A global signpost: What way is the market, please?
We need to feed nine billion people by 2050. We, the people of Earth, must produce more food and waste less. That is the top priority of the UN World Food Programme (WFP), too.
The FtMA app is currently being renewed and updated. Photo: Klara Palatova/WFP
THE BEGINNING OF AN AGRICULTURAL TRANSITION
Africa is growing – so is the rest of the world. By 2050, we will need to feed nine billion people worldwide. And there is no doubt that the African continent is potentially the future breadbasket of the world. But today, Africa still has to import food and the bill continues to rise: It will approximately reach 100 billion U.S. dollars by 2030. Naturally, it is a top priority for the UN World Food Programme (WFP) to increase global food production while lowering food waste.
Smallholder farming households produce more than 70 percent of the food supply in Africa and Asia. At the same time, they account for half the hungry people worldwide. For too long, they have been subject to a range of barriers preventing them from fully realising their potential. Access to much-needed finance – for example to buy seeds, fertilisers, farming equipment, or crop loss insurance in case of poor rainfall – is one of those barriers and often tied to deeply rooted obstacles for smallholders; they simply lack financial capital, hard assets, or a credit history. In this sense, the Farm to Market Alliance (short: FtMA) was convened by WFP to support African smallholder farmers to do farming as a business. Through a holistic approach, FtMA helps smallholders to enter the market across the entire value chain – starting as early as planting the seeds.
The consortium between Alliance for a Green Revolution in Africa, Bayer Crop Science, Rabobank, Syngenta, Yara International ASA and WFP was established in 2016; shortly afterwards they developed PATH. The PATH solution empowers smallholders and supports them to become reliable market players across four pathways: Predictable markets, Affordable finance, Technologies and quality inputs, and Handling and storage solutions.
THE PATH TO COMMERCIAL FARMING
Through working with local agricultural players, FtMA coordinates market engagement, trainings, collective expertise, products and services – every single element helps smallholders to confidently plan, grow, store and sell their produce with the lasting effect to boost their productivity, profitability and resilience.
FtMA’s demand-led approach builds long-term linkages between smallholders and other agri-market players, including buyers, financial service and insurance providers, and input and equipment suppliers. FtMA essentially functions as a ‚neutral broker’ between market demand and smallholder supply.
One example of how to develop a more profitable and stable agri-market environment for smallholders are pre-planting buying contracts between smallholders and commercial buyers. These contracts create a stability that financiers could take as collateral for smallholders’ loans for inputs, equipment and insurance against climate- and pest-related risks. Buyers, on the other hand, have the opportunity to better plan their logistics and are able to rely on confirmed product supplies. It is a win-win for all sides.
This ending season, FtMA has successfully engaged with over 87,000 smallholder farmers in Kenya and Rwanda through PATH. So far, crop purchases by commercial buyers generated more than 31 million dollars. Moreover, roughly 50 local private sector partners joined in, increasing the number of transactions significantly.
"Farm to Market Alliance", FtMA, supports farmers, for example in Rwanda. Photo: Klara Palatova/WFP
DIGITILISATION AND INNOVATION
In order to improve the quality and quantity of products and services, FtMA strongly advocates technological innovation, such as introducing digital tools and technical devices. Digitalisation started through group activities, for instance recording the total volume of aggregated crops or collectively ordering inputs.
Really important are the practice of crop aggregation and aggregation centres. Farmers deliver their produce to collection points – referred to as aggregation centres. For smallholders, bringing their produce to such centres can offer many benefits, such as better purchase prices, an increase in profitability or risk reduction. Working together, it can also be easier for smallholders to participate in farmers’ cooperatives and get seeds, fertilisers and equipment.
FtMA is enabled by a digital platform – consisting of a mobile app, SMS gateway and web portal – that was co-developed by MercyCorps’ AgriFin Accelerate program and the WFP’s Innovation Accelerator. Through this digital tool, users can collect and sell their produce, order seeds and (post-harvest) equipment and receive digital receipts. That in turn fosters the trust between smallholders and the service provider or buyer. It makes pricing, commissions and payment periods more transparent, and farmers can easily track all of their transactions. In addition, digital receipts – that are recorded by the app – can be used as a collateral for financiers, and help smallholders establish a credit history, helping them to get loans and other financing.
Moreover, FtMA created a platform for smallholders and other agri-market players to connect with each other. Which has the result that one of the most valuable benefits from digitalisation is access to real-time information: Knowing the situation at aggregation centres can prevent overload of goods; information about delays in produce pick-up, price negotiations, and questions can be shared immediately. Of course, this principle works both ways, meaning that donors and investors can decide whether investing in a smallholder or farmer organisation would pay off, based on the smallholders’ digital data on transactions, their harvested and sold volume, or quality and quantity of their produce.
With the help of cutting-edge digital tools, FtMA improves coordination and transparency, and strengthens the trust between smallholders and their various agri-market partners. This is most visible in the positive impact on the lives of the more than 87,000 smallholders profiting from FtMA’s products and services in two African countries. A 2018 sample survey in Rwanda demonstrated that the average production of participating smallholders increased by one third over the first two seasons. Farmers who sold their produce with FtMA saw an average increase in incomes of 83 percent in that time. Altogether, the 31 million dollars generated in crop purchases by buyers highlight the necessity of the transition in the agriculture market and making markets more accessible for smallholder farmers, so they do not only feed themselves but also the global population. At the same time, they become competitive contributors to local and regional markets.
