Value chains and producer organisations

The growing demand for food, the rise of international specialty value chains such as those for organic and fair trade products, and the renewed interest in bio-fuels in response to the ongoing energy crisis, have opened up opportunities to enhance the participation of agricultural smallholders in global markets. As service providers and advocacy networks, producer organizations can play an important role in strengthening the position of farmers and local producers in global value chains.

That development agencies are acknowledging the importance of producer organizations (POs) goes hand in hand with the increasing attention placed on the value chains (or supply chains) that connect farmers with consumers. Such value chains demonstrate the interrelatedness of the production, transportation, processing and marketing of farm products. Improving the coordination of activities of different actors (such as firms) in the chain can reduce transaction costs, help guarantee product quality and safety, and enhance the design of marketing strategies. Producer organizations are considered instrumental in increasing the value generated throughout the chain, such as by ensuring that the quality of products is in line with the standard demanded. They can also mobilize support from other stakeholders and can help farmers negotiate a fair share of the total profit generated.

Featured Article

Pro-poor value chain development: Lessons from Ethiopia

BOAM-book-coverPro-poor value chain development: Private-sector led innovative practices in Ethiopia  (October 2012) documents the experiences of a recently concluded business support programme implemented by SNV-Netherlands Development Organisation. The main development objective of the Business Organisations and Their Access to Markets (BOAM) programme was to introduce innovative approaches aimed at improving business-to-business relations in selected value chains (oilseeds, honey, dairy and fruits) and to scale them up where possible.

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Upgrading in rural value chains

04 February 2013

Markets-and-Rural-Poverty This book explores the place of poor people within a rich variety of value chains, focusing upon lagging, rural regions in Africa and Asia, and how they can “upgrade” within such chains. Upgrading is a key concept for value chain analysis and refers to the acquisition of technological capabilities and market linkages that enable firms to improve their competitiveness and move into higher-value activities.

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Gender inclusive approaches in agricultural value chains

07 December 2012

gender_and_agriculture Published in November 2012 by SNV Netherlands Development Organisation, this practice brief explores women and gender issues in agricultural value chains in Africa and Asia. Across the two continents there are wide disparities in women’s access to and control over productive resources, service delivery and market opportunities. Drawing on a wide variety of case studies, the Brief describes various ways in which the underlying gender constraints are identified and addressed, through an explicit focus on women’s economic and social empowerment.

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Pro-poor value chain development: Lessons from Ethiopia

08 November 2012

BOAM-book-coverPro-poor value chain development: Private-sector led innovative practices in Ethiopia  (October 2012) documents the experiences of a recently concluded business support programme implemented by SNV-Netherlands Development Organisation. The main development objective of the Business Organisations and Their Access to Markets (BOAM) programme was to introduce innovative approaches aimed at improving business-to-business relations in selected value chains (oilseeds, honey, dairy and fruits) and to scale them up where possible.

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Gender inclusion in agricultural value chains

30 September 2012

genderinVCThe central (but under-recognized) role of women in agricultural value chains and the international food security agenda is coming under increased scrutiny in development theory and practice. Published by the Agri-ProFocus network, Challenging chains to change: Gender equity in agricultural value chain development draws on dozens of case studies to show how development organizations and private entrepreneurs are working to improve the position of small-scale women farmers and primary processors in value chains.

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Guest Column: Contract farming can work

26 March 2012

Improving the bargaining power of small farmers

Recent years have seen an upsurge in large-scale land purchases by foreign investors, which can lead to peasant evictions and social upheaval. But less attention has been paid to the parallel rise in contract farming arrangements, which can also endanger the rights of smallholders and contribute to the disempowerment of farmers within the food system. However, contract farming is a market-based approach that can work – provided that it is underpinned by respect for human rights, a focus on the right to food and strong institutional supervision.

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Empowering women pays

26 March 2012

The importance of women in Ghanaian cocoa

CAP_44_PAG_11As support for agriculture climbs up the policy agenda, the spotlight is increasingly focused on smallholder farmers. But one dimension of this is still being regularly overlooked – the role of women on smallholder farms. Markets for agricultural commodities are increasingly linked to the value chains of large food manufacturers and retailers.

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Essential Readings

  • Capacity.org issue 34 (August 2008) Producer organizations and value chains

  • Duncan Mwesige (2010) "Using Multi-Stakeholder Processes for Capacity Development in an Agricultural Value Chain in Uganda" in: Ubels, J., N. Acquaye-Baddoo and A. Fowler (eds) Capacity Development in Practice, Earthscan, pp. 180-193

  • Vermeulen, S., J. Woodhill, F. Proctor and R. Delnoye (2008) Chain-wide learning for inclusive agrifood market development: A guide to multi-stakeholder processes for linking small-scale producers to modern markets, IIED/WUR

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