Big companies ? bigger profits for small farmers
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CTA. 2003. Big companies ? bigger profits for small farmers. Rural Radio Resource Pack 03/05. Wageningen, The Netherlands: CTA.
Permanent link to this item: http://hdl.handle.net/10568/57407
IITA assists farmers in Nigeria to market their products to private companies by providing market information and organising bulk selling.
Cue: Small scale, poor farmers, don?t often get the chance to supply to big companies like Guinness or Nestl‚. But, thanks to an initiative by IITA in Nigeria, that?s changing. Of course the big companies want large quantities of the commodities they buy ? hence big plantations. But, if farmers can organize themselves into groups so that together they can meet the demands of quantity ? and quality ? then why not take advantage of the market and the higher price that goes with it? Of course that also means using inputs such as fertilizers to get the quality required. Kehinde Makinde, a marketing economist with IITA, tells Sarah Reynolds how it works. IN: ?We work with them to . . . OUT: . . . actually help farmers to create wealth.? DUR?N 3?38? BACK ANNOUNCEMENT: Kehinde Makinde of IITA, helping farmers in Nigeria to tap into a new market. Transcript Kehinde We work with them to first let them understand the market requirements. These are the things that the market wants. For instance, if you pick a crop like sorghum, Guinness will tell us that we need this quantity. We need this moisture content, the seed must be clean, the grain must be dry. All that is passed to the farmers and then we work with them because the farmers are organised in groups. We provide them training in groups to make them formidable to be able to meet with the challenges ahead. So we work with them to work along commodity lines. When we do this, we facilitate them with inputs and that is because we want them to be able to produce those crops. Everything that they require - fertilisers, seeds are obtained from the private sector. We link them up with the private sector companies who are in business to do this. Reynolds How do farmers take to this new market for them and how do they take to being given very strict advice and help - whatever you like to call it, but they have to produce what the market wants. How do they react? Makinde The farmers have been very happy. Don't forget that farmers are also interested in making money. So if you give them an opportunity to improve on their incomes, they would be glad to seize the opportunity. So once they get to see that, the next thing is we try to work with them - good, you can get that money but this is how to go. And then we say, well we'll provide training to help you to meet those objectives. And we had that training for farmers which we gave them on how to use market information to improve the prices they get for their product, and how to market their product. And the result we got from there was astonishing you know. Farmers were able to get prices 5-10% higher than they used to get in the previous time. Some of them even bought vehicles at the end of the season. So they were very, very amazed. Reynolds I can imagine some people saying, "You're not working on behalf of the farmers, you're working on behalf of the big companies.? Makinde It's a win win situation. Now the farmer has a lot to gain because he has an alternative market which will provide him with a higher income. That is really our target. That is what we are working for. Now the agro-industries are interested. Why? It is difficult for them to go to different producers because these farmers are producing in small, small quantities - hardly one ton, two ton. So working with farmer groups helps them to be able to get their supplies in one location and that is a lot easier for them. And then there is also the requirement that they should be able to trace back the supplies of their product. So working with us, through the farmers, help them to know the source of their materials that they are using. So it's a win-win situation. Many of them are also open because they're also concerned that the farmer should get a good share of the consumer naira which in normal times they don't get. Working with the farmers in this way, helping them bulk their product, helps to ensure that a large part of the consumer naira goes back to the farmers. So they are happy and the farmers are happy too. It's a win-win situation. Reynolds Now I can see this is a very satisfactory arrangement for the farmers and also, I assume, for IITA but how do IITA's donors view this tie up with the private sector? Makinde The project that we are working on is the Rural Sector Enhancement Programme and that project is funded by USAID. Now they have been very much fascinated by this because it provides opportunity to improve on farmers' wellbeing and that is basically what development work is about. We actually help farmers to create wealth. End of track