Let markets play their part in feeding the world

IFAD was one of the agencies invited to help shape the G8 New Alliance to ensure that 50 million people overcome poverty and hunger during the next decade, by focusing policy efforts and resources on smallholder agriculture.

Five things need to happen for initiatives like this to succeed:

1. Small farmers (men and women) need to be supported first and foremost. They are the primary investors in agriculture in Africa.

2. We need to help farmers work better with agribusiness (domestic and international), thus ensuring that the value chains become efficient and fair.

3. Investment is needed in more sustainable, resilient, climate smart agriculture, a message we'll be taking forward in Rio next week.

4. Governments need to ensure that private investment fosters food security and inclusive growth - through governance of natural resources and by developing inclusive business models and legislation.

5. Farmers need to organize, to engage with investors and government. This is critical for developing inclusive, pro-poor value chains and partnerships.

Carlos Sere, Chief Development Strategist, IFAD

I Very Much Support this initiative to Support Agriculture as its the Backbone of many Poor African Family Economies,Modernising it Shall Trully Lift many a Family out of Vicious Poverty Circle

One of the most difficult mind-sets to overcome in being open to approaches that involve NGOs and private sector players, is the tendency for many to latch on to "one-size-fits-all", grand strategies and master plans. This arises from a long history of such grand approaches - many of which have been found wanting - among centralized governments, multilateral finance institutions, and large bilateral aid agencies. It is becoming increasingly clear that success cases reflect context-specific economic factors and business feasibility for the players concerned. Indeed, business arrangements are as varied as the opportunities, the contexts, and the players.

Including livestock in plans for Africa's sustainable agricultural development is essential.

For increasing food production, or sustaining farming systems, increasing the incomes of the poor, developing new global bread baskets, making better use of dryland resources, conserving biodiversity, slowing climate change, helping people cope with climate change, or enhancing human health and nutrition, livestock issues are critical.

In Africa as the rest of the developing world, livestock are the fastest-growing part of agriculture. They’re a ‘demand-pull’ that can drive small-scale agricultural systems—the motor that brings in cash to smallholder mixed crop-and-livestock farmers. While cereals sustain the family, farm animals are the family’s source of cash— its living ‘asset base’.

Due to population growth and other drivers of change, many of Africa's livestock systems are transforming as fast as they are growing. We need to help the world’s poorer livestock keepers make better and more sustainable use of these big changes and new trends.

A new book on markets development for African smallholder farmers highlights a pioneering livestock insurance project as a key innovation that could enable African farmers reduce their losses in crop and livestock production.

A 2012 publication by the International Livestock Research Institute (ILRI) and the Alliance for a Green Revolution in Africa (AGRA), the book, 'Towards priority actions for market development for African farmers', calls for the ‘right mix’ of policy and investments to not only ‘strengthen African policy expertise’ but also encourage ‘a more diverse array of investments and initiatives, including those initiated by the private sector.’

One such initiative featured in the book brings together private- and public-sector actors to support an Index-Based Livestock Insurance project in Kenya.

Started in 2010 by ILRI in partnership with UAP insurance, Equity Bank, Cornell University and the Index Insurance Innovation Initiative program at the University of California at Davis, the Index-Based Livestock Insurance project provides livestock insurance against forage losses to over 2500 households in Kenya’s Marsabit District. Freely available satellite imagery is used to assess conditions of pastures. When pasture vegetation is reduced to a level below a specified threshold, the insurance company pays herders who bought insurance. Yearly premiums cost USD100 for 6-8 animals.

Pastoral livestock sectors are at the heart of agricultural markets in Africa. Kenya’s livestock industry, for example, is estimated to be worth about USD800 million per year and produces most of the meat consumed in the country and is critical to the country’s food security. Research by ILRI shows that long-term solutions to food security in Kenya and other countries in the Horn of Africa need to support livestock herding. Pastoral systems are critical for the survival of livelihoods here and offer the most efficient way of managing the region’s large arid and semi-arid lands.

This insurance scheme is currently being piloted in other parts of Kenya and in Ethiopia. In late 2011, 600 livestock keepers insured through the project received insurance payments for vegetation losses arising from the drought that struck the Horn that year. The project is also now making use of mobile phones to widen its impact in remote communities.

