Linking Small Farmers to Markets

Brief Overview and Updates: Where we are and its link to

ASEAN

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LSFM context• Small farmers and agricultural

producers are unable to benefit from the price differential between farm gate and market price of their products

• They have very little opportunity in understanding the dynamics of the market, supply and demand conditions, economy of scale, etc.

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poverty made worse by:

• TRADE LIBERALIZATION (Unjust trade rules that prevent people from receiving a fair price for their goods; competition from cheap imports; price manipulation)

• CLIMATE CHANGE (Droughts, erosion and other environmental causes that threaten the land and water on which their farming depends)

• POOR INFRA, INVESTMENT IN AGRI (High cost of doing business in isolated areas where roads and communications are poor)

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• Only very few NGOs have acted out as effective market facilitators and intermediators.

• AsiaDHRRA believes that markets have an important role in rural development and poverty alleviation in rural Southeast Asia.

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strategic goal

• Thus, LSFM’s strategic goal is to contribute to the reduction of rural poverty in Southeast Asia by empowering small farmers and producers to effectively engage the markets.

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Market Intermediation Mechanism

Strengthening

Building

Policy Advocacy

Partnership Building

Capability-building

Five Components of LSFM

Market Research

Market Intermediati

on Mechanism

BuildingStrengthening

Market ResearchMapping Marketing

initiatives

Value Change Analysis

Production Capacity Inventory

Policy Advocacy

Small Farmers/ Producers

Groups

Partnership Building

Formal Markets

Governments/ASEAN & Other

Asian International

Bodies

Capability-building

NGOsAgricultural Commodities

Challenges

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Selected Agricultural Commodities

Tea in Vietnam

Free-range chicken in Cambodia

Calamansi in the Philippines

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Researches and Studies Outputs

1. Map of CSO Marketing Initiatives in three (3) pilot countries

2. Value chain study of fresh calamansi fruit commodity, puree and powder

3. Value chain study of free-range native chicken

4. Value chain study of tea

5. Inventory of production capacities of selected small farmer organizations

6. Capacity-assessment of selected farmers organization

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LSFM Training Workshops

1. Regional Forum and Training Workshop entitled “Making markets work for small farmers: Understanding Marketing and Market Intermediation” in Hanoi, Vietnam, June 7-9, 2008.

2. Regional Training Workshop entitled “Complying with Market Requirements on Food Safety and Product Quality,” Siem Reap, Cambodia, January 19-23, 2009.

3. Two National Training Workshops in Cambodia

4. One National Training Workshop in the Philippines entitled “Achieving Economy of Scale Towards Successful Market Engagement”

A total of 137 farmer leaders, NGO staff and advocates undertook training workshops at the regional and national levels.

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Partnership-Building

1. Creation of the Project Advisory Committee (PAC) at the regional level with the representation from the business sector, academe, NGOs and farmers organization.

2. Creation of National Project Advisory Group/Technical Working groups in 3 pilot countries.

3. Partnership with FAO, World Rural Forum

4. Mobilization of Agriculture Ministry/Department’s, other government agencies at the local and national levels.

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Policy Advocacy

1.Partnership with World Rural Forum in an advocacy for a UN declaration for an Internationl Day of Small Farmers/Small Holder Agriculture

2.Identified a policy paper for the support and protection of small holder agriculture/small farmers for food security and poverty reduction goals.

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Market Intermediation Mechanisms

1.CEDAC Natural Agriculture Product Shops and Country Bird Restaurants in Cambodia;

2.Upland Marketing Foundation, Inc. in the Philippines; and

3.VNFU as facilitator of Supply Contracts in Vietnam.

Identified and linked the following to act as market intermediation mechanism in each of the pilot country:

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Challenges

• Most farmers relate with markets. Complete subsistence farming are very few.

• Most studies have pointed out that access of small farmers to markets are weak because (among others):

1. They have weak technical capacity2. The are faced with extreme difficulties in

comply w/standards3. They are confronting with strict contract

conditions4. They lack the resources5. They are exposed to additional risks.

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Challenges

These weaknesses by small farmers are heightened by: • The policies of privatization, liberalization

and the creation of the WTO and the European Union in the 1980s to 2000s that triggered investments by food manufacturers and retailers.

• Simultaneously with the increased urbanization and the shift of consumer preferences.

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Challenges

• A tremendous increase in modern food processing

• Very tight competition

• Retail business became much more complicated

• Higher product quality and food safety requirements, now we have additional certification, labelling, traceability requirements

• Much higher production and marketing costs

The results pushed small farmers into a more disadvantaged position:

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Challenges

Access of small farmers to markets has further weakened:• Buyers would prefer to establish a plantations for a

certain agricultual product or deal only with large suppliers, aggregators, middlemen and traders,

• Than deal with small farmers because of issues of pole-vaulting, low product quality and very high costs related to dealing thousands of individual small farmers.

