Development programmes seek to turn smallholders into rural entrepreneurs and advocate “farming as a business”. This is very desirable, but is difficult to achieve where farmers are unsure of their ability to feed themselves throughout the year. In country after country, surveys show that a small percentage of smallholders sell most of the marketable surplus, while most of them are in deficit, and must buy food to meet their lean-season requirements. Indeed, they must often sell food to get cash at harvest time only to buy the food back at higher prices later in the year.
For this reason, projects which focus on household food security can do much to unlock the potential of farming communities. I draw the reader’s attention to two very successful initiatives:
- The Central American Post-Cosecha project, see link. This four-country initiative started in 1983, lasted for over twenty years, and resulted in small farmers acquiring large number of galvanised iron silos where they could store their maize crop without infestation or physical loss (by 2009, some 415,000 families had 600,000 storage silos in operation with capacity of around 380,000 tonnes). Successive evaluations have found this innovation to be a source of multiple benefits much valued by farmers, notably: reduction in losses due to insects, rats and moulds; they can reliably store their food for household consumption (without the nagging fear that the cobs are infested or rotten); they can sell the surplus food at higher prices in the lean season; it enhances the position of women in the household, and; it improves household hygiene. It moreover makes an important contribution to the stabilisation of food prices throughout Central America.
- The Malagasy Village Communal Granaries (GCV) loans initiative. GCV loans are a microfinance product that allow rural people to store crops (overwhelmingly paddy rice) locally, typically 1-2 tons per family, both for home consumption and for sale. Farmers store most of the stock in household compounds, with three of four farmers typically sharing the same store. The commodity serves as collateral and is held in a secure building under a dual-lock arrangement, with the farmers and the microfinance institution each holding the key to one lock. The pioneering CECAM mutual microfinance network was built up around the GCV product, which constitutes over 40% of its loan portfolio. Other networks have since adopted the product with great success, and by 2013, the volume of commodity annually stored was in excess of 100,000 tons per annum. Repayment rates are around 99%, though with up to 5% of repayments being made beyond their due date.
These initiatives have important differences. Post-cosecha provides a new hermetic structure (metal silo) to overcome difficulties of storing a pest-susceptible commodity for many months. The GCVs are mainly concerned with paddy rice that is relatively easy to store, but give the farmer access to credit he/she needs to hold it back. For the same reason the GCVs can only work if supported by a strong microfinance network.
However, these initiatives have two important features in common. Firstly, farmers are motivated as much by concerns over household food security and better management of family resources as they are with earning money from marketing the crop. Secondly, storage takes place in households rather than in communal stores, giving those households considerable autonomy of action; as suggested by the name Village Communal Granaries the CECAMs started with communal village stores. However, the promoters learned through hard experience that borrowers performed better when they held stocks in household compounds. Decentralisation and household autonomy seem to have been important ingredients to the success of both initiatives.
I invite the reader to comment on these cases, and other variants of which they are aware.