Economic Opportunity Mailing List Archive

["William Kedrock" <<address removed>>]

Good Day,
 
A first timer here. I'm intrigued by many of the discussions but find so
little time to provide input/feedback. 
 
Though I might not put it in terms of access to markets, I do agree that
even farmers in the most remote areas can effectively move produce. We
see commodities go from basket to sack to multiple sacks on a bicycle to
a full pick up truck to a loaded Bedford. The produce moves effectively
but not efficiently. The role of collectors is paramount in such a
system. Actions to cut them out can increase efficiency and returns to
farmers, but it is not easy nor always advisable.
 
This is where I think price information is important. It may not
increase access per se but it does move needed information from the
buyer to the seller. Collectors trade on information. The asymmentry of
that information gives them an advantage. They are not likely to
willingly increase margins for farmers. An informed farmer though is in
a better position to ask for a better farmgate price. Moreover, if
embedded in that price information are signals that improved quality
garners a higher price, the farmer can then make an informed choice as
to whether the higher price for better quality is worth the investment.
 
Collectors play an important role in effective access to markets. Price
information that targets the farmer helps level the negotiations and
allows the farmer to make informed decisions when trading with these
collectors.
 
Cheers,
 
William Kedrock
Chemonics International
<address removed>
tel: 202-955-7426
fax: 202-955-7550

-----Original Message-----
From: Vinay Chand [mailto:<address removed> 
Sent: Wednesday, May 05, 2004 7:53 PM
To: economic-opportunity
Subject: access to markets


Taking Colin's last point about moving the discussion on to constraints
to access to markets and assets, in my experience, farmers including
small farmers nearly always have access to markets.
 
It is not the access that I find to be constrained, rather the terms on
which access is granted. To see the implication for the smaller farmer
it is sufficient to look at the physical disposition of what he
produces. It has to be picked up from the field, not the nearest road.
The farmer may carry it to the road or a larger farmer may do so on its
way to the farmers market in the locality.
 
Unless the transaction is within the family with land that has been
divided up between members but who still co-operate, or a collective
organisation between a number of small farmers, whosoever collects the
produce can end up making the same for it as the farmer. The role of
collectors is critical here. Collectors aggregate produce from a number
of small farmers and take it to a local market where it is normally
bought by a transporter/wholesaler taking it to a larger market unless
of course the collector is also a wholesaler.
 
The importance of looking at this key part of the value chain, which is
necessary in my opinion if there is to be an efforts to maximise farmer
incomes, is often obfuscated by confusion between farmers, collectors
and wholesalers and their roles at major markets. The buying price at
wholesale markets was being published in Sri Lanka, for example as a
producer price and there were proposals to install sophisticated
information systems to transmit prices including these producer ones.
 
Real time market price information does not increase access to markets
for particularly small farmers, it is of no possible use for them. Yet
the idea appeals to educated planners as part of a transparency process.
Real time prices are of interest only to traders and transporters. It
can guide them to markets where they would obtain marginally better
prices.
 
Again, I would return to farm gate prices and the share of final retail
prices that farmers get. Increasing farmer margins will make production
more responsive to price movements and to what consumers want. If a
farmer only gets 1/10 or less of the retail price, shelf price movements
reflect only trader activity. When the farmer gets 1/5 of the retail
price, there is a more efficient transmission of market signals. 
 
The farmer does need to be told about market demand movements and that
is the role of extension as far as I am concerned and transmitting
analysis rather than real prices.
 
Best wishes,
 
Vinay Chand,
230, Finchley Road,
London NW3 6DJ, UK
Tel: 44-20-7794 5977
Fax: 44-20-7431 5715
<address removed>