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