Agriculture is, to many African countries, the wealth formation vehicle for rural communities and a direct source of food as well. A lot of focus has been provided for productive agriculture with little focus being on the entire agricultural value chain.
The agricultural fraternity needs to change the agricultural exploits to focus more on value chain linked practices that scale from pre-production to the consumption, integrating the services that accompany the pre-production as well as the productive activities shown in Figure 1 that comprise inputs, production, storage/aggregation, transport, processing, packaging and branding, distribution/retailing and consumption. With service orientation perspective these services can be formed to become farmer owned agribusinesses which can and are presented here as an interesting paradigm for driving grassroots wealth creation.
The discussion presented here is drawn from experience derived from the collaborative work undertaken with the University of Nairobi, Kenya Forestry Research Institute (KEFRI), CIAT/TSBF and KARI. It demonstrates a sector that is too research-farmer based with little focus on wealth creation for the farmer. No doubt the agricultural value chain is mainly driven by agricultural researchers whose main output has traditionally been in published new research findings in the given area of focus. The reseachers' focus on value chain therefore ends with their critical deliverable, which in this case is the research paper. Some researchers who specialize in agribusiness face similar challenges to what the farmer faces in understanding production. The agribusiness reseachers at times suffer lack an in-depth appreciation of businesses modeling which is the vehicle for wealth creation.
The practice is that the wealth creation perspective in agriculture is left with the extension workers, who in-like manner are challenged in the clear diffusion of the technology, since they may lack an understanding of farmer based organizational models that they are expected to help farmers adopt. This then means that the potential for creating earnings from consumer-payments derived from their farm produce procurement is limited.
The challenge in this scenario has been that the farmer puts in so much effort to produce some commodity that rarely makes enough to persuade the farmer stick with a particular agricultural value chain engagement.
The foregoing statement is demonstrated in Figure 2 (a research outcome of the author’s work) that shows that out of the aggregated earnings of Ksh. 96 per litre of milk paid for by a consumer, the farmer’s reward is only Ksh 29 or about 30% of the price. With such paltry net earnings of Ksh 12 (13%) from the market, the potential for farmer fatigue; when they know the price that their litre of processed milk fetches is high. This then explains the reason smallholder farmers are always on a migration path to seek new areas of investing their productive time, hoping as they do that the next value chain engagement provides better earnings.
A candid assessment of the agricultural value chain exposes the reality of what happens in the agricultural value chain: that the farmers the only parties who engage with the value chain, and end satisfied with the role they play in the engagement, are researchers, produce brokers, and processors.
The challenge with farmers is that a majority of them never get to really master much on what their role as value chain actors is supposed to be, as they are driven to undertake production by the knowledge of the brokers who control the consumer-farmer backward linkage. Unfortunately, the brokers, who thrive on market information asymmetry, also happen to be the main source of information that the extensionists (who advise the researcher) relies on.
In a time when technology is changing so much of what happens in the continuum of the agricultural value chain, there is need to change the interaction of the value chain layers above research outputs. Focus should be more in creating a new model to extension and market linkage, so that research can have an impact to the producers that the farmers are, as well as infuse an understanding of business models to extension that advises the smallholder farmer. Furthermore, if the farmers were to engage in their individual or collective capacity with the market, they would have better control of the interaction with the consumers. Such a model would superimpose an organizational framework that brings farmers to an organizational vehicle that they form to aggregate their produce, provide production and market information, and deliver payments from the market for the aggregated produce, thereby supporting financiing to the value chain activities.
If this were to be achieved, farmer loyalty in their value chain of focus would continually be rejuvenated as they practice a rewarded engagement with agriculture. The Aquaculture, Value Addition, Agribusiness and Knowledge (AVAAK) Centre model seeks to address this gap by ensuring that agriculture, which has been touted as the solution to growing national incomes, achieves that goal. Figure 3 represents the AVAAK Centre model that superimposes the business and organizational thinking to the agricultural value chain.
Using this model, the practice of agriculture to support preproduction activities associated with specific research efforts, farm level inputs, soil fertility and related management will shift the knowledge-based investments of research and agricultural technology support to reach the producers through an organizational vehicle that is close to the farmer and which the researchers or value chain knowledge providers can reach.
