Background Image
Previous Page  17 / 235 Next Page
Information
Show Menu
Previous Page 17 / 235 Next Page
Page Background

Facilitating Smallholder Farmers’ Market Access

In the OIC Member Countries

7

aggregation is to support the formation of producer organizations and build their capacity

to operate effectively. Neither donors nor governments are well suited to provide the

business development and management training that producer organizations need to

operate more effectively; those skills are delivered better by private service providers or

NGOs with the appropriate capacity. What government and donors can provide, however,

is indirect support—for example, through instruments such as demand-driven funds to

support producer organizations’ developmental needs

Aside from producer organizations, other institutional arrangements are evolving to

better link smallholder farmers to markets. One promising approach is productive

alliances, which have four building blocks: organizing farmers, linking them to markets,

investing in production and marketing, and providing technical assistance. In productive

alliances, the main instrument for forging the links between producers or producer

organizations and agribusiness has been competitively allocated matching grants.

Contract farming is another avenue for enabling smallholder farmers to enter markets

from which they are normally excluded, owing to distance, standards, processing

requirements, or other factors. Smallholders who have access to assets and capital and

who regularly produce marketable surpluses are in the best position to benefit from

contract farming. Contract farming may not be suitable for asset-poor smallholder farmers

or even the majority of smallholders, who are largely subsistence farmers (unless they are

part of an effective producer organization, with requisite management and financial

capabilities).

A final consideration is that insufficient or uneven investment in rural health and

education places smallholder farmers at a disadvantage in adjusting to rapidly evolving

agri-food markets. The technical skills and knowledge that all farmers, particularly

smallholders, require to participate effectively in modern agri-food value chains will only

increase. Programs to improve farmers’ knowledge of production and marketing

strategies, comply with grades and quality standards, and ensure that their production

practices are sustainable will likely have better outcomes if the farmers who participate

have basic education, including literacy and numeracy. A healthy, educated rural

population is in a better position to benefit from the changes and opportunities that

accompany structural transformation and make the transition to work outside of

agriculture.

In summary, no “silver bullet” exists to link smallholder farmers to markets. Successful

policies and interventions to improve smallholders’ links to markets will be shaped by a

particular country's current position in the process of structural transformation, its

endowments, both natural and man-made, and by where the country is heading.

Nevertheless, OIC member countries have much to gain from sharing first-hand

experiences with strategies that successfully linked smallholders to markets, as well as

strategies that failed. Two particularly important areas for technical cooperation are to

better understand how to foster effective producer organizations and how to establish

effective platforms for consultation and collaboration across the public sector,

agribusiness, producer groups, and innovation-driven agencies. Evidence indicates that it

is often easier to form producer organizations than it is to make them financially viable

and sustainable. Issues that warrant attention include the identification of appropriate