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Title: Improving Participation in Agricultural Commodity Markets for Smallholder Farmers in Kenya: Assessing Growth Opportunities for Women
Authors: Kirimi, Lilian
Mathenge, Mary
Olwande, John
Oduol, Judith
Mithöfer, Dagmar
Place, Frank
Keywords: Agricultural Commodity Markets
Issue Date: Oct-2013
Publisher: Tegemeo Institute
Abstract: Agricultural growth, especially in the early phases of development, is fundamental to broader economic growth and successful poverty reduction. This is because of high concentration of the poor in this sector, its strong growth linkages with other sectors, and its potential to offer low food prices to the urban poor (DFID, 2005). However, much of Africa’s agriculture is characterized by semi-subsistence, low-input, low-productivity farming systems, which are not favorable to achieving this broad-based growth. Transformation to a more commercialized agriculture is, therefore, unavoidable if the broad-based growth is to be achieved (Morris et al. 2009). Better and more accessible markets are a fundamental ingredient to a more commercialized agriculture, just as technologies and macroeconomic policies, since they are key determinants of farm productivity, food prices, and food availability (ILRI, 2011). Wellfunctioning markets send effective signals that influence incentives for investments by firms, households and workers, and enhance their efficiency and opportunities (ILRI, 2011). Yet in developing countries, particularly in sub-Saharan Africa, markets for agricultural inputs, outputs and finance remain thin (Poulton et al., 2006), and infrastructure, both ‘hard’ (e.g. roads) and ‘soft’ (e.g. telecommunications and information) are poor. The result is high transaction risks and costs (Poulton et al., 2006), which can distort crop choices and significantly dampen farmers’ returns from market participation as well as discourage them from producing for the market (ILRI, 2011). While market failure is a major constraint to most smallholder farmers, the effects are compounded for the marginalised groups such as the poor, women and households in low potential areas (Poulton et al., 2006; FAO, 2011). The intensity of marginalization is more pronounced among women farmers because they face higher entry barriers than men in modern value chains. For instance, women have less access to and control of productive resources such as land, capital and agricultural services like credit and training that are necessary for increasing yields and moving from subsistence to market oriented production (Jiggins et al., 1997; FAO, 2011). Consequently, women generally produce for more localized spot markets and in small volumes than men, and when they are involved in marketing of agricultural produce, they tend to be concentrated at the lower levels of the supply or value chain, and in perishable or low value products (Baden, 1998; World Bank, 2003). Addressing the challenges faced by these marginalized groups in accessing agricultural markets, remains a necessary priority in efforts to foster broad-based agricultural growth, and thereby contribute towards poverty reduction. However, interventions necessary for integrating marginalized groups into markets may differ by commodity market chain and by marginalized group. Hence, it is important to understand the constraints to market participation and types of 2 interventions that can overcome these constraints in order to unlock opportunities for involvement along a given value chain. Identifying specific agricultural value chains and interventions that could offer the best opportunities for sales, income, and poverty alleviation for marginal groups is a critical step in the process of making beneficial investments that can transform the fortunes of these groups. Further, analysis of value chains in combination with characteristics of marginalized groups of interest and the nature of potential interventions would be helpful in informing the design of such nterventions for greater impact. This study sought to identify critical challenges that need to be addressed and assess growth opportunities that could be exploited to improve access to and participation by women smallholders in agricultural markets along three value chains namely sweet potato, avocado and indigenous chicken. This was achieved through detailed value chain analysis of these selected enterprises and case studies on selected marketing innovations that could enhance market participation.
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