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Area 2: Building Capacity through Development of Smallholder Producers' Organizations








Questions for Discussion by all Breakout Groups

Where are we?   Examining Partnership Progress and Lessons in Four Key Areas: Integrating Food Aid, Food Security and Nutrition Programs; Building Effective Producer Organizations; Public-Private Partnerships; and Higher Education, Research, and Training  
Discussion questions for all breakout groups:  
(1)  Where are we? What are we learning from our actions to date? Where have we made progress in putting together partnerships for action?  
(2) What are the main constraints to greater effectiveness and scaling up impacts in this area?   
How Can We Do Better? What Do We Need to Do Next to Get Down to Business and Scale up Agricultural Development in Africa?  
Discussion questions for all breakout groups:  
(3) What are specific recommendations for action by all partners (national and regional CAADP/FTF programs and their partners in the donor, university, research, private sector, and NGO communities) that would increase impact, especially through scaling up successful efforts?  
(4) What are specific recommendations that would improve how country and regional CAADP/FTF programs and their partners could better “learn while doing”? 

Partnership Area 2 Overview

Building capacity through development of smallholder producers’ organizations
There is wide consensus that smallholder farmers will be more successful in responding to growing market demands if they work together, perhaps pooling their investment capital for infrastructure of benefit to all, or perhaps simply sharing information or developing skills through group training to make each of them more competitive. Working in organized groups – whether called farmer associations, producer organizations, trade associations or cooperatives; whether formally registered or unregistered – has been identified in Pillar 2 of the Comprehensive Africa Agriculture Development Program (CAADP) as key to improving smallholders’ market access and improving their terms of trade.  
The checkered legacy of state-mandated and state-run farmers’ organizations in many African countries, however, has hampered the growth of successful farmers’ associations attuned to the emerging environment of market-oriented and competitive agricultural enterprises. With greater emphasis on organizing development efforts along value chains, however, there is also a new opportunity to rebuild the organizational capital that farmers’ associations can provide and to enable farmers to take charge of their own business opportunities.
Farmers who have the opportunity and ability to participate in functioning organizations that provide them access to ideas, information, and services will also have better access to markets, i.e., be better able to “get down to business.” These organizations can help them to succeed, both increasing their output and incomes but also enabling them to manage their risks successfully.   Many market-development and community-based development programs have had significant experience with the development of farmers’ organizations. What have been the lessons learned to date? 
Several have been suggested:
Many observers note the need for greater attention to the enabling environment for member-based organizations: better law and regulation. First, does the enabling law determine the specific character of the organization – farmer association, producer organization, or cooperative – and does that matter? Second, do laws and regulations actually provide the framework needed for these organizations to succeed economically? Laws in some countries, for example, prohibit a not-for-profit organization from entering into any kind of commercial transaction, posing clear problems for farmers’ organizations providing marketing functions to their members – both selling products or aggregating purchases of inputs or services on behalf of all members. Other market-related issues also need to be addressed, for example, offering member-organizations recourse when they have been unfairly exploited by traders, unscrupulous suppliers, or even from management staff in their own organization.
In the past, registration requirements and government-imposed structural requirements have promoted government interference and intervention. To what extent do these requirements remain in place? What can be done to overcome them? Are there examples of positive and negative regulatory environments that can shed some light on what governments should andn should not do? What lessons, for example, does the CLARITY initiative undertaken by the participants in the Cooperative Development Program hold?
What about the issues of institutional governance and professional, transparent management of the producers’ organizations? Is this as important as the legal and regulatory environment? Or can a positive legal and regulatory environment, by establishing clear guidelines for safeguarding minority shareholder rights, for example, play a supportive role in the institutional success of producers’ organizations?   What contributes most to the “professionalization” of farmers’ organizations, that is, enabling them to provide services for members, be credible business partners for banks, traders, processors and other private sector actors along the value chain, and to “carry weight” in transasctions undertaken on behalf of members? How can the human resources essential for effective organizational functioning be mobilized?
A key driver for many programs focused on cooperative development and the establishment of farmers’ associations is market development – specifically, providing opportunities for smallholders to participate in growing markets. We have some good examples of farmers’ organizations that have enabled smallholder-members to enter into markets that they would otherwise not have linked into and to take advantage of increased margins by carrying out post-farmgate functions in the value chain: segregating output by grade, processing, or storing. Are these positive experiences more broadly replicable? How much external support in the form of training, supervision, and market skills development is necessary?
Does farmer organization or cooperative financing pose specific problems or opportunities?   Does the government (through law, regulation, or other program support) have a role to play in making financial services available to organizations? Does, for example, formal registration of a cooperative or farmers’ association make a difference when it comes to accessing financing? Are rules regarding collateral appropriate to the financing needs and capabilities of farmers’ organizations? 
It is often said that farmers’ organizations function best when they are local, democratic, and build upon strong community ties. But are there opportunities to look at cooperation among farmers’ organizations and associations as a way of strengthening local organizations and building their success? Is the experience with the current associations and apex organizations instructive in this regard?   The specialty coffee associations and transnational Grain Council of eastern Africa, the national farmers’ organizations in Kenya and Uganda, and the experience of NASFAM in Malawi may all hold some lessons in this area. What about building cooperative-to-cooperative joint ventures, for example? Are there different challenges for farmers’ organizations/trade associations dealing with staple crops, high-value crops, or commodities that need to be processed in relatively capital-intensive facilities (sugar, cotton, etc.)? 


