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Tuesday, October 21, 2014
- Following training by the Alliance for a Green Revolution in Africa, a hundred farmers in central Kenya, armed with an improved understanding of their local markets are commanding higher prices for their bananas.
"These farmers used to sell bananas by just looking at the bunch. A trader would come and dictate the price. Before, they were selling at three shillings per kilo (0.04 U.S. cents), now they are selling for up to ten times more," Anne Mbaabu, director of the Market Access Programme of the Alliance for a Green Revolution in Africa (AGRA) told IPS.
AGRA, an organisation which unites farmers, research scientists, business and governments to boost productivity and incomes, has been working with the Kamahuha Farmers Group, connecting the farmers with buyers who they communicate with directly using mobile phones.
"The buyer may say, 'I want bananas that are not injured, I want them of this maturity and in this quantity.' The farmer will then negotiate the price as opposed to previously, when he would just estimate the price," Mbaabu said.
Improving access to market information and building the capacity of African farmers to understand market trends and needs, was the highlight of a meeting of agricultural experts held May 13-15 in Nairobi.
With the theme of the event being the role of markets in accelerating Africa’s economic growth while improving incomes of poor farmers, it was stressed that for farmers to gain, they must not only produce, they must have effective access to markets in order to sell their harvests at fair prices.
Markets in Africa, it emerged, are poorly-organised and volatile. Farmers lack market information on current wholesale or retail prices that they need to negotiate good prices for their produce.
"You have to know where the market is first. If you do not have access to information, the farmers cannot even access markets or participate in them. So the big issue is providing adequate information for farmers to be aware of markets, but also to be aware of the needs of markets because market needs are changing a lot," noted Akinwumi Adesina, AGRA’s Vice President for Policy and Partnerships.
Experts like Ade Freeman of the International Livestock Research Institute (ILRI) argue that domestic and regional markets provide the greatest opportunity for African farmers, rather than markets further a field.
The population of the East African Community – Kenya, Uganda, Tanzania, Rwanda and Burundi – is roughly 100 million; over 389 million people live in the countries that form the Common Markets for Eastern and Southern Africa.
"We are talking about huge markets, in terms of the numbers of people that are involved. And people will always need to buy food. Some of these countries have been experiencing economic growth of about five to six percent per annum. So, all factors that favour increasing demand for agriculture in these markets are moving in the right direction, providing an opportunity for regional and domestic markets to be exploited," Freeman said.
There are several hurdles that have stifled regional trade, including high tariffs. "Tariff structures in Africa are actually much higher between countries than they are between Europe and Africa. So this makes it difficult for us to trade between ourselves," Adesina pointed out.
There have also been calls for customs regulation standards (requirements which someone exporting or importing goods or services is expected to adhere to, and they vary from country to country) to be harmonised to make it easier for people to transport goods across borders.
Access alone is not enough
But for poor farmers to increase productivity and enter these markets, they need to be supported with improved seeds, fertilisers, irrigation, and pest management technologies. And government intervention to provide this support constitutes subsidies, a thorny issue at international trade talks.
Mbaabu’s take is a different one. "These subsidies, as they are called, are targeted. It's not just mass subsidies; it is targeted at those who cannot be able to afford, and then once they are able to get these inputs, they become self-sufficient in their food production and then you end up reducing poverty. So let us not criminalise subsidies; it is support, targeted support to our farmers."
In Kenya, the government has over the last year reduced fertiliser prices from about 79 dollars to the current 33 dollars. This is still too costly for many farmers, according to Peter Njoroge, chair of the League of Small-Scale Coffee Farmers. He told IPS that a good number of farmers were abandoning farming due to the high input costs, and he wants authorities to reduce further the fertiliser prices or even distribute them free of charge to small producers.
The Malawi government was commended for going against the grain to provide subsidised hybrid maize seeds and fertilisers to its farmers beginning three years ago. It has since moved from a serious food deficit to becoming a net maize exporter.
And the results of farmers using high-yielding inputs are tangible. "The standing point is an increase in productivity in areas where farmers use improved inputs," Joseph Mwangangi, the regional director of Agribusiness Strengthening Programs at CNFC Inc, an organisation dedicated to increasing and sustaining rural incomes through empowering farmers in developing countries, told IPS.
Mwangangi, whose organisation works with the Agriculture Commodity Exchange in Malawi pointed to a recent study by the Bunda College of Agriculture at the University of Malawi, which found that up to 86 percent of farmers were using improved inputs. This, the study says, has led to increased or improved household food security.
Even with these gains, not everyone is in favour of subsidies to poor farmers. Hans Binswanger, a private consultant on agriculture and rural development from South Africa, cautioned about potential risks associated with subsidy programmes.
"If not designed and implemented properly, they can cause disruptions in markets, resulting in high prices which are completely unnecessary, and which are costly to the government, costly to its people. This undermines the intended benefits of the fertiliser and seed subsidy programme," he stated.