While the private sector is emerging as a key player in linking larger-scale commercial farmers with markets, voluntary producer organizations of various types, such as co-operatives, will have important roles to play in providing the basic linkages between small-scale farmers and businesses (agro-service centres, food processors, manufacturers, traders, supermarkets and other food outlets) that do not have the ability or will to deal with small-scale farmers on an individual basis. Simply because farms are small in size does not imply they are not commercially viable per se or that they can become so. Indeed many large-scale commercial farms, especially state-owned ones, are not economically viable. A distinction must be made between small farms and resource-poor farmers. Small farms in Africa have scope for sustainable intensification that is productive, profitable and environmentally sound, provided they have equitable access to input and output markets, credit, innovations, knowledge and information.
Linking farmers and businesses creates opportunities, adds value to producer efforts and helps serve businesses by providing an efficient conduit to reach the mass of small-scale producers. Such producer organizations will play a central role in gaining value from market and trade systems development, investing in technology systems and improving access to micro-finance. Effective producer organizations can also add to the social capital of a community, enhancing the likelihood of effective cooperation in areas such as natural resource management. Farmer organizations in several African countries have successfully strengthened farmers' market participation.
Investments in strengthening producer organizations should have the following benefits: lower marketing margins and higher prices for producers; improved product quality; increased access to extension, input and financial services; and greater participation by the rural majority in decisionmaking processes.
Unlike former state co-operatives that are widely discredited because of their poor performance and high cost, key design principles for future organizations will ensure they are voluntarily organized, economically viable, self-sustaining, self-governed, transparent, and responsive to community and producer-based groups. Supporting these kinds of organizations will require government and donor involvement, engaging with businesses, ngos, and other civil society groups.
