The consequences of the Russian invasion of Ukraine have enabled many countries to open up new export markets for their agricultural goods. However, smallholder farms have been largely left out. Drawing on his experience in India, our author gives a brief overview of how this can be changed.
Dr Niladri Sekhar Bagchi teaches economics at the University of Galgotias in India. His research areas include agricultural value chains for smallholder farmers, rural livelihoods and migration.
This article appeared first in Rural21 and is part of a media cooperation between Rural21 and foodfortransformation.org.
In the aftermath of the Covid-19 pandemic, the Russia-Ukraine war created a ripple of global supply shocks in agricultural and energy supply chains around the globe. While the disruptions in agricultural production in both Russia and Ukraine created shortages in the global supply of foodgrains, sanctions on Russian exports of energy and fertiliser pushed the prices of these critical inputs up to a record-breaking level. The food and nutrition security of the African and Middle Eastern countries deteriorated to a large extent as they depended heavily on food imports from these two warring nations. In contrast, South Asian countries such as Bangladesh, Sri Lanka, Pakistan and India faced the heat through higher prices of fertiliser and fuel. While India could somehow manage to bypass the sanctions on Russia and imported fuel from it at discounted rates, other countries of the Global South in this region were unable to enjoy this advantage. The increased fertiliser and fuel prices pushed up the cost of agricultural production in many of these countries.
This affected the smallholders (those having less than two hectares of land) in the countries of the Global South in many ways. They faced higher input and transaction costs. They also experienced high uncertainty in the export market as many countries, among them India and Indonesia, took recourse to export bans on their major agricultural crops, such as wheat and edible oil respectively. Smallholders in general are dominated and exploited by intermediaries at different strata of agricultural markets. The export opportunities created through the Russian invasion of Ukraine for many countries were most likely to be captured and exploited by the intermediaries and big traders. Among the major reasons why smallholders cannot gain much from the export opportunities is their strategic weakness in proper quality assessment infrastructure and an aggregative marketing platform such as a cooperative. It is frequently observed that the existing cooperatives in the countries of the Global South are not inclusive in their membership and governance, so that the interests of the smallholders are very often neglected.
Another important aspect where smallholders face huge challenges is their inability to use modern ICT tools such as smartphones and computers. Thus, the immense benefits of these modern ICT tools and their applications in agriculture remain out of reach for them. There are some remarkable instances of applications of ICT tools including different apps and web-enabled platforms in agriculture, ranging from crop choice and harvest quality assessment to marketing. However, these successful instances are mostly third party initiatives such as those run by NGOs or academia. Initiatives of this kind from smallholders are almost non-existent, the major reasons being their low education level, lack of regular training and a lack of links with the research institutions. Therefore, the pertinent question is how the market access or market relations of the smallholders can be strengthened so that they can really benefit from export opportunities arising out of a changing global market scenario and can be insulated from the global supply shocks like those observed in the aftermath of the Russia-Ukraine armed conflict.
First, smallholders must be brought under the membership of an allrounder cooperative or a farmer producer organisation.
The cooperative will act as a single window for accessing various benefits such as buying appropriate seeds, hiring machinery, getting loans and assessing the quality of their produce and introducing it on appropriate markets. This kind of cooperative is observed in Australia and other countries of the Global North. The prevailing cooperatives need to be upgraded into such a single window-providing institution for the smallholders. It has been noted that smallholders in countries of the Global South like India and Bangladesh are in many cases members of various collectives, such as water user associations, marketing associations and custom hiring centres, etc. Thus, they do not have single-window access to all the facilities, which could have considerably reduced their transaction costs and helped them connect to the profit-generating markets.
Second, the current structure of intermediaries needs to be regulated and upgraded to a multi-role agent system. In the existing system in India, it is observed that there are too many layers of intermediaries at different levels of markets – village, town, district and regional level, etc. These multiple layers of intermediaries add to the price of the final produce multiple times just for making coordination possible at different levels. They also function in favour of the buying intermediaries at the higher level and, ultimately, in favour of the traders only. Unless these intermediaries have some incentives to function in favour of the smallholders, the latter will always remain at the receiving end. The example of farmer-allied intermediaries in Africa can be used to formulate policies in this regard. There could be compulsory registration of all the intermediaries in the agricultural sectors, and the government could introduce an incentive structure for them so that they could help the smallholders in various ways in their capacities. For example, intermediaries are incentivised through government schemes to fulfil the objectives of food security in Indonesia. The compulsory registration may wipe out the redundant intermediaries and thereby reduce unnecessary price rises of agricultural produce.
