Increasing the Economic Role for Smallholder Farmers in the World Market for Horticultural Food

Smallholder farmers will be critical to meeting the growing demand for food in the next 40 years. However, currently they face many challenges in meeting the changing demands of modern markets, including the effects of climate change, deficiencies in their enabling environment, resources, capacities and institutional models for change and development. In this chapter we set the context by defining these deficiencies and their implications for development of the smallholder horticultural sector. We present a dualistic agribusiness systems framework that helps focus analysis on the interactions in the system and the complexity of the problems. This framework helps highlight the need to develop new institutional approaches to link smallholder farmers to markets and to improve their productivity. We then review some options for linking them to markets and conclude that a range of solutions will be required, but that contract farming and traditional cooperatives will only be relevant to a limited range of contexts. We suggest that cluster marketing arrangements will be another important solution, because they are suited better to smallholder resources and capacities. They can also be used as a means to develop a horticultural innovation system that meets the needs of smallholder farmers rather than just the needs of larger enterprises.