Notes:
The new book describes the outcomes of an international conference held in Nairobi three years ago that examined the ‘priority actions’ that if taken could speed up the development of African agricultural markets. Authors of the market's book recommend enhancing markets for poor people, improving market information, lowering transaction costs associated with trading and adding value to farm produce by upgrading value chains and processing mechanisms.

Read more about the book
http://www.ilri.org/ilrinews/index.php/archives/8786
http://marketopportunities.blogspot.com/2012/03/agra-and-ilri-publish-pr...

Download the full book or different sections:
http://mahider.ilri.org/handle/10568/16491

Read recent stories on the Index-Based Livestock Insurance Project from ILRI news:
http://www.ilri.org/ilrinews/index.php/archives/8149
http://www.ilri.org/ilrinews/index.php/archives/7348

View short films about the project
http://www.ilri.org/ilrinews/index.php/archives/7374

Indeed, forming cross-stakeholder alliances is a difficult adventure as mentioned in the text. However, bridging the gaps should works as an incentive, not a deterrent. It is not governments producing foods, but small, medium and large-sized food companies worldwide. Only the civil society can trigger hard-to-achieve changes in eating habits through social marketing; and only academia can offer independent data sets on the extents of hunger and malnutrition that governments can translate into effective policies. Working across sectors is not something nice to have faced by the challenge to feed 9 billion people in 2050 – it is the essential precondition if we want to deliver and reduce hunger and malnutrition.

The cross-stakeholder model partnership, German Development Cooperation (GDC) has on offer is SAFO: SAFO stands for the ‘Strategic Alliance for the Fortification of Oil and Other Staple Foods’ and is a develoPPP.de development partnership between BASF and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ). It runs from 2008 to 2012. SAFO has already achieved its agreed objective: More than 150 million poor and malnourished people in SAFO partner countries are now using edible oil fortified with vitamin A. When development cooperation and businesses join forces, their approaches are diverse. Companies seek new markets while development agencies want to improve life for the poorest. The thinking behind the SAFO alliance is to show that these aspirations are not mutually exclusive but can be complementary. For GIZ and BASF, food fortification is the right medium-term approach, complementing short-term food supplementation and long-term dietary diversification. Taken together, these three approaches are GDC’s three-pronged model for reducing malnutrition.

Potential private sector partners should read the economic case first developed by Professor C.K. Prahalad which shows the estimated 2.5 billion people who live on less than $2.50 a day not as victims of poverty, but rather as creative entrepreneurs and value-demanding consumers.

Rather than adopting a charitable approach or relegating activity to the realm of corporate social responsibility, the private sector should recognize the opportunity for delivering nutritious food to a huge and unique market. Approaches such as smaller packaging alone, would put products within reach of families earning small daily wages.

The private sector can do more than simply increase access to food. With its marketing power, it can create and fill a demand for access to nutrition – a critical piece of the hunger pie.

The whole chain of food production is ripe with opportunity - from crop breeding through to fortification of staple foods like flour, cooking oil and salt with vitamins and minerals.

As a global community, we must remain committed to delivering direct nutrition interventions to the very poorest and most vulnerable. Every one of the world’s governments needs to keep its sights set on this segment of the population. But greater private sector attention to the vast, currently under-reached market at the bottom of the pyramid would help aid efforts to finally reach those in the very greatest need.

Venkatesh Mannar

President, Micronutrient Initiative

The nature of partnerships, whoever they are with, is about matching incentives and objectives. Every NGO, agency, and private sector company has a set of objectives they are trying to fulfill whether that be humanitarian or profit results. So the secret is to find ways that both sides benefit and to look for the connections. The objectives are often not so far apart. The development community wants to lift people out of poverty, enable them to stand on their own two feet without handouts. The private sector actually wants this too - when the poor can stand on their own two feet, and have more disposable income, they are both the producers and customers the private sector is looking for! Plus we often seem to forget all farmers, including smallholders, who sell any level of produce are the private sector.

At WFP, when we started to receive more of our resources in cash rather than food, it was clear to us that purchasing where we could - keeping in mind that we need to remain cost-efficient - in the developing world would benefit developing country agriculture and farmers. As we did this we realized that given the magnitude of our purchases, poor smallholder farmers in developing countries could not access our supply chain.

