The importance of small farmers
Micro, small and medium enterprises (MSMEs) play a critical role in the food system in developing countries. Worldwide, SME farms produce approximately 50% of calories, over 85% of fruits and vegetables and about 80% of meat and dairy.(1) A total of 72-83% of food in India includes SMEs in the value chain (2) while in Pakistan over 90% of enterprises are SMEs. (3)
Unlevel playing field
Yet SMEs do not have a level playing field in the food industry value chain. Small food producers often do not have access to the latest techniques in farming, lack technical skills and cannot afford improved tools and materials.
Small businesses also have inequitable access to financing because of higher risk due to price volatility, inadequate financial records, seasonal cashflows, short credit histories and lack of typical types of collateral. Investing in LMICs can also be considered risky by investors due to poor infrastructure, weak regulatory systems and political instability. A report from Dalberg-KfW estimated there is an annual US$65 billion lending gap in sub-Saharan Africa for medium-sized value chain businesses (4) with micro and small enterprises faring even worse. Small-scale farmers thus usually lack capital funding to invest in equipment.
Both financing and technical assistance are critically important to make small-scale farmers more resilient and capable of increasing their crop yields. Financial and technical assistance can come from international NGOs (INGOs), development lenders, governments and industry associations.
Biofortification: an opportunity for farmers and communities
Farmers have the opportunity to provide healthy diets not just for themselves but also for their communities.
Our bodies need fruits, vegetables and proteins to ensure we intake sufficient micronutrients – vitamins and minerals – necessary for growth and health. However, when people’s diets do not provide sufficient micronutrients, then steps must be taken to add those micronutrients to the population’s diet. This can involve micronutrient supplements for pregnant women and children as well as food fortification, through which micronutrients are added to food staples such as rice, flour, salt, spices and fish sauce.
An additional method to increase micronutrients in a population’s diet is biofortification. With biofortification, micronutrients that naturally occur in crops are enhanced through the breeding process. This results in crops with higher levels of specific vitamins and minerals. Examples include beans and millet biofortified with iron as well as plantains, sweet potatoes and maize biofortified with vitamin A. Almost 300 biofortified varieties of 13 staple crops are grown or tested in over 60 LMICs in Latin America, Africa and Asia, with 48 million people in smallholder farming households benefiting, according to HarvestPlus.(5)
Using biofortified seeds helps not just the farmers and their families when they eat their crops but also benefits the communities in which they sell their yields. In addition, biofortified crops can command higher prices on the market, raising the incomes of the farmers who grow them.
Again, assistance from governments, development organizations, extension programs from universities and private industry is needed to help spread biofortified crops to small-scale farmers in Latin American, the Caribbean, Africa and Asia. HarvestPlus’ Biofortification Index is also a good place to start, to learn which biofortified products have the biggest ROIs in each country.
Sources
(1) Herrero M, et al. 2017. Farming and the geography of nutrient production for human use: A transdisciplinary analysis. The Lancet. Planetary Health, 1(1), e33–e42. https://doi.org/10.1016/S2542-5196(17)30007-4
(2) Reardon T, et al. 2020. COVID-19’s Disruption of India’s Transformed Food Supply Chains. Economic & Political Weekly, LV (18).
(3) Noor K, Kwizera A, et al. 2020. The role of MSMEs in food systems: now more critical than ever. GAIN.
(4) Dalberg. 2018. The Economics of Agri-SME Lending in East Africa. Summary Document.
(5) https://www.harvestplus.org/harvestplus-biofortified-crops-map-and-table-updated-with-2020-data/