Despite considerable strides made in sugar industry since privatization in 1996, Tanzania still face an annual sugar deficit well above 300,000 tons, leading to an annual sugar import bill of USD$132 million. In addressing this challenge, Tanzania has embarked on ambitious program to expand the sugar industry by establishment of new sugar estates. In view of climate change challenges, the program should be aligned to the future conditions which will have bearing on the profitability of investments. A study was conducted to assess the effect of climate change on agricultural droughts in terms of water deficit index (WDI), throughout the near-term (2010–2039) at the newly established Mkulazi II Sugar Estate at Dakawa, Mvomero District Tanzania, under two greenhouse gas emission scenarios. Baseline climate indicates serious drought risk for sugarcane crop for months of July through November when WDI ≥ 0.75, and low risk during rainy season (March–May). Near-term period will become drier than the baseline climate for months of May–December while drought will subside during January–April with respect to the baseline climate. The projected changes in water deficit at the study site point to two facts: One is that rainfed production will not be possible, considering the projected decline in short rains (October–December), and the other is that water demand, in terms of crop water requirement, will increase due to increased drought conditions. In order to sustain sugarcane yields in the future, there will be a need to design an irrigation system that accounts for the climate change challenges.
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