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The Importance of Standards

Quality standards are increasingly important for farmers to be able to export in high-value markets. Two case studies illustrate both the risks and the potential benefits for farmers related to meeting export standards. Farmers in Kenya defaulted after having their produce refused by an exporter for failing to adhere to export standards. In Honduras, Wal-Mart was able to enforce the practices needed to export jalapeno peppers.

Index Insurance for Managing Climate-related Agricultural Risk: Toward a Strategic Research Agenda

In October 2011,the CGIAR program on Climate Change, Agriculture and Food Security (CCAFS) and the Index Insurance Innovation Initiative (I4) organized a jointworkshop hosted by the International Food Policy Research Institute (IFPRI). The workshop was designed to identify and address issues surrounding index‐based insurance for smallholder farmers and the rural poor in the developing world. Emphasis was placed on identifying key areas of research and learning for the academic and policy community to pursue.

Adoption of Weather-Index Insurance: Learning from Willingness to Pay Among a Panel of Households in Rural Ethiopia

In this paper we examine which farmers would be early entrants into weather index insurance markets in Ethiopia, were such markets to develop on a large scale. We do this by examining the determinants of willingness to pay for weather insurance among 1,400 Ethiopian households that have been tracked for 15 years as part of the Ethiopia Rural Household Survey. This provides both historical and current information with which to assess the determinants of demand. We find that educated, rich, and proactive individuals were more likely to purchase insurance.

An Experiment on the Impact of Weather Shocks and Insurance on Risky Investment

We conduct a framed field experiment in rural Ethiopia to test the seminal hypothesis that insurance provision induces farmers to take greater, yet profitable, risks. Farmers participated in a game protocol in which they were asked to make a simple decision: whether to purchase fertilizer, and if so, how many bags. The return to fertilizer was dependent on a stochastic weather draw made in each round of the game protocol. In later rounds of the game protocol, a random selection of farmers made this decision in the presence of a stylized weather-index insurance contract.

Smallholders and Inclusive Growth in Agricultural Value Chains

This paper investigates inclusive growth in agricultural value chains, with a focus on smallholder participation, upgrading behavior, and outcomes related to agricultural productivity, agricultural profits, and smallholder incomes. The purpose of the paper is to advance understanding of inclusive growth by reviewing empirical evidence from twelve agricultural value chains that have engaged and benefited smallholders. The review of evidence focuses on three central questions:

The Impact of Weather Insurance on Consumption, Investment, and Welfare

Weather variations crucially act the wellbeing of farmers in developing countries yet weather insurance is rather rare. I develop and estimate a dynamic stochastic optimization model to assess the impact of weather insurance on the consumption, investment, and welfare for farmers in developing countries. The parameters of the model are pinned down with a combination of calibration and structural estimation using data from Malawi.

Value Chain Development in Nicaragua: Prevailing Approaches and Tools used for Design and Implementation

This article draws on four contrasting cases of value chain development (VCD) in Nicaragua to assess approaches and tools used in design and implementation. We interviewed 28 representatives from the international NGOs leading the interventions, the local NGOs that participated in implementation, principal buyers, and cooperatives.

Value Chain Financing: Evidence from Zambia on Smallholder Access to Finance for Mechanization

Smallholder farmers in Zambia comprise 85 per cent of the farmers’ population. Such farmers are regarded as not creditworthy and furthermore their agricultural productivity could be improved. The aim of this paper is to present recent evidence on value chain financing (VCF) as a framework to increase access to agricultural finance for Zambian smallholder farmers. Such financing will act as an enabler to mechanize and, in turn, might improve productivity. Qualitative data collection techniques were followed to provide the results as presented in three illustrative case studies.

Africa Agriculture Status Report 2017

The authors first discuss the value of value chains and how they can benefit from resilience. They follow this with a detailed analysis of the risks and resilience of different components of the value chain and conclude with a discussion of the business of resilience.  

Here is a list of key messages from this paper:

LINK methodology: A Participatory Guide to Business Models that Link Smallholders to Markets

Helps actors understand the current functioning of the market chain and key business models, design innovations that empower producer groups to engage more effectively and buyers to act in ways more amenable to smallholder farmers.

Working with Smallholders: A Handbook for Firms Building Sustainable Supply Chains

This handbook prepared by the International Finance Corporation presents the benefits and challenges of sourcing from smallholder farmers.

