discussion paper_ contract services for smallholders_lund nov2015 word version
TRANSCRIPT
Brian Lund 11/01/2015
Contract Services for Smallholders.
A rethink of the SRI narrative through a business lens
Discussion paper
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Contents
Purpose ......................................................................................................................................................... 1
The rice value chain ..................................................................................................................................... 2
Quantifying this unrealized value ........................................................................................................... 3
Potential contribution to the household income .............................................................................. 3
Potential contribution to GNP .............................................................................................................. 4
SRI as a triple bottom line ........................................................................................................................ 4
The need for a new way to present this opportunity to farmers .............................................................. 5
SRI - slow growth in Cambodia ................................................................................................................ 5
Reliance on farmer-facing extension services ...................................................................................... 5
Moving to a market-based solution ............................................................................................................ 6
Building technically competent teams .............................................................................................. 6
Marketing directed toward smallholders ........................................................................................... 7
Market testing .......................................................................................................................................... 7
Options to strengthen the model ................................................................................................................ 8
Service guarantees .............................................................................................................................. 8
Options to broaden the model ..................................................................................................................... 8
The production/value chain ................................................................................................................ 8
Risk analysis ............................................................................................................................................... 10
Oxfam’s role ................................................................................................................................................ 11
Evaluation of the FLAIR program ....................................................................................................... 11
Links to the Cambodian OCS .............................................................................................................. 12
Experience of Oxfam and partners .................................................................................................... 12
Resource Development ...................................................................................................................... 12
Purpose This paper argues that there is significant unrealized value in the rice value chain that could be developed for the smallholder client and that this would be best realized in Cambodia by opting for a market-based approach to agricultural services rather than the extension-based approaches we see more commonly applied in the rural sector in developing economies. This opens smallholder to a different perspective as to how to address opportunities and challenges in agriculture and potentially a very different set of market relationships, some of which will be broached here. The paper’s initial focus for discussion is the husbandry package known as the System of Rice Intensification (SRI). It is discussed as key amongst several entry points presenting the smallholder potential economic gains in the rice value chain. Finally the paper begins to lay out how Oxfam might engage with a view toward a new approach to our rural development program.
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The rice value chain The simplest description of the rice value chain in Cambodia can be summed up as 1) the farmer; typically a smallholder with landholdings averaging 1 hectare, 2) the middleman who buys the harvest at farm gate price for resale for milling, further aggregation or informal export markets, 3) the miller who may store and further aggregate, 4) the wholesaler/retailer who may export. Using the Average yield for the National crop at 2.6t/ha as reported by the Cambodian government1 and a farm gate price of $200/t the current value chain is portrayed in the table2 and schematic.
Schematic representation of the Rice Value Chain (red) and the potential increase (black)
This modeling suggests that the greatest potential gain lies with the farmer but that all agents stand to make substantial gains. Middle men and millers stand to gain where farmers produce increased quality and consistency of grain but also through aspects such as improved mill-ability and sale-ability. AThe exporter/retailer is most likely to gain from premium and niche market opportunities3.
1 National statistics, Ministry of Agriculture Forestry and Fisheries 2015 report 2 Need to do more work on verifying these figures. May be able to adapt the results of the study in the Philippines conducted by MicroSave 3 This is based on the performance of SRI as a crop husbandry package for smallholders as detailed in text.
Stage value as % of retail price
KH (USD)/ha KH (USD)/ha
wholesaler/retailer. Value aded through market distribution and retailing
9% 104$ estimate 10% increase for premium markets 114$
miller. Value added through grading, milling, storage, wholesaling
40% 485$ estimate 10% increase for millability and storage 534$
local trader. Value added through aggregation, grading, storage and timing of sales
9% 104$ estimate 10% increase for grain quality, storage and handling 114$
farmer. Value added to the farm gate 43% 520$ estimate 54% increase based on SRI husbandry before gains from improved input quality, storage and markets
800$
100% 1,213$ 1,563$
Potential Increase to value chainCurrent value chainTable showing indicative profile of the Rice Value Chain
. .1600 1600
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ecatre of rice g
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While there has been growth in all parts of the value chain in recent years, growth at the Farmer level has remained relatively slow – and what growth there is can be largely attributable to increasing commercialization and less so smallholder farming. This can be seen in the following graph that show the average yields (t/ha) for each province over the last 10 years. The majority of provinces (reliant on conventionally grown un-irrigated rice farming practices) are currently producing 2.8t/ha which is well below demonstrated potentials. Also the trend line suggests that at current rates it would take another 20 seasons for the national crop average to approach 4t/ha
The paper argues that this amounts to unrealized value, a large part of which could flow to the smallholder farmer.
