Monday, 6 June 2011

Is bigger always better?

By Noshua Watson

Why do African farmers have to scale up to participate in global markets? Can’t scale be provided elsewhere in the value chain?

The current debate about food production seems to be whether African farmers need to be big or small to be efficient. I think that the point of John Humphrey’s recent blog post and Dirk Willenbockel’s response (and pointer to a summary of the debate) is that farmers don’t have to be big themselves, they just have to be part of something big.

As Steve Wiggins wrote for the Future Agricultures Consortium, “... let’s get the economies of scale where they are needed: in the supply chains, in processing, transport  and marketing – where lumpy investments and sophisticated know-how count. But let’s leave the farming to the local experts, the family farmers, who have all the incentives to work hard and carefully.”

The Future Agricultures Consortium recently hosted a conference on land grabbing that examined how the social consequences of commercial land concentration threatens rural communities. To avoid this, Olam International seems to make an effort to reach out to small farmers and use hybrid models of large-scale and small-scale farming.

But even if farmers can produce specialised products, get market updates by mobile phone and have decent roads to transport their goods, price volatility leaves small farmers quivering at the tail of the supply chain.

2 comments :

teachamantofish said...

The big vs. small debate often descends into discussions of efficiency but misses the fundamental point - the is a minimum scale in any context at which the absolute return from small scale farming will fail to meet the needs of a farmer's family.

No matter how 'efficient' you are you're going to struggle to thrive on a 1/4 acre plot or less.

n.watson@ids.ac.uk said...

I think the purpose of including small farmers in global value chains is to provide resources for them to move beyond subsistence farming. Even in extremely small holdings, participating in global value chains helps them to increase their yields and profits so they could even afford to purchase food in a store, not just subsist on their holdings. They might also use a small plot just to supplement their income and use the profits to educate other family members or provide transportation to find other work.