Value chains and access to markets

A product – including food - is rarely directly consumed at the place of its production. It is transformed, combined with other products, transported, packaged and displayed until it reaches the final consumer. In this process the raw materials, intermediate products and final products are owned by various actors who are linked by trade and services, each one adding more value to the product. Various types of public and private services, i.e. input provision, financial and advisory services, infrastructure, transport, telecommunication as well as stable legal framework conditions, are required to create a conducive environment for value chains to develop. By deriving employment and income, small and medium farmers and businesses benefit from markets, if their access to functioning value chains is secured. Understanding such interactions of a value chain helps to identify possible points of intervention to increase efficiency and thereby contributing to generate opportunities in rural areas.

Value chain development is primarily covered by the SDC Employment and Income network. Notwithstanding, this chapter/sub-site covers a series of important issues regarding value chain and access to markets with a focus on agriculture and agribusiness.


Key documents:

Reference Paper on Donor Interventions in Value Chain Development
 Reference Paper on Donor Interventions in Value Chain Development, Community of Practice on Value Chains in Rural Development
May 2007
Author: SDC (ed.)
These guidelines highlight the most important issues that development agencies need to consider when they engage in value chain development in rural areas. The paper offers guiding principles for development practitioners and policy makers, and points to further useful material. This paper is based on the insights gained during the online debate on the forum “Value Chains in Rural Development” operated by SDC, with its various and sometimes contradicting examples, cases, perceptions and discussions.



Linking African Smallholders to High Value Markets

Linking African Smallholders to High-Value Markets: Practitioners Perspectives on Benefits, Constraints, and Interventions, Policy Research Working Paper 4573
March 2008
Author: Spencer Henson, Steven Jaffee, John Cranfield, Jose Blandon & Paul Siegel
This paper provides the results of an international survey of practitioners with experience in facilitating the participation of African smallholder farmers in supply chains for higher-value and/or differentiated agricultural products. It explores their perceptions about the constraints inhibiting and the impacts associated with this supply chain participation. It also examines their perceptions about the factors affecting the success of project and policy interventions in this area, about how this success is and should be measured, and about the appropriate roles for national governments, the private sector, and development assistance entities in facilitating smallholder gains in this area. The results confirm a growing ‘consensus’ about institutional roles, yet suggest some ambiguity regarding the impacts of smallholder participation in higher-value supply chains and the appropriateness of the indicators most commonly used to gauge such impacts. The results also suggest a need to strengthen knowledge about both the ‘old’ and ‘new’ sets of constraints (and solutions) related to remunerative smallholder inclusion, in the form of the rising role of standards alongside more long-standing concerns about infrastructure and logistical links to markets.


Promoting market access for the rural poor in order to achieve the millennium development goals

Promoting market access for the rural poor in order to achieve the millennium development goals, Roundtable Discussion Paper for the of IFAD’s Governing Council
2003
Author: IFAD (ed.)
Markets are of fundamental importance in the livelihood strategy of most rural households, rich and poor alike. Markets are where as producers they buy their inputs and sell their products; as consumers it is where they spend their income from the sale of crops or from their non-agricultural activities to buy their food and other consumption goods. Because of this rural poor people in many parts of the world often indicate that one reason they cannot improve their living standards is that they face serious difficulties in accessing markets. Low population densities in rural areas, remote locations and high transport costs present real physical difficulties in accessing markets. The rural poor are also often constrained by their lack of understanding of the markets, their limited business and negotiating skills, and their lack of an organization that could give them the bargaining power they require to interact on equal terms with other, larger and stronger market intermediaries. Furthermore, rural producers from developing countries face significant impediments in accessing rich countries’ markets.


Selected links:

Print version  |   Send page as a link