So we looked at why smallholder farmers could not access the supply chain, which came down to size of production, quality of production, and basic business skills in terms of tendering and contracting. So Purchase for Progress (P4P) was borne – a pilot initiative that builds the capacity of smallholder farmers to access the supply chains in their countries. Working with other implementation partners, such as FAO, we build their farming capacity – productivity and quality, we help them explore models whereby groups of farmers aggregate their production, we contract with them to buy their production in the first instance so they become familiar with a formal buyer. The goal is to support farmers’ organisations and help farmers to become savvy businesswomen and men who are not only able to sell to WFP, but are knowledgeable and successful private sector players in their countries.

Core funding for P4P has come from the 'private' sector with both the Howard G. Buffet Foundation and the Gates Foundation providing sizeable funding, alongside traditional donor governments to WFP. Private sector players including supermarket chains and breweries are starting to source from smallholders in the wake of P4P, and financial institutions increasingly enable access to credit for farmers’ organisations when they have a contract to sell to WFP.

WFP has many private sector partnerships that range from the pro bono service and capacity provision to our operations to what one could term active participation as the private sector in our operations. One example is where we give vouchers that enable people to go to a retail outlet to obtain more diverse food products than we are able to supply in a 'food aid' basket due to shelf live and perishability issues. In the occupied Palestinian territory we give vouchers, which enable people to buy dairy products and eggs, supporting demand for these commodities produced by local farmers, as well as having a positive impact on the other actors in the supply chain (processors, transporters, wholesalers and retailers).

If we fail to integrate the private sector into the work we do, or to connect the people we work with to the private sector as both employees, producers and consumers the pathway out of poverty will be much longer for many people.

I embrace any sector that works towards healthy, just, sustainable systems to provide humans with the nutrition, water, shelter, medicines and other things we need while caring for our earth.

The problem is that all to many in the private sector, government leadership and donors/aid/development are poisoning the earth with chemicals (e.g. in products, in agriculture and food systems, for 'pest' controls), genetic manipulation (e.g. hybrids, genetic engineering) and systems that are unbalanced and unfair.

This partnership described by the USA to support several of the biggest offenders taking us in the wrong direction. We need to partner with people who will help take us in the right direction to achieve food and nutrition security.

Choose organizations that support healthy systems, such as Permaculture, which designs sustainable systems for all human needs while caring for the earth, its people and sharing resources fairly. www.NeverEndingFood.org

The concept of ‘conservation’ gets immediately linked to natural resources and biodiversity. Oddly enough, we don’t put the same emphasis on conserving the very output of those natural resources, the harvests. With 30-40 percent of food being lost postharvest (depending on the perishability of the food, the country at stake and the nature of the supply chain), we should also focus our attention on postharvest losses as we talk about food security.

Well-established and responsible private-public partnerships can help integrate the various links in the supply chain, tending to minimize postharvest losses. A strategic combination of players that: a- devise locally-relevant production and postharvest systems (public organizations and academia), b- accelerate adoption (local communities, funding, public and private organizations) and c- insure adequate food transportation (public and funding organizations) is an essential piece of the food security puzzle.

The contributors are very learned people, so I feel a tad bit intimidated giving my opinion. My opinion regards the role of the youth in solving world hunger.

You see, most initiatives target farmers who own the land. This is not wrong, per say. They own the land (most important resource) and therefore make the most logical targets. However, the profile of these farmers is mostly an ageing population which will in a few years time be put out of the business altogether due to inevitable ageing. For sustainability that is beyond a few years, I think more aggressive measures to involve African youth should be highlighted. Africa, and most other hunger stricken areas, have large populations of youth who flood the urban areas in search of work. This high urban migration pattern leaves an ageing population in the farming areas who are initiated into such beneficial programs.

To be effective in the long-run, the youth need to be the ones benefiting from such programs. I think that if Africa finds a way to be able to attract able bodied youth to agriculture then we will be very close to solving world hunger. Youth are faster learners, can more readily accept new technologies, are open to new ideas and would be able to put in more physical labor as needed.

That said, they need to be attracted to the idea of farming in the first place. Therein lies the challenge. The youth would much rather linger jobless in urban areas than perform farming duties back in the village.

I may not have stated my ideas as coherently as the posts above, but I hope you get the idea.