Monday, July 29, 2013

Northern Smallholder Farmers Now Better Off, But......…..

One of the most cardinal strategies government could seriously consider in its attempt to eliminate extreme poverty in rural Northern Ghana, is to consciously ensure the availability of ready markets for smallholder or peasant farmers who through several governmental and private sector support initiatives, have increased the production of cereals in recent years.

In the past, most smallholder farmers in the Upper West, Upper East and Northern Regions of Ghana, could only produce to feed their families and even if there was enough for farmers to sell for income, the produce were mostly sold at cheaper prices and in worst situations, farmers did not have access to ready markets at all.

However, in the last few years some government and private sector led initiatives such as the Northern Rural Growth Project (NRGP), IFDC’s Farm to Market (FTM) project and the Farmers’ Agricultural Production and Marketing (FAMAR) project by the Association of Church-Based Development NGOs (ACDEP) in the three regions, have yielded enormous benefits to more than half a million households.

With the vision to reduce rural poverty through market linkages and the development of effective farmer based organizations [FBOs], the FAMAR project was the result of a number of feasibility studies conducted by ACDEP, a network organization of Church-based NGOs and ICCO, a Netherland’s based development organization on the possibility of creating market access for rural farmers in Northern Ghana.

Based on the findings of these studies, the partners agreed to initiate the FAMAR project [8 years comprising of phase I and phase II] with funding from ICCO and PSO and ACDEP as the implementing organization.

The FAMAR project which was one of the many projects of ACDEP, sought to establish a transparent and independent production and marketing chain that was beneficial to rural farmers in Northern Ghana and other actors involved. The first phase of the project ended in December 2007 and the second phase started in January 2008 and ended in December 2012 with funding from ICCO and the European Union.

Core Objectives of The FAMAR Project
·         To build strong FBOs that are capable of stimulating production and bargain with various partners in the interest of farmers in Northern Ghana.
·         To build the capacity of individual farmers to increase their crop yields and also to see farming as a business.
·         To network and build coalitions with other Civil Society Organisations to advocate and lobby policy makers to improve access to credit, inputs and marketing opportunities for small rural farmers.
·         Provide a secured market for small-scale farmers to sell their crops.

Savanna Farmers Marketing Company [SFMC] which is a brainchild of the FAMAR project is a registered private limited liability company envisaged to be a farmer owned company in future. 

The modus operandi of SFMC was first; to secure an attractive fair market price for Northern-based crops and second, contract farmers to produce and supply to customers according to their quality standards through the company.

The initial equity for the establishment of SFMC came from ICCO with ACDEP as the sole shareholder, holding shares in trust for the FBOs that were being developed.

SFMC has since established supply chains for sorghum, soybeans, groundnuts, cashew and sheanuts which the farmers were asked to produce. At one end of each supply chain were FBOs from 11 ACDEP stations and other local NGOs. The FBOs were contracted and supported with production credit [seed and land preparation] by SFMC and some financial institutions for the production and supply of produce.

At the other end of the chain, SFMC signed yearly supply contracts with her customers. They included Guinness Ghana Brewery Limited [Sorghum], Ghana Nuts, Vester Oil Mills, Golden Web [soybeans and groundnuts] and Global Trading of Netherland Industries [cashew].

FAMAR Sustainability Principles   

Sustainability was central to the project. Thus, the project applied the following principles.
  • Economic sustainability: Paying farmers a fair price for the produce and charging customers a competitive price in order to ensure a win-win situation for all actors; and building a solid foundation for the FBOs and SFMC to enable them operate as separate legal, self-financing and independent entities especially in the long-run.
  • Environmental sustainability: Encouraging sustainable agricultural methods such as LEISA, IPM and organic farming where possible.
  • Social sustainability: Ensuring that the project was accessible to all interested persons irrespective of sex, age, creed and tribe; discouraging child labour and marginalization of women; and building the capacity of individual farmers and farmer groups to hold their leaders accountable.  
    Farmers carting produce to buyer
Benefits of the FAMAR Project
Productivity of target farmers under the FAMAR project went up by 61 percent and acreage cultivated increased by more than 100 percent against target figures of 33 percent and 50 percent respectively. These achievements were the product of sustained and conscientious activities such as extension training for station and Ministry of Food and Agriculture staff; training of 1, 926 [1,310 males and 616 females; peer extension teachers; establishment of demonstration farms; linking farmers to financial institutions to access production credit to acquire necessary agro-inputs [fertilizers, seed, herbicides, etc]; fields days; agro-inputs days; collaboration with research institutions like Savannah Agricultural Research Institute for guidance in best agro-practices; promotion of women’s access to fertile land; and effective production monitoring visits. 

