Only 1.6% of Somalia's total land area is cultivated, and 69% is permanent pasture. There are two main types of agriculture, one indigenous and the other introduced by European settlers. The Somalis have traditionally engaged in rain-fed dry-land farming or in dry-land farming complemented by irrigation from the waters of the Shabeelle and Jubba rivers or from collected rainwater. Corn, sorghum, beans, rice, vegetables, cotton, and sesame are grown by both methods. Somali and Italian farmers operating the banana farms practice more modern European-style techniques, as do some of the newly created Somali cooperatives. A system of state-administered farms grew rapidly during the early 1970s.
The commercial crops, bananas and sugarcane, are grown on irrigated land along the two rivers. Bananas constitute the nation's major commercial crop; output was 50,000 tons in 1999, down from 110,000 tons in 1990. Sugarcane is cultivated at Giohar and Jilib by a state-owned company. Sugarcane production in 1999 totaled some 210,000 tons, down from 500,000 tons in 1985. Somalia is the world's leading producer of frankincense.
Between 1975 and 1991, all land was nationalized. Existing customary rights were generally honored, but the state took over large areas of irrigable land in the river valleys. Plantations had to register to obtain a concession grant, with the value of the land itself excluded from the selling price. In 1993, privatization and assistance from Italy (the main market for banana exports) began to help revitalize the agricultural sector. In 2001, agricultural products accounted for 47% of exports and 17% of imports; there was an agricultural trade surplus of $10.2 million.