Good Practice Handbook: Assessing and Managing Environmental and Social Risks in Agro-Commodity Supply Chain

Supply chain risk has become a major area of concern for companies in the agribusiness sector, as well as for their customers, financiers, and external stakeholders. This Good Practice Handbook is intended for those agro-commodity companies that want to better manage supply chain environmental and social risks. The Handbook focuses on five major agro-commodity supply chains—palm oil, soy, sugarcane, cocoa, and coffee—but many of the tools, resources, and case studies can be used as guidance for other agro-commodities.

Evaluating Value Chain Interventions: A Review of Recent Evidence

This ILRI discussion paper reviews 20 value chain interventions and discusses the econometric techniques used to address the validity of findings. It explores the use of propensity score matching, instrumental variables, difference in difference, regression discontinuity, and randomized controlled trials. Qualitative and participatory methods are also examined with the idea that they may be able to better capture the complexity of value chain processes.

Contract Farming Handbook

Sound planning, appropriate skills and adequate approaches for starting-up and operating contract farming (CF) schemes are key to success and sustainability. Therefore GIZ has issued the “Contract Farming Handbook”, which provides a practical and process-oriented approach guiding practitioners through sound planning, starting up, consolidation and up-scaling of CF schemes.

UNIDROIT/FAO/IFAD Legal Guide on Contract Farming

The UNIDROIT/FAO/IFAD Legal Guide on Contract Farming is an important resource for designing contract farming arrangements. It provides advice and guidance on the entire relationship, from negotiation to conclusion, including performance and possible breach or termination of the contract. The Guide provides a description of common contract terms and a discussion of legal issues and critical problems that may arise under various practical situations, illustrating how they may be treated under different legal systems.

Promoting Value Chains of Neglected and Underutilized Species

This guide from the Global Facilitation Unit for Underutilized Species draws on several successful country experiences promoting and developing value chains for underutilized crops. It focuses on the particular characteristics of neglected and underutilized crops and how to develop supply and demand based strategies to improve pro-poor development and preserve biodiversity.

A participatory and Area-Based Approach to Agricultural Development

This guide from CIAT is the first of a four-part series on good practices for value chain development. It emphasizes a participatory approach to build the marketing capibilities of small farmers. 

This strategy paper provides an overview of CIAT’s approach to rural agroenterprise development. The participatory and area based or “territorial” approach is made up from a number of methods and tools that have been developed by the Rural Agroenterprise Development Project team and its partners through project work in Latin America, Africa and Asia over the past 10 years.

A Participatory Guide to Developing Partnerships, Area Resource Assessments, and Planning Together

The second in a four-part series from CIAT of good practice guides for value chain development.

The aim of this guide is to provide a systematic means to (i) select and evaluate an area, (ii) establish an overall working group to support inter-institutional agroenterprise development, (iii) profile client groups to implement enterprises, and (iv) agree area plans for joint activities.

Wheat value-chain tool in Ethiopia

Wheat is one of the four most important food grains in Ethiopia. As a source of calories in the diet, wheat is second to maize.  In terms of the area of production, wheat is fourth, after teff, maize, and sorghum.  In terms of the value of production, it is 4th or 5th, after teff, enset, and maize, and approximately tied with sorghum. 

Wheat production has expanded rapidly in the past decade.  According to the CSA, wheat production has grown at 7.5% per year since 1995-96 and at 9.3% over the past decade.

Mozambique Agricultural Value Chain Analysis

USAID/Mozambique commissioned a value chain analysis (VCA) to prioritize and guide interventions within and across target value chains. The analysis targeted nine value chains, as summarized below: 

Value-chain development for rural poverty reduction: A reality check and a warning

This article draws attention to the link between Value Chain Development and smallholder livelihood strategies that comprise a complex mix of subsistence and market-oriented activities and that are diversified to meet multiple livelihood goals and mitigate risks; and the authors address the related implications for the design and assessment of value-chain interventions. They question some of the underlying assumptions of NGOs, government agencies, and private-sector agents seeking to link smallholders to higher-value markets.

Measuring postharvest losses at the farm level in Malawi

Reducing food loss and waste are important policy objectives prominently featured in the United Nation’s Sustainable Development Goals. To optimally design interventions targeted at reducing losses, it is important to know where losses are concentrated between the farm and fork. This paper measures farmlevel postharvest losses for three main crops—maize, soy, and groundnuts—among 1,200 households in Malawi.

Identifying Priority Value-chains in Ethiopia

A major challenge when designing a National Agricultural Investment Plan (NAIP) is deciding how to prioritize between different opportunities, e.g., which value-chains should be promoted over others?

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