Exploit your comparative advantages
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CTA. 2002. Exploit your comparative advantages. Rural Radio Resource Pack 02/5. Wageningen, The Netherlands: CTA.
Permanent link to this item: http://hdl.handle.net/10568/57147
An economist from Zambia?s National Farmers Union suggests that farmers need to be very careful in choosing which crops to grow, so that these match the capabilities of their land and climate, and the type of markets which they can access.
Exploit your comparative advantages Cue: When choosing which crop to grow, there are two major factors that farmers must consider. The first is their agro-ecological situation, in other words, the character of the land they farm and the climate they live in. Temperature, rainfall, gradient of land and soil type will all have an influence on crop choice. The second factor involves the opportunities that the farmer will have to sell the crop. For example, if the farmer lives in a remote area far from any markets, it will be difficult to make a good profit from growing and selling a bulky, low value crop like maize, since the costs of transporting it to market will be so high. A low volume but high value crop like cashew nuts might be a better alternative. With the liberalisation of trade in Africa, the importance of farmers selecting the right crop for their situation has never been higher. Competition from foreign exports means that farmers have to exploit any comparative advantage they have in terms of what crops they can grow and which markets they can access. In Zambia, the National Farmers Union (the ZNFU), is helping farmers to cope with the pressures they have experienced since the liberalisation of the economy ten years ago. Alfred Mwila, an economist at the ZNFU spoke to Chris Kakunta about the problems and solutions for small-scale farmers. IN: ?The farmers have been ?? OUT: ??among our small-scale farmers.? DUR?N 3?21? BACK ANNOUNCEMENT: Alfred Mwila of the Zambia National Farmers Union encouraging farmers to exploit their comparative advantages in order to boost their profits. Transcript Mwila The farmers have been facing the major problem of low producer prices, and the kind of enterprises that they are engaged in are not giving them the profits that will enable them to reinvest in agriculture. So essentially they are engaging in enterprises that are giving them a loss, and this is a big problem. For them to generate a profit they need to sell, they need to be guaranteed of a market, and they need to produce in the most cost effective way, and for this they need some facilitation. Kakunta So as Zambia National Farmers Union, what are you doing in order to help these farmers come out of these negative impacts that have been created as a result of liberalised policies. Mwila One of the things that we engage in is the provision of information to our members, to enable them make timely and economic decisions. We are able to advise our members that the appropriate crops for these areas are ABCD, what is an economic price for which they should sell their farm outputs. Kakunta What about the farmers, what should they do themselves in order for them to benefit? Mwila Our farmers need to embrace issues related to quality. They should be able to produce efficiently, package their produce, and be able to land their produce in their neighbouring countries or beyond, at a cost where they will make a profit. So they have a challenge as well, to position themselves strategically. They should stop growing or engaging in enterprises that are totally unprofitable. Our farmers need to produce, or engage in an enterprise that has comparative advantage. Before liberalisation, there was a deliberate policy to promote maize production, and maize as a result, was even promoted in areas where it is not agro-ecologically suitable, or indeed competitive, because of the distance from the market. So we need to reorient our farmers towards thinking of engaging in enterprises where they know that they are agro-ecologically suitable, and they are profitable. One province for example will be specialising in maize, because they are close to the market. Maize is a bulky product, so they will be able to take advantage of the closeness of the market, and they will be able to make a profit, because they will have less transport costs. Where it is impossible to grow maize, say Western Province, certainly we may just encourage them to grow maize at subsistence level, and not to look at maize as a cash crop. And they should be encouraged to grow what other provinces are not growing right now. And they would certainly have certain comparative advantages in, say, cashew nuts, because of the conditions there. It is certainly most ideal, and we should promote such enterprises. So those are the kind of issues that we feel should be addressed that have been a consequence of liberalisation. Ideally the small-scale sector to us is a very critical sector. It has been growing in number, but unfortunately not contributing to the economy in real terms. So that is a worry, and I think we need address something for this huge potential that exists among our small-scale farmers. End of track.