The harvest is regularly checked and controlled. Photo: Klara Palatova/WFP
GERMANY’S IMPACT
In cooperation with local partners from public as well as private sectors, FtMA identifies the smallholders’ needs and tailors products and services accordingly. This is only possible thanks to the supporters of the Farm to Market Alliance who share the common commitment to make markets work better for smallholder farmers and who contribute with their resources and expertise. Among others, the German Federal Ministry for Economic Cooperation and Development (BMZ) is one such supporter of the Kenyan operation.
Projects like this are born in the labs of WFP’s Innovation Accelerator which identifies, supports and scales up high-potential solutions to hunger worldwide. It provides WFP entrepreneurs, start-ups, companies and NGOs access to mentorship, training, financial support, expert insights and WFP operations. The WFP Innovation Accelerator is generously funded by the German Federal Ministry for Economic Cooperation and Development (BMZ), the German Federal Foreign Office and the Bavarian State Ministry of Food, Agriculture and Forestry.
Roseline Siama is a farmer working as FtMA Agribusiness Advisor. Photo: Farm to Market Alliance
FTMA IN KENYA: ROSELINE’S STORY
Roseline Siama, a 40-year-old mother of four from the western part of Kenya, used to be an average housewife and a member of a women farmer group. After her group started working with FtMA, Roseline learnt how to practice farming as a business alongside good agronomic practices and post-harvest management. Within three seasons, she earned enough money to triple the size of her farm, pay for her children’s school fee, expand her pig farming business and on top of that, invest in a catering enterprise. Today, as an FtMA Agribusiness Advisor, Roseline assists other farmers to easily access farm inputs and markets, as well as services such as good agronomic practices and postharvest handling and storage. During harvest, she aggregates produce from farmers and links them to a ready buyer, providing a predictable market for farmers at a competitive price. “Most women, including myself used to fully depend on our husbands as sole providers in the home”, Roseline says and adds: “well, not anymore.”
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Four interviews kick off the relaunch under the new name „Food4Transformation“, asking the same questions from different perspectives. Dirk Meyer, Federal Ministry for Economic Cooperation and Development, thinks: less individual solutions are needed, but more systemic approaches. Because in addition to the goals for food security, the issues of climate and biodiversity must also be taken into account.
A Contribution by Dr. Fatima Olanike Kareem and Dr. Olayinka Idowu Kareem
High agricultural prices affect developed and developing countries alike, but the problem is aggravated for the latter through the lack of or inadequate resilience measures. Dr. Fatima Olanike Kareem, AKADEMIYA2063, and Dr. Olayinka Idowu Kareem, University of Hohenheim, explain what can be done to mitigate the negative effects on food security.
The consequences of the Russian invasion of Ukraine have enabled many countries to open up new export markets for their agricultural goods. However, smallholder farms have been largely left out. Drawing on his experience in India, our author gives a brief overview of how this can be changed.
Iraq suffered many years of war, sanctions and economic crises. However, Ally-Raza Qureshi from the World Food Programme in Iraq sees progress. But now the effects of climate change are becoming apparent in the country. What is to be done?
The world is currently experiencing a historic food crisis. High fertiliser prices are part of the problem. In addition to the necessary short-term aid measures, the crisis ought to be made use of to develop and implement longer-term fertiliser strategies for sustainable, in particular smallholder increases in production in the Global South.
In a world facing crises – from pandemics, armed conflicts, and climate change – how do we ensure everyone has enough food within planetary boundaries? A new podcast by Food4Transformation discover solutions talking to government officials, scientists, NGOs and farmers around the world.
The Gaza Strip depends heavily on humanitarian aid, more than ever with the current war. Gaza population is very young: Half of them are children. What is their situation on the ground? Questions for Lucia Elmi, Unicef Special Representative to the State of Palestine.
Women and girls in poorer countries are affected in particular ways by the multiple crises the world is currently facing. Uncovering the linkages between gender, resilience and food security, experts from International Food Policy Research Institute (IFPRI) look at ways to support women and girls’ capacity to respond to crises.
The armed conflict between Israeli forces and the Hamas is escalating. What does this mean for a Gaza, region that was already heavily dependent on external aid? Questions for Dr. Muriel Asseburg, Senior Fellow at the German Institute for International and Security Affairs (SWP) in Berlin.
Chancellor Angela Merkel in the Podcast of the Federal Government
At the start of World Food Week around World Food Day on 16 October, Chancellor Angela Merkel stressed that the fight against global hunger will only be successful with international responsibility and solidarity (german only).
From measures to promote biodiversity in Germany to more sustainable cocoa cultivation methods in Ecuador: WWF works at many different levels. At the Green Week, it will be demonstrated just how multifaceted nature conservation work is and what role each individual's decision plays.
The Agriculture and Food Security Cluster of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in Zambia shows how synergies among different projects and partner organisations can help people to eat healthier, diversified food. A delegation of the Bonn based Division of Agriculture and Rural Development learned this in a field visit in the Eastern Province of the Southern African country.
Felix Phiri has been Head of the Department of Nutrition, HIV and AIDS at the Ministry of Health in Malawi for almost 20 years. A conversation about constants and change.
In Himachal Pradesh, India, natural disasters are becoming more frequent and climatic conditions are changing – with negative consequences for apple production and farmers' livelihoods. Holistic and multidimensional innovation bundles are required for the entire value chain in order to make the food system more resilient in the future.
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