There has been a drastic fall in prices of the pigeon pea crop since India which is the main importer, restricted import of the legumes from Tanzania in August 2018. Local banks which provided loans to farmers, are struggling to get the lenders to pay back their debt.
Tanzania's Sh537 billion ($240 million) pigeon pea industry is on a sharp nosedive after India banned import of the legumes from Tanzania in August last year.
The unanticipated restriction is now wreaking havoc on hundreds of pigeon pea farmers and traders across the country who are holding hundreds of tonnes of the legume for lack of market.
Reports have attributed the restriction to over-production of the legumes in India in the last two years. The price of pigeon pea which remained stable at between Sh1,500 and Sh4,000 in the last four seasons has drastically dropped to Sh200 as the result.
India's ministry of Commerce and Industry issued a Trade Notice No 13 (2015-2020) restricting imports of the commodity from countries with no bilateral agreement on the crop with the South Asian nation.
The Indian notice caught farmers and traders unprepared as it came at the peak season for the crop, meaning farmers are currently facing significant losses from their investments and the government is now losing a lot in export revenue.
Local authorities in regions known for large scale cultivation of the crop are blaming sharp fall of revenue on the import restriction.
The move is also reported to have put local banks which have provided loans to pigeon pea farmers in difficult time as the lenders fail to furnish their debts.
The Ministry of Agriculture estimates that about 300,000 households are involved in pigeon pea farming.
The heavily criticized ban came despite the Memorandum of Understanding (MoU) signed by the two countries in 2000 under which Tanzania would grow the grains for the Indian market. India is the main export destination for Tanzania pigeon peas and other pulses.
Renewed negotiations between the two governments since then to have the biting ban revoked have borne no fruit to date, heightening growing fears to the farmers where pigeon pea is a leading cash crop.
That is also despite the support of the Geneva-based International Trade Centre (ITC), a multilateral agency with the joint mandate with the World Trade Organisation, to promote exports from the developing countries.
Also involved in talks to rescue the situation are the newly-formed Tanzania Pulses Network (TPN) based in Dar es Salaam and the East African Grains Council (EAGC), a regional body based in Nairobi.
Tanzania's pigeon pea exports to India ranged from 160,000 to 180,000 tonnes annually out of an estimated 200,000 tonnes yearly production.
That accounted for 97 per cent of the exports. The remainder is sold to the Middle East, Kenya, Eastern Europe, and North America.
In India and other Asian countries, the grain is a common good consumed on large scale and is a major source of protein for the population.
The ban also covered green gramme and chick peas with annual production estimated at 100,000 and 80,000 tonnes respectively. Most of them are also traditionally exported to India.
Tanzania is ranked tenth in the global production of pigeon peas and second in Africa. India doubles as the main producer and importer, followed by Myanmar, Mozambique, Malawi, South Sudan, Canada, Ukraine and Russia.
Other countries producing the crop include Kenya and Uganda. It is estimated about 100,000 hectares are under cultivation of the drought-resistant legume across the country, with Babati being the leading district.
During his visit to Tanzania in 2016, Indian Prime Minister Narendra Modi promised his country would increase its imports from Tanzania to one million tonnes annually for all pulses, including pigeon peas.
A year later the import ban was imposed shutting out Tanzania. Nonetheless, countries such as Mozambique and Malawi continued to enjoy the South Asia country's huge market of legumes buyers.
Among those hit hardest, are the farmers in Babati, Manyara, Tunduru, Mtwara, Nanyumbu, Masasi, Newala and Kondoa districts, where pigeon peas has been the leading cash crop for several years now.
Local traders have since last August been buying the beans at Sh200 per kilo from between Sh1,600 and Sh4, 000 in 2016.