Also, another focus of the FAMAR project was to mobilize target farmers into viable three-tier gender balanced FBO system –Primary/community FBOs [PFBO], Secondary/district FBOs [SFBOs] and Tertiary/regional FBOs [TFBOs]. At present, the three-tier structure is firmly in place; each level is functioning well, with the secondary level playing pivotal roles as expected. 

The FAMAR project reached 14,438 beneficiaries [49 percent female] against a target of 10,000. These farmers had been organized into 1,003 PFBOs against 600. 304 of these FBOs are legally registered with the Department of Cooperatives [DoC] with certificates for commencement of business.

There were 12 SFBOs that had also been registered as legal entities to do business in the Republic of Ghana. The SFBOs coordinated all the business and production activities of the PFBOs like arranging for production credit and agro-inputs; arranging for market produce and mobilization of produce for marketing [produce supplied to SFMC increased from an initial volume of 957 metric tonnes in 2007 to over 3,000 metric tonnes in 2012]; arranging for training programmes for the PFBOs, etc. The SFBOs acquired offices with office managers. There were 2 in the Upper East Region, 6 in Northern Region and 4 in the Upper West Region. 

The SFBOs were the kingpins of the FBO structure directing the business engagements of the PFBOs and linking them to the TFBOs. There were 3 TFBOs, one in each region. These played advocacy roles for the FBOs. 

Thanks to the FAMAR project, rural banks could comfortably participate in agricultural value chains as lenders to smallholder farmers and aggregators, because they were sure of payback. For instance, credit provided by rural banks to farmers increased by 2,345 percent from GH¢57,251 in 2007 to GH¢1.4 million in 2012. 

Besides, the FAMAR project brought the ACDEP stations [agric service centres] closer to farmers by enabling them address their core needs of marketing, credit and productivity. Standards of living of some 15,000 rural households in the three regions increased significantly at the end of the project period.

Net income from crop production of targeted farmers increased averagely by 10 percent per year during the period the project was rolled out, mainly through the establishment of a transparent and sustainable production and marketing chain.
Woman winnowing cereals
The continued availability of a market for farm produce is the single most important sustainability factor of the FAMAR project, according to an evaluation conference held in Tamale for a selected number of representatives from the various FBOs, ACDEP, donors and other stakeholders.

Some farmers at the conference complained bitterly about the fact that, they had in stock hundreds of bags of cereals but due to unfavourable market prices currently prevailing, they could not sell them or release them to SFMC for sale.

It also emerged that, low capitalization or funding of SFMC had posed a major challenge to its profitability as the company had to rely on expensive commercial loans in order to buy produce from farmers.

Therefore, they appealed to government to be forthcoming by buying their produce at realistic prices so that they would be encouraged to increase their production.

The farmers also called on government to consider allowing foreign buyers who were interested in their produce to come into the country and buy them rather than preventing such buyers because of fears of food shortage.

Generally, most of the participants at the two-day conference agreed that the initiative by ACDEP had helped to alleviate rural poverty among a section of smallholder farmers and urged government to support farmers in Northern Ghana to gain sufficient access to markets in and outside the country with their produce. In their estimation, the era of farmers only farming to feed their families was no longer feasible especially when they need to meet other domestic expenses. 

ACDEP was formed in 1997. It is a network of forty church-based NGOs in the three regions of the North of Ghana with a secretariat in Tamale. The intervention programmes of the forty NGOs are agriculture, natural resources management, water and sanitation, primary healthcare, rehabilitation of persons with disabilities, economic empowerment of women and the provision of rural infrastructure.

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