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Title: Improving Participation in Agricultural Commodity Markets for Smallholder Avocado Farmers in Kenya: Assessing Growth Opportunities for Women in Kandara and Marani Districts
Authors: Oduol, Judith
Place, Frank
Mithöfer, Dagmar
Olwande, John
Kirimi, Lilian
Mathenge, Mary
Keywords: Agricultural Commodity Markets
Issue Date: Oct-2013
Publisher: Tegemeo Institute
Abstract: Well-functioning factor and product markets can provide the poor, particularly smallholder farmers and the landless, with avenues for wealth creation, thereby expediting poverty and food insecurity alleviation. Yet in developing countries, particularly in sub-Saharan Africa, markets for agricultural inputs and outputs are in most cases missing or disorganised at best. The intensity of marginalisation is more pronounced among smallholder women farmers, because they face higher entry barriers than men in modern value chains. For instance, women have the least 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. Yet, there is paucity of information on the type of interventions that work best to fully integrate women into markets for high value commodities such as fruit tree value chains with and without commercial orientation. The current trend showing that men are increasingly moving into food crops as well as into the previously neglected fruit trees as the prices of export crops fall suggests that there is immediate need for an intervention to improve women’s access to lucrative markets. While a few studies have explored the possibility of using collective action to integrate smallholder farmers and women into agricultural commodity markets, there is a dearth of empirical backing on how collective action improves women’s access to markets for export crops such as avocado, which are exclusively male dominated, without creating imbalance in power relations within a household. Thus, it appears that integrating women into agricultural commodity markets requires a holistic approach that involves a critical understanding of the value chain, with a view to identifying bottlenecks and opportunities for women to participate in the production and marketing of agricultural commodities. This study was an attempt to bridge the aforementioned gap and come up with interventions that are tailored to the needs of smallholder women farmers, with a view to improving their access to and participation in markets for high value agricultural products. In this study, we used the avocado value chain as a case study and focused on women as one of the marginalised groups. We used data collected on avocado value chains in Kandara and Marani, which exhibit exportand domestic market orientations, respectively to (i) establish the level of participation of women in the two value chains; (ii) identify constraints to and opportunities for women’s participation in the value chains; (iii) examine the role of collective action in enhancing participation by women in the stages of the value chains; and, (iv) identify prospects for growth at the stages of the value chain, such as institutional, technological, financial and market innovations that can be harnessed to improve women’s participation. We used a value chain approach and employed mixed methods of data collection such as household surveys consisting of 100 farmers from each of the two study sites, focus group discussion with producers, in-depth case studies of two farmer groups in Kandara and key i informant interviews with other chain actors like nursery operators, traders, processors and exporters. The sampled producers from Kandara consisted of 65 households from avocado groups and 35 from outside groups. The results indicate that avocado enterprise is an important source of income to the sampled households, accounting for 12 percent and 6 percent of the total income and 23 percent and 11 percent of crop income in Kandara and Marani, respectively. In Marani, avocado enterprise seems to be less important to both men and women because the market for the produce is less developed and both men and women tend to prefer food crops such as maize and beans for food security and cash crops like coffee for income. The findings show that the export avocado value chain in Kandara is well developed and elaborate and consists of many actors including nursery operators, farmers, traders, brokers, processors and exporters. On the other hand, the chain for the locally marketed avocado such as the one in Marani is relatively short and includes nursery operators, farmers, brokers and traders. Brokers and exporters are the main players in the avocado value chain in Kandara while retailers and consumers constitute the main buyers in the local avocado value chain in Marani. Nevertheless, the majority of the producers in Kandara, particularly women prefer to sell to brokers despite the low prices offered and the low gross margins derived from this channel. Brokers are preferred to exporters because they provide instant payments and meet the cost of picking, grading and transporting fruits from the farm gate, which are the major constraints that limit the participation of women in female headed households in the export end of the chain. In Marani, consumers are preferred because they offer better prices than other buyers and can be easily reached in the nearby markets without necessarily incurring additional costs such as transport cost. Likewise, retailers are preferred in Marani because they are always available throughout the season and they travel to the farms to collect the produce unlike large scale traders who are unreliable and only transact with the farmers when there is scarcity of fruits in other major producing regions. In general, structures that govern the two value chains differ and they appear to be more developed in the export than in the domestic chain. Similarly, market arrangements tend to be more formalised in the elaborate and well established value chains. Likewise, formalisation of transactions tends to be common at the upper end of the chain. At the production level, a mixture of spot market and contractual arrangements is predominant, but the producers are loosely bound by a tripartite contract through officials of their groups. In the domestic market or local trading in both Kandara and Marani, spot market transactions are the norm rather than the exception and non-formal arrangements based on trust that has developed through repeated transactions and long standing relationships substitute formal contracts. However, stringent quality standards occasioned by an increase in the consumers’ level of awareness of food safety standards in the international market, coupled with the desire by the downstream actors (exporters and ii processors) to maintain customer brand loyalty in the international market necessitates the formalisation of the arrangements. The results suggest that where the chain is well developed and returns from the enterprise are high as in Kandara, more women dominate the production stage, but men tend to own the fields, make decisions on sales of fruits of premium quality such as grade 1 and control revenues. However, joint decision making on sales of fruits of inferior quality and control of proceeds tend to be more prevalent than sole decision making by men and women in male headed households. Likewise, where the chain is well-developed, women participate in the upper end of the chain, but they tend to be confined to low paying and unskilled jobs such as grading, sorting and grafting that require keenness and patience. However, women in female headed households appear to be fully integrated in most of the stages of the export value chain because they assume the responsibility of the household head upon the death of their husbands. Consequently, integrating such women into the export end of the value chain will require alleviating constraints that limit their participation in the export end of the chain such as provision of interlinked services like spraying, harvesting, and grading coupled with prompt payment of the proceeds. On the other hand, integrating women in male headed households in the export avocado value chain will require involving them in training on certification standards. This is likely to improve the quantity and quality of fruits sold to exporters and result in a win-win situation for all the actors. To implement the aforementioned strategy, the increasing importance in joint decision making on sales and proceeds observed in male headed households in Kandara can be exploited. In Marani, where the value chain is less elaborate and the demand for avocado is low, women appear to be fully integrated in all the stages of the value chain because the avocado produced is of low commercial value. Nevertheless, replacing the local variety with the improved ones appears to be the only feasible option to improve the value of the crop. Yet, this strategy is likely to alter the position of women as men are likely to take over most of the functions as the value chain becomes more commercialised, because they have control over the resources necessary for production. Because women in Marani have competitive advantage since they have the knowledge and experience in avocado production, institutions promoting the new variety can tap into the existing strength to ensure that women are not displaced from the chain. Such activities can be embedded in the already existing agricultural and non-agricultural groups where women dominate. The innovations associated with collective action such as contract farming, traceability certificates, writing of grant proposals and the formation of saving schemes notwithstanding, it appears that women’s participation in the produce marketing groups is a necessary but not a sufficient condition for gaining access to lucrative markets such as the export markets. Instead, prompt payment and the provision of business services, such as spraying, harvesting and grading, which are necessary for production of quality fruits that meet buyer specifications, are paramount in alleviating constraints that predispose women to exploitation by brokers. Likewise, contractual arrangements are likely to help structure markets and provide producers with market options that iii offer better prices, but the arrangements need to be accompanied by clear terms and conditions, which should be known to buyers and sellers. For instance, issues regarding grading and pricing as well as mechanisms governing terms of the contract need to be clearly defined in the contract and understood by buyers and sellers.
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