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Q&A: “African Farmers Benefit When They Organise Themselves”

Francis Kokutse interviews COMFORT KUDADJIE FREEMAN, agricultural researcher

ACCRA, Aug 28 2009 (IPS) - Research into an initiative to improve the lot of Ghanaian farmers shows how important it is that farmers organise themselves to improve their bargaining power with buyers.

The initiative comes from the local Guinness Ghana Brewery Ltd’s decision to substitute malt with locally produced sorghum. The next step was to contract a number of farmers at Garu in the Upper East Region in northern Ghana to farm and sell sorghum to the company.

A team of researchers has investigated the successes and failures of the project. Francis Kokutse spoke to Comfort Kudadjie Freeman, one of the researchers and a lecturer in agriculture extension at the University of Ghana.

IPS: What exactly is “contract farming”? Comfort Kudadjie Freeman (CKF): Contract farming is a system of farming where production and marketing of the produce is arranged between the farmer and the buyer who is interested in the final product. The buyer sets out certain conditions which could involve many things.

It could take the form of a production contract which sets certain conditions under which the produce is cultivated; and the technology, types of seed and inputs such as chemicals and fertilisers to be utilised on the farm. It could also be a marketing contract.

The contracts are arrived at during negotiations between the farmers and the buyers. The beauty of it all is that risks are shared. For the producers, the marketing risks are reduced as they are borne by the buyers.

IPS: Which crops are involved with contract farming in Ghana? CKF: From the 1970s, palm fruit producers were organised to produce for the Ghana Oil Palm Production Company. There has also been contract farming by pineapple farmers. The latest is the sorghum contract farming at Garu in the Upper East Region.

IPS: What kind of technology is made available to the farmers? CKF: Improved seeds, in the case of farm produce. For animals, it may come in the form of good breeds. In addition to this, new technologies in farming are introduced to the farmers as well as inputs in the form of chemicals and fertilisers to enhance their yields.

IPS: How has it worked? CKF: The idea is to use a non-governmental organisation, in this case Techno-Serve, to manage the coordination between the farmers. The sorghum was to be sourced from small-holders. Techno-Serve would then ensure that the brewery gets the sorghum.

IPS: Do farmers benefit more from this kind of farming than others? CKF: Ordinarily, the farmer is handicapped. Most farmers do not have access to capital, technology and inputs to enhance their yields. Under contract farming, these are provided because the buyer needs the products and ensures that everything is provided to make the farmer deliver.

IPS: What is the economic relationship between the buyers and the farmers? CKF: This invariably depends on the contract that is signed between the farmers and the buyers. Most farmers in the country are illiterate and as such do not understand how negotiations are done. If, at the time of signing, the terms are not spelt out, it would be to the disadvantage of the farmers.

That is why, in the case of the sorghum farmers, Techno-Serve was mandated to negotiate on their behalf and coordinate the entire project from start to finish.

IPS: What were the failures of the project and what were the reasons for these? CKF: During the first and second year the farmers lost out because they could not raise enough money from their sales to pay back credit that they had been given to support their farming activities. As a result, most of them became indebted.

This is because the farmers did not meet the demands of the buyers. This was found to be due to several factors. First was the seed variety that the farmers used. It was realised that these were susceptible to some pests. Then it was noted that the weather was not favourable to the farmers at the time.

It was found that there was so much rain that affected the use to which the produce could be put to.

IPS: Are these schemes sustainable? CKF: Yes, they can be sustained but the first thing that must be looked at is the contract. If this is not done properly, it can lead to problems of buyers taking advantage of the farmers. This means that farmer groups who want to get into contract farming must be organised in order to have a strong voice to negotiate.

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