Ensuring Informed and Empowered Participation in

1
Ensuring Informed and Empowered Participation in
Markets for the Small Producers
2
All producers participate in markets in some
manner. Smallholders in traditional, developing
economies are weak participants in markets. This
participation is characterized by

• High transactions costs
• High price risks
• Monopolistic/oligopolistic conditions
• Significant risks of realizing payments

3
Participation can be improved if small holders
have access to

• Information to product demand, seasonality,
  product features
• Reliable and affordable credit for financing
  stocks and working capital
• Logistics of weighment, grading,storage and
  transport
• Assurances for covering their survival costs to
  be able to take risks of new crops/markets

4
Attributes which influence the demands on the
quality of the above access are

• Diversity in product type
• Homogeniety in the product
• Need for identity preservation
• Need for traceability
• Determinants of price discovery
• Fragmentation
• Transaction velocity
• Non-value adding transactions costs

5
Improvement of market access and hence of
participation quality will require information
on

• Locating markets
• Identifying market intermediaries and players
• Current market institutions and its practices and
  procedures
• Availability of safeguards from monopolists
• Evolving ways of reducing and managing
  transactions costs
• Price discovery
• Demand trends

6
Strengthening and fine tuning of production base
of small holders will involve

• Identifying the right technology
• Localizing and adapting the technology to small
  holder needs and
• resource conditions
• Evolving package of practices appropriate to
  small holders
• Scaling down the technology in sizes appropriate
  to small holders
• Hand holding in initial stages of production and
  post-harvest practices

7
What do the existing players do? A. Market
Linkage field
Attribhute Corporate NGO Co-ops Producer groups Individual service providers Remarks
Primary motivation Market share, profits livelihoods Improving producer share in value Individual gain through collective efforts Own livelihoods
Market links Some times weak Strong links yes No
price discovery yes no yes no No
Logistics yes partially SOS SOS No
Diversity and homogeneity management seldom no no no Yes
Identity preservation yes no no Need does not arise Yes
8
What do existing players do? B About improving
production and post harvest
Attribute corporate ngo Co-ops Producer groups Individual service providers Remarks
Agronomy extension yes Yes uncommon informally yes
Adaptive RD no Some times no yes Seldom
Training rarely Yes Some times no Yes, of a practical type
Problem solving no No no yes Yes
Sourcing technology and materials Yes, but at a large scale Yes no yes Yes
Credit no Yes yes no No
Aggregation yes Yes yes yes No
Risk absorption and mitigation rarely Yes yes no No
9
The most hurtful gaps

• Production and post harvest side
• Adaptive RD
• Problem solving during production
• Sourcing technology of the right scale and cost
• Risk mitigation
• Market side
• Generating value using heterogeneity, diversity,
  preserved identity
• and traceability
• Costless price discovery
• Quality preserving logistics