Third, regular training for smallholder farmers in the application and use of modern information and communication technologies (ICTs) in agriculture and marketing in rural agricultural areas could be popularised in the rural agricultural areas.
Government-subsidised smartphones may be provided to the smallholders with dedicated apps for use in the agricultural sectors.
The farmer producer organisations and cooperatives may receive easy credit for creating robust ICT infrastructure and linking them with agricultural universities and other reputed academia so that modern ICT research and applications can be percolated to ground level without delay. In this way, smallholders would develop the confidence and capacity to be competitive in the world market.
Fourth, it is observed that the lack or total absence of quality assessment or certification facilities in most parts of rural India acts as a barrier for smallholders to connect with traders directly. There is a need for huge investments in quality assessment and certification of agricultural produce in the countries of the Global South. This is the most crucial facility that can connect the produce of the smallholders with any big traders or exporters without the need for physical inspection by an intermediary trusted by the distant trader. Both private and government investments are necessary to make certification and quality assessment widely available and affordable for smallholders.
The above four ways have the potential to make market relations and access of the smallholders strong and robust. Along with this, direct benefit transfer to the smallholders as seen in India can create a suitable buffer for absorbing a supply shock such as the rise in fertiliser prices in the world market because of the Ukraine-Russia war.
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How can we reach more people with successful approaches to food security? In Berlin, an international conference organized by the Deutsche Gesellschaft für Internationaler Zusammenarbeit (GIZ) addressed this issue.
Why are short- and long-term responses important to address current and future global crises? Sebastian Lesch, Head of the Agriculture Division at the German Federal Ministry for Economic Cooperation and Development (BMZ), provides answers to these and other questions in an interview with the Global Donor Platform for Rural Development (GDPRD) and explains how much Germany welcomes all donors pulling together and acting in concert.
How to maintain functioning food markets in global food supply chains in the face of vulnerability and disruption? Markets that support local and territorial food systems are part of the solution. Thomas Forster presents proposals for these markets to cope with future shocks.
The Global Alliance for Food Security (GAFS), jointly launched by the German G7 Presidency and the World Bank, released the Global Food and Nutrition Security Dashboard during COP27: A Rapid Response Tool for Coordinating Global Action for Food Security.
How can the challenges related to water, rural development and climate resilient agriculture be addressed? What innovations need to be promoted? The Water and Energy for Food (WE4F) initiative presents strategies and innovations for sustainable, integrated water management in German and international cooperation.
A Year of Multiple Crises: Russian war against Ukraine, extreme weather events, high prices for energy and fertilizer, food crisis had severe implications for food security and agriculture globally and especially in Sub-Saharan Africa. A Transformation of the food systems is needed.
Since early February 2022, two of the biggest grain and oilseed exporters have been at war. An overview, which countries are affected most severely by the destabilized grain markets, and what comes next.
Development cooperation needs to place good governance and a sustainable agri-food systems transformation at its center: After the first 100 days in office have passed, Dirk Meyer from the German Development Ministry (BMZ) spells out the goals, guidelines and priorities of the Ministry’s new lead.
Rising food and gas prices, physical destruction and supply chain disruptions: Why the Black Sea region matters and how the war in Ukraine affects global food security.
The Corona pandemic is hitting economies around the world very hard - but developments in African countries are quite diverse. There are different speeds, resiliences and vulnerabilities. What are the reasons for this? Apl. Prof. Jann Lay of the GIGA Institute provides answers.
A contribution by Prof. Dr. Anna-Katharina Hornidge
In the video format "#99SecondsWith" of the German Institute of Development and Sustainability (IDOS), Prof. Dr Anna - Katharina Hornidge talks about the new Africa-Strategy of the Federal Ministry for Economic Cooperation and Development (BMZ).
Four interviews kick off the relaunch under the new name „Food4Transformation“, asking the same questions from different perspectives. Mareike Haase and Stig Tanzmann from Brot für die Welt explain why the right to food, inclusivity, agroecology and food sovereignty are the central levers for a successful transformation.
Four interviews kick off the relaunch under the new name „Food4Transformation“, asking the same questions from different perspectives. Dr Julia Köhn, Chair of the German AgriFood Society, points out in the interview: Only if innovation and transformation are profitable in the medium term can they close the food gap in the long term.
The Federal Ministry for Economic Cooperation and Development (BMZ) has released a video on the transformation of agricultural and food systems. In the video, Federal Minister Svenja Schulze also speaks about the urgent need to combat global hunger and contribute to resilient agricultural and food systems.
Four interviews kick off the relaunch under the new name „Food4Transformation“, asking the same questions from different perspectives. Dirk Meyer, Federal Ministry for Economic Cooperation and Development, thinks: less individual solutions are needed, but more systemic approaches. Because in addition to the goals for food security, the issues of climate and biodiversity must also be taken into account.
