Big farmers should not come and break bulk in Mbare and other informal markets but should create their own markets which suit their scale and levels of production.
Charles Dhewa
There is no longer any doubt that Zimbabwean agriculture has changed over the past decade. However, such a transition has not been supported by mechanisms for sustaining the flow of good ideas. If we are going to use agriculture in lifting ourselves up, more evidence-informed approaches are needed.
Rather than continue to follow incentives, value chain actors have to explore diverse ways of making a difference. Formalisation will not completely replace informal markets and networks. Actors have to learn to compete in markets where processes are sometimes more transparent and obvious. This is going to be difficult for those who have survived on information asymmetry.
The power of characterising farmers and value chain actors Organised agriculture can only be achieved if we characterise and cluster farmers and other value chain actors in line with the new economy. That is how we can see growth patterns among different classes of farmers. For instance, at the moment it is not clear what defines boundaries between farmer unions because you can find almost all farmers in one union, irrespective of resources, skills, experience and resources. Is there a common purpose among farmers?
To what extent is membership to a farmer union driven by incentives like free inputs, physical structures like farm size, land, water or intangible assets like knowledge, skills and experiences? Is there a graduation process from one union to the other, for example from Zimbabwe Farmers Union to Zimbabwe Commercial Farmers Union?
Is there an appropriate ladder or scaffolding? How do we define a commercial farmer? Is it land size or knowledge? If you have 1 000 hectares or 500 cattle but lack knowledge, are you a commercial farmer?
The fragmentation of farmer unions hampers effective resource allocation and utilisation. Ideally, farmers should be characterised based on various factors. For instance, what knowledge, skills and experiences are in Honde valley and which farmer union can better meet the needs of Honde Valley? We can then see how the farmers graduate into higher levels.
A one-size-fits-all classification is not helpful because farmer unions may not have all the structures. Another issue to be clarified is the role of NGOs and contracting companies. Currently there is too much duplication in service provision efforts.
A model for characterising value chain actors
As we gear up for more investment into the agriculture sector, there is need for a model that informs farmer characterisation in terms of knowledge, skills, experiences, location, natural resources availability, age, gender, etc. This should contribute to the development of supporting structures.
The need for a farmer union that focus on women should be informed by evidence, same with the need for a union for youth. Otherwise, we cause unnecessary fragmentation. Categorising all types and classes of farmers (A1, A2, semi-commercial, etc,) should be based on knowledge, skills and experience.
Before the land reform, smallholder farmers mainly used their own knowledge for wealth creation. Following land reform, many potential farmers joined farmer unions without having gone through the necessary capacity building that would ensure they acquire requisite knowledge, skills and experiences.
For instance, many politicians have become commercial farmers overnight after becoming land owners. By using land size or land ownership as a major criteria, we end up over-estimating our potential. We need to answer questions such as; from more than 5 000 new farmers who have benefited under land reform, how many have relevant knowledge, skills, attitude, emotional intelligence, patience and experiences? Determining such issues is a very important undertaking as we strive to revive our economy through agriculture.
How the market can assist in characterising value chain actors
The market has a more granular and nuanced way of characterising or defining farmers and other value chain actors. The same way members qualify for loans should be the way members qualify for particular memberships into farmer unions because capacity to pay has a bearing on access to services and fulfilment of needs.
There should be a scoring mechanism through which members can be clustered. Unlike the prevailing situation, good farmers should have more voting rights than novice farmers. That will prevent a clash of interests.
How can you organise production when members don’t have knowledge and the right attitude? At the moment, members’ decisions to join unions are driven by incentives. Instead, farmers should not be influenced by incentives but by their capacity and willingness to share knowledge, skills and experiences.
This will ensure knowledge becomes a public good from which many actors benefit without diminishing their capacity to deliver. When farmers and other actors share plans and projections, they are able to organise their production in ways that meet specific needs of different markets. Another critical question is, what is the entry point for participating in export markets?
Experiences should be carefully consolidated in order to answer this question. There should be a way of clustering farmers into those with an export orientation and those focusing on food security.
Besides simplifying resource allocation, this will prevent double dipping.
