Connecting Farmers to Markets Through Ethical Partners

Smallholder farmers, estimated to number some 500 million, are often disconnected from formal and export food markets. But new opportunities for linking retailers in Europe and the US with producers in Africa are emerging.

Some of the barriers smallholder farmers face in making these connections, as discussed in a new paper authored by Abbi Buxton and Bill Vorley of the International Institute for Environment and Development, include the high standard of products retailers require, timely delivery of products, and certification.

The paper discusses a four year project, which investigated new business models to address these barriers. The project was in collaboration with the Sustainable Food Laboratory, Catholic Relief Services, Rainforest Alliance and The International Center for Tropical Agriculture (CIAT) and was funded by the Bill & Melinda Gates Foundation. The project examined four different value chains, this paper, the first in a series of four, looked at flowers in Kenya.

In particular the paper discusses the important role intermediary organisations can play in linking smallholder farmers with retailers both in terms of supplying smallholders with the inputs and markets they need to increase production and ensuring a high quality and guaranteed supply to retailers. For this case study the intermediary company was Wilmar Agro Limited, based in Thika, Kenya who has some 2,000 contracted smallholder farmers supplying flowers, which Wilmar sells in Europe. Throughout the course of the project Wilmar was connected with Asda in the UK and Sam’s Club in the US and the way in which the terms of trade between these parties and the smallholder farmers contracted by Wilmar could be established to bring benefits to all actors in the value chain was investigated.

As discussed in Chapter 8, aggregators or intermediaries such as contract farming organisations, cooperatives or farmer associations are offering more and more opportunities for smallholders to capture the benefits arising from value chains, while minimising the risks.