UNDP/AGRA catalytic grants have proven benefits for farming cooperatives in the groundnut value chain in Malawi
19 May 2023
An agri-food value chain is a set of linked activities that work to create an agricultural product from start to finish. For RFS projects, adopting an agri-food value chain approach means designing and implementing interventions that address constraints and challenges that exist within specific links of an agricultural production system—from input suppliers to end markets.
Smallholder farmers in RFS countries primarily produce agricultural products for household consumption or operate within informal ‘short’ agri-food value chains that supply their local community. Smallholder farmers often sell crops, livestock, and other raw materials, either directly or through middlemen, to small local stores or markets. These markets are characterised by low value products, low prices, and low and inconsistent returns for farmers.
For those smallholder farmers who only produce for household consumption, gaining entry into either informal or formal agri-food value chains has the potential to significantly increase incomes and provide opportunities for growth. For smallholder farmers already operating within informal value chains, entry into formal agri-food value chains can provide exposure to new markets, opportunities to pivot to higher value crops, skills upgrading and greater income security.
One of the most significant barriers to agri-food value chain development, and improvement in smallholder incomes, is access to end markets. The lack of smallholder participation in markets is caused by a number of challenges: inability to supply consistent products; lack of road infrastructure, transport, and storage; lack of access to credit and technologies; and lack of commercial information, contracting and coordination.
The RFS programme is focused on developing sustainable food value chains within country projects. This approach combines the concept of value chains with sustainable development criteria, ensuring that value chain development is (a) economically sustainable; (b) socially sustainable; and (c) environmentally sustainable.
By applying a sustainable value chain approach to RFS project design and implementation, country project teams are able to analyse food production systems within their project sites, identify weak links within food value chains and design targeted interventions that will remove constraints so that the value chain can develop. Target interventions may include improving seed quality, establishing producer organisations, constructing storage facilities, facilitating communication with markets and establishing platforms for private sector engagement.
The ultimate aim of these interventions is to introduce, develop or expand value chains that are inclusive of smallholder farmers, connect rural communities with larger markets, improve household incomes and are sustainable in the long-term.
Value chain and market access interventions encompass a wide variety of activities. Within the RFS programme, the main objective of the value chain approach is to analyse the entire food value chain, identify constraints within the value chain, and design and implement multilateral interventions to address those constraints so that the value chain can develop and provide improved, sustainable income for smallholder farmers.
Many RFS country projects teams are tailoring this approach to their specific country context. In Eswatini, the RFS country project team has identified potential value chains with existing, but untapped markets to support and promote, including poultry and beekeeping. In Senegal, UNIDO and IFAD have targeted six agro-value chains for intervention with the goal of decreasing post-harvest losses, promoting energy efficiency and managing natural resources. In Nigeria, the RFS project is developing interstate value chains in key food commodities (cassava, maize, rice, and sorghum) through the establishment of public-private partnerships.
Explore the RFS Country Projects to see more examples of how RFS countries are implementing Value Chain & Market Access activities.
Stories from the Field
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