SMALLHOLDER RICE FARMERS IN MALAWI CAN BE PROFITABLY INCLUDED
Rollins Chitika
Outlook
• Introduction
• Learning from an Inclusive Rice Business Model
• Exploring Key Actors in the MHL Value Chain
• Benefits Accrued to MHL Value Chains
• Benefits of including Smallholder Farmers
• Understanding the target group
• Challenges and Lessons Learnt
Introduction
Improved technology
Change in Modus Operandi
Millions displaced
Introduction (Cont’d)
• Inclusive value chains are relevant.
• BUT– Can small-scale producers, artisans, traders be
part of this change? – Does their inclusiveness contribute to the
profitability of the entire sector in the long-run? – Is it possible to have even other members of
the value chain benefit from being part of it?
Learning from an Inclusive Rice Business Model
• MHL Rice Processing
– $17.5m investment
– 200MT/day processing
– 70ha scheme
– 7, 000 smallholders
Benefits Accrued to Key Chain Actors
Benefits of Including Smallholder Farmers
• Access to land
• Access to inputs
• Mechanized farming
• Company ownership by smallholder farmers
• Access to modern agricultural extension services
• Increased household income
Understanding the Target Group
PPI Score% of the respondents
(Before)% of the respondents
(After)10-14 515-19 530-34 20 1035-39 25 2040-44 15 2045-49 15 1050-54 15 1560-64 5 1070-74 5 5
The majority have the likelihood of 77.5% living below a poverty line of $1.25 both before and after joining the scheme.
Key Challenges
• Huge factory capacity (200MT/day)-need for more
rice.
• Side selling
• Support for smallholder shares (40%)-to be
redeemed over time.
• MHL could not be supported with a start up
capital and this affected the take-off.
Lessons Learnt
• The poor were thoughtfully considered in developing this value chain.
• As the value chain develops, the benefits are also translated to all players (including the resource poor farmers).
• The initiative is likely to boost production in the long run.
• Though the poor are already disadvantaged because of lack of resources, if well included they can help drive development.
Full Article
http://developmentbookshop.com/commercial-and-inclusive-value-chains
Thank You
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