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Challenges

The is therefore a need to support small farmers at the ground level to achieved the following::1. Groups or cluster small farmers based on the

agricultural product are formed so that they will be able to consolidate production at economic scale;

2. Provision of specific agricultural extension and training to help small farmers produce better quality products; and

3. Help them plan to achieve a synchronize production system to ensure that there is available supply and that delivery of a specific commodity is ensured periodically and regularly.

Association of Southeast Asian NationsAssociation of Southeast Asian Nations

Ten nations, One communityTen nations, One community

ASEAN SecretariatASEAN Secretariat

ASEAN Secretariat building inaugurated on 9 May 1981ASEAN Secretariat building inaugurated on 9 May 1981

Jakarta, IndonesiaJakarta, Indonesia

ASEAN Member Countries

Brunei DarussalamCambodiaIndonesia

LaosMalaysiaMyanmar

PhilippinesSingaporeThailandViet Nam

Area and Population

Country

Land

Population (million) 2006 (1000 Km2)

Brunei Darussalam 5.8 0.383

Cambodia 181 14.2

Indonesia 1,891 222

Lao PDR 237 5.75

Malaysia 330 26.6

Myanmar 677 57.2

Philippines 300 87.1

Singapore 0.7 4.48

Thailand 513 62.8

Viet Nam 329 84.2

Economic Performance

CountryGDP per capita (in

USD) 2006GDP total

(in billion USD) 2006

Brunei Darussalam 30,159 11.55

Cambodia 512 7.26

Indonesia 1,640 364

Lao PDR 613 3.52

Malaysia 5,890 156.9

Myanmar 208 11.95

Philippines 1,356 118.1

Singapore 29,500 132.3

Thailand 3,289 207

Viet Nam 724 61

URBANIZED Countries

Brunei Darussalam 2.1%

Singapore0.1%

AGRICULTURE-based Countries

Cambodia 33.1%

Lao PDR 50.2%

Myanmar 42.9%TRANSFORMING Countries

Indonesia 15%

Malaysia 7.7%

Philippines 19.1%

Thailand 9.3%

Vietnam 20.2%

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Goals of ASEAN

• To accelerate the economic growth, social progress and cultural development in the region through joint endeavors; and

• To promote regional peace and stability through abiding respect for justice and the rule of law.

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ASEAN VISION 2020(1997)

• A concert of Southeast Asian nations, outward looking, living in peace, stability and prosperity, bonded together in partnership in dynamic development and in a community of caring societies.

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as civil society, we need to know our agenda... What is ASEAN?

What is our take on the ASEAN as an institution? How does it affect our lives and where is this taking us?

Who are we? Why are we stakeholders in this? Who’s interests do we represent?

What do we want? What is our own vision of ASEAN? What do we want ASEAN to be? Where should our ASEAN take us?

Where do we then take ASEAN?28

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Dreaming for an Ideal Regionalism for ASEAN: Key Principles

•Cooperation and solidarity based on equity, peace and justice

•People’s participation and empowerment in decision-making With concrete mechanisms for participation at different levels and components

•Accountability and transparency addressing the basic needs of the people

•Based on people’s control over and rights to productive resources

•Recognition of human rights and fundamental rights of basic sectors

•Principles of sustainable development: inter-generational equity

•Sharing of appropriate and environmentally-friendly technologies

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an integration that is..

• Not just economic/trade: political, social, cultural, environment

• Result of an endogenous process• People must have a feeling of ownership over

the regional integration process and governance

• Premised on the need for countries to give up some of their sovereignty and powers to the regional process/ structures of governance

• Fundamental principles of civil society engagement with governments should be the basis of engagement on regionalism

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www.aseanfoundation.org

ASEAN Foundation ASEAN Foundation 19971997

Objectives of the ASEAN Foundation

Promote greater awareness of ASEAN, and greater interaction among the peoples of ASEAN as well as their wider participation in ASEAN's activities inter alia through human resources development that will enable them to realize their full potential and capacity to contribute to progress of ASEAN Member States as productive and responsible members of society.

Endeavour to contribute to the evolution of a development cooperation strategy that promotes mutual assistance, equitable economic development, and the alleviation of poverty.

Objectives of the ASEAN Foundation

Farmers can overcome difficulties with: • Knowledge • Skills • New technology • Capital

 They need knowledge to make more informed decisions about what to produce, when to produce it, at what price, for whom and in what quantities.

Small producers often lack the knowledge they need to identify new products or buyers in order to compete.

Small producers need help to ensure the quality of their products, obtain loans, manage their resources and ensure their operations are efficient and profitable. They need skills on processing, quality control, packaging, marketing and finance.

Simple, low-cost technology that adds value to raw goods can dramatically improve the long-term incomes of small producers.

Small producers need credit and capital to sustain their operations

ON-GOING AF PROJECTSFocus on Bridging Farmers to Markets

• Linking Small Farmers to Market

• Strengthening Capacity of Small Holder Aquaculture Farmers for Competitive and Sustainable Aquaculture

• Capacity Building on Supply Chain Management for Agribusiness SMEs in the Mekong Region

Thank You