Should the traditional extension vehicle be found necessary for the purpose of feedback and feed-forward in the chain, particularly to provide insights to the policy institutions, then they too will have a locational space to interact with producers or their representatives in a physical space. Such a possibility ensures that the productivity efforts that have also received quite some considerable investments from extension funding organs of development organizations, the government as well as research organizations, continue to provide the interface for which extension services have been retained.
The critical support perspective that this model provides is the ancillary technology support, which unfortunately is needed to a minimal level in the activities of the productive layer.
In my view, such a change should definitely trigger the necessary innovation within the agricultural learning programmes offered at the curricula level for agriculturalists where too much focus has been on drilling the learners on the knowledge to drive lower value chain activity of production and productivity. Such thinking would integrate well with the Knowledge interface of the AVAAK Centre which envisages an eLearning platform to offer continuous learning efforts, for those already in the field, as well as those aspiring to specialize in programmes driven by ICT for Agriculture or ICT4Ag.
This then ascribes the challenge in the practice of agricultural engagement to the level of attention which has been to too much to agriculture rather than to food. A time now has come when food and nutrition have become the key drivers of national and global policies in matters policy and planning. Unfortunately, much as the integration of value chain activities has become so commonplace in policy discussions, those charged with their implementation are the same actors whose training was and continues to be in productive rather than organizational supportive technologies. That is why the look at the institutional vehicles for automation is such a critical call if agriculture is to become the driver of employment and wealth creation.
It is important to understand the model presented in Figure 3. It starts with the aggregation of produce at the local producer level, then proceeds to create a market aggregator group. When farmer organizations come to play, processes of enforcing compliance are put to play. In agriculture, the only standard that works is weight. Taking care of a farmer’s produce can only be done through weighing and ensuring that that weight statistic accompanies the commodity to the market and payment is done according to the much a farmer delivered.
The foregoing is the process that the AVAAK Centre seeks to achieve. To do this, a simple handheld weighing technology driven by customized software (scale firmware) that mimics the produce weighing activities is automated and the scale powered through rechargeable batteries. The scale firmware captures the weight of the produce delivered by each farmer. The farmer details (initially downloaded to the scale from the organization’s computer room) ensures that no weighment records leaves with the scale at the begining of a field day. This process is followed every time the scale is released to the field. The production data from the farmer, whether in large volumes or small are then relayed to the produce aggregator who has another larger scale or produce collection mechanism that compares the total collections with what is received. This forms the records for the farmers and for linkage to the market. With mobile and wireless solutions now available, the communication of the data from the field to the produce aggregation centre may be varied.
The electronic weighing ensures that farmers, at whatever stage of knowledge are not taken advantage of by buyers or produce collectors. The gains from the transparency associated with the produce accuracy, which does not round the weights like the manual scales do, are used to acquire other processing technologies or machinery. Effort is made to ensure that the AVAAKs use green energy solutions.
To ensure that the benefit of integrating productive processes to the payment realizes intended results, local trainers are trained and used to train local communities on the weighing technology. eLearning platforms are used to train the local trainers who then ensure that we local dialects are used to train communities where communities do not understand English, the language used for course delivery.
The AVAAK solution has evolved to a technology that addresses the entire value chain from inputs, to service delivery, to collecting funds, through mobile money, that comes from the market. Using this model, all value chain actors are made to become value added service providers that interface with service provision and hence value addition, including those whose role was initially that of a broker.
Where there is potential for lack of information infrastructure or internet solutions, we ensure that the Knowledge perspective of the AVAAK Centre is supported through telecentres, which are community knowledge and information centers created with collaboration with the global telecentre movement led organization, Telecentre.org Foundation. The technology learning programmes are supported with the Telecentre.org Academy, which is used to certify local ICT4D trainers. VACID Africa Institute develops and delivers agribusiness and value chain linked programmes.
Those with a passion in knowledge dissemination are welcome to join us take ICT4Ag to communities. You are invited to visit our websites at www.vacidafrica.or.ke, www.octagon.co.ke, www.imapafrica.com, and www.af-mip.net to see what we have started doing and we continue to do.