A Contribution by Dr. Fatima Olanike Kareem and Dr. Olayinka Idowu Kareem
High agricultural prices affect developed and developing countries alike, but the problem is aggravated for the latter through the lack of or inadequate resilience measures. Dr. Fatima Olanike Kareem, AKADEMIYA2063, and Dr. Olayinka Idowu Kareem, University of Hohenheim, explain what can be done to mitigate the negative effects on food security.
A contribution by the Global Donor Platform for Rural Development
Two years following the UN Food Systems Summit, the Global Donor Platform for Rural Development and the Shamba Centre for Food & Climate hosted an official side event at the UNFSS+2. The event explored how public donors can increase the impact of their investments.
Iraq suffered many years of war, sanctions and economic crises. However, Ally-Raza Qureshi from the World Food Programme in Iraq sees progress. But now the effects of climate change are becoming apparent in the country. What is to be done?
The world is currently experiencing a historic food crisis. High fertiliser prices are part of the problem. In addition to the necessary short-term aid measures, the crisis ought to be made use of to develop and implement longer-term fertiliser strategies for sustainable, in particular smallholder increases in production in the Global South.
In a world facing crises – from pandemics, armed conflicts, and climate change – how do we ensure everyone has enough food within planetary boundaries? A new podcast by Food4Transformation discover solutions talking to government officials, scientists, NGOs and farmers around the world.
The Gaza Strip depends heavily on humanitarian aid, more than ever with the current war. Gaza population is very young: Half of them are children. What is their situation on the ground? Questions for Lucia Elmi, Unicef Special Representative to the State of Palestine.
In Sub-Saharan Africa, not all financial institutions (FIs) have access to knowledge about how to implement processes to enhance rural financial inclusion. The pan-African Community of Practice (CoP) plays a pivotal role in supporting these institutions along this transformative journey.
How can agriculture engage more young people in rural areas? Advocacy and education campaigns can play an important role here. Simeon Kambalame, Timveni Child and Youth Media Organisation, has launched such a campaign in Malawi.
Women and girls in poorer countries are affected in particular ways by the multiple crises the world is currently facing. Uncovering the linkages between gender, resilience and food security, experts from International Food Policy Research Institute (IFPRI) look at ways to support women and girls’ capacity to respond to crises.
The armed conflict between Israeli forces and the Hamas is escalating. What does this mean for a Gaza, region that was already heavily dependent on external aid? Questions for Dr. Muriel Asseburg, Senior Fellow at the German Institute for International and Security Affairs (SWP) in Berlin.
Chancellor Angela Merkel in the Podcast of the Federal Government
At the start of World Food Week around World Food Day on 16 October, Chancellor Angela Merkel stressed that the fight against global hunger will only be successful with international responsibility and solidarity (german only).
The Agriculture and Food Security Cluster of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in Zambia shows how synergies among different projects and partner organisations can help people to eat healthier, diversified food. A delegation of the Bonn based Division of Agriculture and Rural Development learned this in a field visit in the Eastern Province of the Southern African country.
Felix Phiri has been Head of the Department of Nutrition, HIV and AIDS at the Ministry of Health in Malawi for almost 20 years. A conversation about constants and change.
The guiding orientation framework developed by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) summarizes the requirements for the transformation of agriculture and food systems – and identifies principles and approaches for transformative change.
Every second, worldwide, we lose valuable and healthy soil with the size of four football fields. This was only one of the many facts being presented to a wide audience in Bonn and worldwide via livestream at the World Desertification and Drought Day on 17th June 2024. This was the 30th anniversary of the United Nations Convention on Combatting Desertification (UNCCD), which was celebrated at the Bundeskunsthalle in Bonn.
Diversifying our protein supply to include plant-based foods and cultivated meat can be a game-changer for climate mitigation and climate adaptation, especially in the countries of the Global South. However, a great deal of research is still required to capitalise on this potential. And political support, as Ivo Rzegotta, Good Food Institute, demonstrates.
In Himachal Pradesh, India, natural disasters are becoming more frequent and climatic conditions are changing – with negative consequences for apple production and farmers' livelihoods. Holistic and multidimensional innovation bundles are required for the entire value chain in order to make the food system more resilient in the future.
A Contribution by Emmanuel Atamba & Larissa Stiem-Bhatia
Drawing on dialogues with experts in Kenya, TMG Research releases its latest policy brief highlighting the critical need to strengthen coordination mechanisms in food systems governance. Emmanuel Atamba and Larissa Stiem-Bhatia from TMG Research summarize the results.
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