(1)    Where are we? What are we learning from our actions to develop farmers associations (producer organizations, cooperatives) to date?   Have we really “linked farmers to markets” through this mechanism? Where have we made progress in putting together partnerships for action?
(2)   What are the main constraints to greater effectiveness in building successful, profitable, and sustainable farmer organizations? What prevents scaling up associations’ memberships and activities and getting greater impacts, such as better incomes for association members; expanded market opportunities; or broader participation, especially of women farmers? 
Some possible questions for discussion:
•        How widely shared is the view that farmer associations/cooperatives/organizations present important opportunities and benefits for farmers? Does the organizational form make a difference? What functions do they best fulfill? What percentage of African smallholder farmers are members of registered farmers’ organizations? 
        Membership: What do farmer-members now perceive to be the advantages and disadvantages of their membership in farmer associations? What are the main constraints to expansion of membership in farmers’ organizations? Do all members find they have equal access to information and other association services– or are there gender barriers, size barriers, etc.?
        Farmer associations and marketing: Under what conditions do farmers’ organizations increase members’ access to and success in markets? Do some value chains (more perishable commodities, more inelastic markets) provide more benefits to members of farmers’ organizations than others?   How do association activities affect market success: bulking, grading, quality improvements, processing equipment, storage? Are associations better able to negotiate stable and good prices?   Should strategic plans for expanding farmers’ organizations target specific areas, commodities, value chains, or market conditions?
        Extension services and access to services. Does membership in a farmers’ organization facilitate access to useful information about production, marketing, processing, grading, etc.? Can organizations move further into the value chain, actually providing some of the services (storing, grading, processing) and capturing that value added? How are extension services oriented to farmers’ organizations and their commercial as well as production goals? 
        Are single-commodity farmers’ associations more likely to develop farmers’ productivity through more expert knowledge-sharing and/or greater depth of information about markets than multi-commodity farmers’ associations?
        Policies and Governance. Which governments are providing a strong enabling environment for farmer organizational development? What are examples of African governments that have clear policies and regulations regarding farmers’ associations and cooperatives? How many blend economic and social objectives? Are principles of corporate governance included (protection of shareholder rights, accountability of leadership, etc.)?   How helpful are association/cooperative registration processes? Do they enable associations to enter into contracts or borrow funding more easily? Do they provide access to useful training opportunities? Do public training institutions support cooperative/association development? To what extent are farmers’ associations activities subject to state controls and participation?
        Formal vs. informal. NGOs that work at the community level or in the development of value chains often find it useful to organize farmers into associations or other groups. How many of these groups actually become registered farmers’ associations? How many become members of larger apex organizations? How consistent are the approaches to organization and training that are used by the various NGOs and others working on including smallholders in value chains.
(3)   What are specific recommendations for action by all partners (national and regional CAADP/FTF programs and their partners in the donor, university, research, private sector, and NGO communities) that would increase impact, especially through scaling up successful efforts?
(4)   What are specific recommendations that would improve how country and regional CAADP/FTF programs and their partners could better “learn while doing”?
Some possible questions for discussion:
        What needs to be done to ensure that African governments have clear policies and regulations regarding farmers’ associations and cooperatives? Are principles of corporate governance included (protection of shareholder rights, accountability of leadership, etc.)? 
        Involvement of the education/training system. How could African education institutions play a stronger role in providing training and education for farmer organizations and cooperatives? Would a non-formal TOT approach with the extension system – rather than an education institution-based approach -- be more effective in scaling up associations in the short-term?
        Should African countries look to medium- and large-scale agribusinesses to help associations of smallholders come into the markets? Are agribusinesses playing an active role in implementing CAADP and FTF goals for smallholders? Do market guarantees provided by agribusiness buyers (and maybe supplier credit) boost the chances for farmer organization success? 
        What mechanisms might be made available to enable farmers to join forces as a single agribusiness controlling a segment (or all) of the value-chain rather than a loosely-affiliated association?
        How might better organization of markets (establishment of grades and standards, licensing of traders, warehouse receipt systems, commodity exchanges) help producers’ groups and vice-versa: how can producers’ groups help organize markets? What should CAADP- and FTF-related programs do to foster better linkages between producer organizations and markets?
        What approaches are most effective in developing the “organizational capital” of African farmers’ associations and enabling them to sustain operations and grow over time? And how can these successful approaches be replicated? What needs to be done? What are the key areas for action that could be led through NEPAD/CAADP/REC processes?
        What should NGOs do differently to scale up and sustain the development of producer/farmer organizations? Should NGOs be promoting more formal (registered) organizations that are part of larger apex organizations? Many NGOs have manuals for providing training to associations/cooperatives with whom they work. Few NGOs seem to collaborate with each other or with established colleges and universities providing training opportunities that could be useful for association/cooperative development. What kinds of collaboration opportunities might be pursued to build more permanent local training capacity and help to bring association development to scale?