Project Funding and Organization

GROWING FOR EXPORT

By Albert Makendenge

Although some of the Zimbabwean smallholder farmers, who only have access to a few acres of land can meet local demand, it is often debated whether they can do so viably for the African, European and American export market which normally requires huge quantities over prolonged periods. Added to this challenge of quantities is limited access to road and communication infrastructure that mainly comes from being geographically dispersed in the rural areas and this limits the participation of local smallholder farmers on the export market. However this does not render the high-paying option of exporting (currently headlined by horticultural crops such as peas and beans) impossible and the answer simply lies in the synergistic advantages of consolidation.

The performance of the agricultural sector on international markets is deeply rooted in the ability to consolidate input resources and aggregate farmers’ products from different production zones. The export market is a game of right volumes to attract buyers and meet demand. Therefore concerted efforts must be made to mainstream group cohesion and embark on aggregation as way for these farmers to tap in to these lucrative destinations. Consolidation, which ensures bulking of products into sizeable volumes that can be readily and economically transported, sorted, processed and stored by processers, wholesalers, exporters and retailers, comes with two great benefits of economies of scale along the value chain and bargaining power.

Economies of scale arising simply form the fact that as the scale of production increases through working together, production costs decrease. Although aggregation comes with several cost saving opportunities such as transport logistics, improved quality, marketing, capacity building, information dissemination and increased volumes; one of the most important issue farmers will still have to deal with is that of producing a homogenous product with the same color, taste, size and weight. Once a homogenous product has been achieved, selling is easy especially with the greater bargaining power that comes with higher volumes as a result of aggregation.

Collective action gives farmers bargaining power to secure competitive prices. Aggregation also stimulates significant income increases for smallholder farmers by providing demand-driven services which in turn facilitates increased productivity.

Although the advantages of consolidation are many, the obvious drawback that is noted by many is that of non-performing partners. Going forward, there is urgent need for smallholder farmers in Zimbabwe to come together as common groups and find best models that will turn their numbers into sustainable businesses. Actors across the entire agricultural value chain, including governments, donors, businesses, scientists and development practitioners should work together to support farmers in creating an enabling environment with appropriately and responsibly designed support systems and linkages that ensure growth and survival. Despite having its own risks and obstacles, support in terms of quality inputs, extension services and enterprise training and facilitating their organization into co-operatives for easier access to credit and increased capacity to meet bulk orders can be one sure way to high value returns for the smallholder famers who already dominate the world’s food production systems.

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