Commercial agriculture was previously driven by availability of inputs, irrigation, water, good road network and other critical drivers. Likewise, going forward, all people who practice commercial agriculture should have similar characteristics, mindset and other shared characteristics.
For a food security strategy, do we have a boundary of actors who meet our nutritional needs? We need to identify farmers who can focus exclusively on nutrition and organic production consistently. On the other hand, the requirements of processors can provide more useful criteria. For example, clear standards and specifications from processors become a farmer characterisation criteria since it compels processors to work with farmers who meet their standards.
The role of intermediaries in market-driven characterisation Rather than characterising members according to belonging to a commodity association, farmers’ unions should classify their members in line with the market. For that to be successful, there is need for independent intermediaries who can rationalise all characteristics. An independent player can continuously collect data through longitudinal studies which assist in consolidating production and markets on a continuous basis.
Haphazard production is often extended to the market since markets also end up not being properly structured. We can’t continue to see large farmers bringing their commodities to Mbare where they compete with smallholders and women farmers from Buhera, Mutoko and other areas. This creates economic injustice. If someone with 1 000 cattle comes to the same market where a farmer with two cattle comes to sell, the playing field becomes skewed to the advantage of a farmer with more cattle who can survive due to economies of scale. Big farmers should not come and break bulk in Mbare and other informal markets.
They should have their own markets like wholesalers from where traders and small markets can come and buy. When they decide to play with small boys there is no price for guessing who wins and who loses.
Significance of market infrastructure development
There is still over-dependence on the fiscus in our agricultural sector. With proper characterisation of production processes and actors, we can nudge financial institutions to build market infrastructure and other facilities that smoothen the marketing of agricultural commodities.
At the moment, informal markets are considered public entities where big players are not interested to invest but ride on the fiscus. Big farmers and agricultural enterprises like ARDA should create their own markets which suit their scale and levels of production. As a common like grazing land, market infrastructure should be developed and preserved.
Financing becomes easy if there are well-defined boundaries and structures informed by knowledge, skills and experiences as well as capacity. Not every farmer requires $500 to start farming. Others need $10 000 while others do not even need a loan if they are assisted to unlock resources they already have.
For instance, a farmer with 20 head of cattle may not need a loan. First class farmers should have knowledge at their level while those at different levels of transition within farmer unions should receive what they need, not what they want. Ultimately that will demonstrate a growth path for each farmer in ways that inspire needs-driven service provision.
That is where ICTs can be cleverly harnessed towards characterising and consolidating information about farmers with similar qualities in Chipinge, Gwanda, Mhangura, Nkayi, Gokwe, Mutoko and others areas in building a nutrition basket. Currently it is difficult for these farmers to know each other and organise themselves. It’s like expecting fish from different ponds and dams to know each other and cultivate sustainable relationships.
A transitional process is critical. Development players should subsidise knowledge generation in communities they work with so that smallholder farmers can be seen to be graduating from subsistence to commercial levels. How can we move smallholder farmers who have been working with NGOs to start working with the private sector?
This is where knowledge brokers are important. If farmers are not exposed to competition, they won’t be able to improve their products. When farmer unions define and characterise themselves properly through the market and other nuanced ways, it becomes easy for them to convince financial institutions and investors. They should not wait to be characterised by financial institutions using criteria, which misses some of the critical resilience features.
Collateral should be based on knowledge, skills, cohesiveness and markets. All these intangible parameters are currently barely understood by financial institutions. To what extent can a farmer union support its members to access loans when land holding is a criteria for membership instead of considering knowledge and entrepreneurial skills which drives agribusiness? Accurately answering this question should unpack the boundaries for each category of value chain actors.
At the moment, most farmer unions depend on subscription-driven membership which does not consider a needs-based package that takes into account knowledge, skills and experience. A payment system becomes functional when farmers and all value chain actors are properly characterised and aligned with appropriate resources.
Charles Dhewa is a proactive knowledge management specialist and chief executive officer of Knowledge Transfer Africa (Pvt) (www.knowledgetransafrica.com) whose flagship eMKambo (www.emkambo.co.zw) has a presence in more than 20 agricultural markets in Zimbabwe. He can be contacted on: [email protected]; Mobile: +263 774 430 309 / 772 137 717/ 712 737 430.