Facilitating Smallholder Farmers’ Market Access
In the OIC Member Countries
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Infrastructure and trade logistics
Infrastructure refers to the quality and quantity of physical infrastructure such as
transport, power, and information and communications technology (particularly
telecommunications). More broadly, infrastructure can also refer to financial
infrastructure (such as banking) and access to finance (described in the next section).
TRANSPORT
Poor access to transport limits opportunities for smallholders because it increases the
costs of production as well as marketing. Data on rural access indicate that in 2004 only 53
percent of the rural population in OIC member countries (Annex Table 1.23) had access to
an all-season road within two kilometers (typically equivalent to a walk of 20–25
minutes). As the Uganda case study demonstrates, households located far from major
roads and urban centers are much less likely to market a large portion of what they
produce.
The poor quality of roads not only compounds post-harvest losses (as seen in the Nigeria
case study) but limits farmers’ choice of crops to produce, often preventing them from
growing high-value, perishable crops that must be shipped to a trader or processor very
soon after harvest. In Mozambique, the wholesale price of a 50-kilogram bag of dried
cassava roughly doubles over a 200-kilometer distance, from about MT 160 per bag in
Namina to MT 350 per bag in Nacala Port.193 This outcome is bad for smallholders, who
receive lower prices, as well as consumers, who end up paying higher retail prices.
Investments to improve road infrastructure and extend and upgrade rural feeder roads in
main production zones tend to have high payoffs. Investments in ports and railway
systems are also critical in many countries. It is not enough to invest in new infrastructure
and upgrade existing infrastructure; adequate attention also needs to be given to funding
its operation and maintenance.
ELECTRICITY
Access to electricity—as well as its cost and the reliability of supply—influence the market
opportunities available to smallholders, their production costs, and marketing costs. In
about 45 percent of OIC member countries, less than half of the rural population has
access to electricity (Annex Table 1.22). As the Bangladesh case study shows, increased
access to electricity was an especially important factor in expanding cold storage facilities
for potatoes and enabling farmers to command a higher price for their produce than if
they had sold it immediately after the harvest. Farmers in Bangladesh earned an
additional 40 percent of the margin in the potato value chain when they stored part of
their potato crop.194
TELECOMMUNICATIONS AND OTHER INFORMATION TECHNOLOGY
193 Dononvan et al. (2011).
194 Reardon et al. (2012).