Making international supply chains work better for smallholder farmers

By Aurelie Walker, Trade Policy Advisor, Fairtrade Foundation

Making International Supply Chains Work Better for Smallholder Farmers

Making international supply chains work better for smallholder farmers is a potential ‘win-win’ for thousands of farmers and businesses.

A new reportby the Fairtrade Foundation analyses six case studies from farmer groups producing tea, cocoa and nuts in Kenya, Cote D’Ivoire and Malawi asking them from their experience, what really makes trade fair?

This report, authored by Twin Trading, marks the start of a Fairtrade Foundation project sharing best practice from 15 years of experience working with different actors along the supply chain from farmers through to traders, importers, retailers and consumers. with a view to seeing more businesses source more from smallholder farmers according to best practice.

At the heart of creating more empowering relationships between buyers and farmer organisations (and between farmer organisations and farmers) is a shift in attitude and perception. To move forward it is important that buyers perceive farmers as active partners and not passive beneficiaries.

The farmers interviewed identified technical support provided by, or funded by, buyers as a key reason for wanting to trade with them. All the case studies contained in the report identified a fine balancing act required between farmer organisations receiving much needed intensive support from traders and avoiding an unhealthy dependency on external support.

The nature of the farmer-buyer relationship was a key theme running through all six case studies. The report concluded that farmers need to be part of a two way conversation with key value chain actors to identify and respond to systemic issues. Many farmers want to know where their produce goes and express an enhanced sense of ownership in the finished product when they have this information. Knowledge of where the product goes is reported to provide an opportunity for farmers to develop personal relationships with buyers and to build more durable trading arrangements which may contribute to growing the market.

Although there is not necessarily a material advantage from this knowledge, it is a valuable act in humanising the value chain. Farmer organisations also identified feedback on quality and access to market information as ‘critical’ to enable them to negotiate contracts with buyers.

The report recommendations to buyers include; provide information to farmer organisations on where their produce has gone, including information on quality with recommended steps to address any issues; respect producer intellectual property when marketing product but promote the face and people behind it; build administrative capacity of farmer organisations, not just training individual farmers; set targets over time for farmer organisations to sell to other buyers; and develop a memorandum of understanding between business and farmer organisation to clarify expectations of relationships.

The Fairtrade Foundation invited government officials, fair trade organisations, UK businesses and multinational companies, consumers and NGOs to engage with the recommendations at the report launch at the Commonwealth Secretariat. Beatrice Makwenda of the National Smallholder Farmers Association of Malawi (NASFAM) speaking at the report launch stated, ‘farming organisations like NASFAM face many challenges at the moment like increased production costs, impact of climate change and access to finance. Businesses need to recognize that we are the most important part of the supply chain and without us there will be no food. We are asking them to work in closer partnership with us to listen and respond to our needs.’

You can read more about the debate and outcomes of the conference here. Why not discuss them with your sector peers and be part of a movement to change business practice? What comes to mind when you think about how you will change practice or policy in your work to make international supply chains work better for smallholder farmers? Email us le*************@fa*******.ukor post a comment below.

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