climate resilience of agricultural systems and livelihoods in the years ahead.
Summary of the ReportAt the national level, the analysis highlights agricultural production and livelihood systems that are highly vulnerable to downside risks. These most notably include erratic rainfall and drought as a more extreme but less frequent expression of the same phenomenon. Since 1980, the agricultural sector has been subject to at least 11 major production shocks, with a frequency of a new shock event every three to four years on average across the 33-year review period. The results of the trend analyses indicate that for the 12 crops analyzed, the loss of production over the period was approximately 4.82 million metric tons (MT), with an estimated value of US$1.40 billion, or 3.9 percent of agricultural GDP on an average annual basis. This notably reflects only the ex post impact; the ex ante impact may be of equal magnitude or even greater. According to the analysis, Senegalese agriculture is subject to losses exceeding 10% of gross production value in one out of every five or six years on average due to unmanaged risks. Erratic rainfall and/or drought account for approximately 50% of crop yield reductions. Pests and diseases, especially locusts, account for a further 25 percent. Risks Identification & Prioritization1. Production Risk: The most important factor contributing to crop and livestock production risk in Senegal is weather. The key aspect of weather risk is that due to moisture stress caused either by erratic rainfall, early cessation of rains, delayed onset of rains, or extended drought. The three most significant crop pests are the Senegalese grasshopper or “sauteuriaux”, locusts, and birds (mainly quelea finch). The first two are non–crop specific whereas the third is confined mainly to sorghum and millet (although maize can also be affected). During the 33-year review period, tperiodic locust invasions have caused substantial losses to cash crop, food crop, and livestock (through loss of grazing) production systems. 2. Market risks: Among market risks, the study analyzed price volatility for food crops, cash crops and livestock through the statistical analysis of both domestic and international time-series data. The analysis found considerable variability of domestic food crop prices and more limited variability of domestic cash crop prices. International prices of rice, maize, groundnut oil, and cotton were more variable, with coefficients of variation exceeding 40% in some cases. 3. Enabling environment risks: When ranked in terms of impact and frequency, a key risk noted within the livestock sector is derived from uncertainty over land tenure and access. Access and mobility are critical to pastoral livelihoods. The analysis indicates that inconsistent policy making and implementation of regulations can weaken traditional coping mechanisms and increase vulnerability levels among extensive pastoralist communities, particularly in the north where land use pressures are increasing. Similar uncertainty is derived from the inconsistent delivery of animal health services, including the enforcement of policies on vaccination, quarantine, and movement. Risk Management StrategiesThe study highlights the need for a more targeted and systematic approach to agricultural risk management in Senegal. The proposed focus areas of intervention encompass a broad range of interrelated investments, which together hold strong scope to improve agricultural risk management and strengthen the resilience of agricultural systems and livelihoods in Senegal: 1. Strengthening early warning & response systems, including weather services, for more efficient and productive resource allocation.
2. Improved soil and water management practices and enhanced diversification of smallholder systems.
3. Improving management of pastoral resources (i.e., livestock, water, grasslands, natural cover)
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