Farm Concern International Winning markets for farming communities Smallholder commercialization Based on ‘Commercial Village Approach’ Mumbi Kimathi Mrs.
Farm Concern InternationalWinning markets for farming communities
Smallholder commercialization
Based on
‘Commercial Village Approach’
Mumbi Kimathi Mrs.Market & Chains Analyst
Two Roads In farming Life
PRODUCE IDENTIFY MARKET
FIND MARKETS PLAN TO PRODUCE
“road less traveled”
“road for most”
PRODUCE HARVEST
Burst
Boom
44%
11%
22%
11% 11% 11% 11%
0%
10%
20%
30%
40%
50%
Cassava Flour Trading Challenges in Kampala
Poor quality
Price flactuations
Low demand
none
scarcity
High buying price
High taxes
36
27
18 18
9
0
5
10
15
20
25
30
35
40 Local millers
Distant Millers
Brokers
Farm gate
Own produce
Trigger commercialization
• Identify markets• Conduct value chain analysis• Identify routes for market entry• Develop value chain partnerships• Prioritize products from farmers’ basket –
avoid wide range or too narrow range• Conduct Cost Benefit Analysis along the
Farm-to-Market chain• Assess target farmers• Agro-ecological zone analysis• BDS Mapping
Cash economy
Zone Characteristics
Village status Description Value Chain Status
Zone 4 Commercial BDS systems establishedRelatively high investment levelsMedium / large –scale farmersLow poverty indexHigh private sector investments Cash economyActive regional and global value chainsWell established business partnerships Cash economy
Developed / Commercialized
Zone 3 Semi-commercial production systems Active local value chains Weak national / regional value chains Relatively seasonal value chain Semi-commercial BDS systemRelatively developed marketing infrastructureSeasonal cash economy
Intermediate
Zone 2 Interest by playersInconsistent value chainsUnder-developed Marketing infrastructureMix of food and cash economy Semi commercial production systems
Developing
Zone 1 Minimally identifiable value chains and BDS systemsLargely food economyMinimal economic activities Large parcels of land characterized by low productivity
Remotely developed
Zone 0 Totally underdeveloped value chainsFood economyNo identified economic activities No BDS systemsNo highlighted interest by buyers
Totally undeveloped
Commercial Village Approach
• Commercialize typical African Village • Clusters of producers groups within a village
setting• Comm. Vill.: 500 Households• Currently: 60,000 HH ( Avg. 6 members/HH)• Village co-ordination unit• Multileveled leadership structure
– Executive committees– Commercialization S-B– Marketing S-B– Financial S-B– Social S-B
African Traditional Vegetablescont… Case study
• Consumption for ATV in Nairobi has increased from 31 Tonnes in 2003 with an estimated farm gate value of US$ 6,000 to
• A current 600 Tonnes in 2006 with an estimated farm gate value of US$ 142,860
• Farm gate prices increased by 30% and the current supply of 500 Tonnes is estimated to account for 60% of the demand level.
• The ATV distribution network includes supermarkets, kiosks, informal markets and street markets.
Bridging gap btw poverty & creditworthiness
• Trigger commercialization• Market Access Financial Services
(MacFis), a pro-poor credit line• Graduation from MacFis after 2 years,
market support offered for 4 years• Commercial Village Financial Services
– Commercialization triggered through input credit for poor communities
– Mandatory savings from sales– Repayment for loan recovered from paymentsFarm Concern Intl’ among 5 global winners of
Pro-Poor Innovative Challenge[ PPIC] CGAP