Quantifying this unrealized value Looking primarily at potential gains from good husbandry it is possible to make an estimate of the unrealized value. To this end crop performance under SRI is considered. The basic crop husbandry described in SRI leads to consistent crop production improvements. This is rarely disputed4. Since its introduction to Cambodia reported levels of productivity improvement from SRI varied considerably. In response, in 2006 AusAID (now AusTrade) and GTZ (now GIZ) conducted what was considered at the time to be a watershed study of SRI projects in Cambodia5. They determined that where SRI was practiced properly, farmers achieved an average increase in crop production of 1.45t/ha without increase in input costs, this was a 60% gain from the reported national crop average of 2.4t/ha6 at the time.
Potential contribution to the household income Using these established production parameters it is possible to provide a crude estimate of the potential contribution of SRI to the livelihood of the farmer with a small landholding. On average farmers in Cambodia cultivate 1 ha of arable land. At the same time, the government is reporting an 4 What is disputed around SRI is 1) the precise list of husbandry practices and whether or not application of a subset of the practices constitutes SRI adoption, 2) an interpretation of input costs – especially labor costs-‐-‐that suggests that revenue gains may be negated by higher costs, resulting in negligible net income increases, 3) conceptualization of SRI as a set of principles applicable to whole-‐farm ecology. 5 Vannaro P & Seth S (2006) Survey of SRI and other rice management practices on acid soils in Prey Veng Province of Cambodia 2006. Technical report funded by the Australian Embassy, Cambodia and GTZ.
3.539 3.619 3.622 3.66 3.812 3.709 3.761 3.827 3.6701 0.103055 0.010622.75 2.5 2.75 2.43 2.915 2.738 2.575 2.712 2.6732 0.141534 0.0200322.334 2.697 2.654 2.86 2.957 2.902 2.835 2.579 2.6946 0.194552 0.037852.471 2.359 2.456 2.54 2.755 2.736 2.748 2.815 2.5355 0.22796 0.0519662.085 2.341 2.501 2.61 2.681 2.738 2.788 2.791 2.534 0.231683 0.0536773.044 3.079 2.96 3.11 3.34 3.328 3.398 3.447 3.1317 0.253723 0.0643753.4 3.195 3.502 3.53 3.68 3.572 3.553 3.599 3.3937 0.267113 0.07135
3.288 3.427 3.553 3.66 3.868 3.885 3.896 3.76 3.5641 0.295426 0.0872772.566 2.767 2.975 3.03 3.106 3.121 3.137 3.084 2.8614 0.297312 0.0883942.858 2.561 2.588 2.95 3.189 3.31 3.307 3.236 2.9326 0.308055 0.0948982.121 2.542 2.523 2.8 2.891 2.658 2.875 2.743 2.5443 0.308341 0.0950742.401 2 2.521 2.6 2.686 2.726 2.87 2.812 2.4755 0.326089 0.1063341.915 1.826 2.101 2.14 2.62 2.286 2.481 2.379 2.1141 0.329717 0.1087131.6 2.072 2.105 2.51 2.604 2.283 2.542 2.104 2.1491 0.339885 0.115522
2.441 2.336 2.462 2.69 3.11 3.015 3.074 2.852 2.6514 0.340574 0.115992.627 3.473 3.303 2.92 2.882 2.906 2.933 2.881 3.1067 0.3424 0.117238
3 3.276 3.725 3.48 3.597 3.466 3.453 2.988 3.319 0.265966 0.0707381.72 1.862 2 2.5 2.6 2.391 2.203 2.448 2.0993 0.380924 0.1451031.74 2.5 2.667 2.65 2.758 3.126 2.95 2.83 2.6221 0.398434 0.1587492.252 2.388 2.476 2.56 2.751 2.788 2.888 2.905 2.4487 0.430793 0.1855822.439 2.807 2.866 3 3.295 3.223 3.313 3.253 2.8663 0.43147 0.1861661.823 2.121 2.467 2.67 2.944 2.814 2.842 2.735 2.4033 0.468296 0.2193011.75 2.611 2.961 3.1 3.199 3.196 3.215 3.257 2.8112 0.500252 0.2502525.514 2.645 2.643 2.78 3.183 3.43 3.405 3.231 3.1233 0.953549 0.909255
3.449 3.449
3.23.43.63.84
1 3 5 7 9
Kandal
Kandal
Linear(Kandal)
R² = 0.0874
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Average Yield (t/ha) fo
r each province
Sketch showing trend in Rice yields (t/ha) across all provinces .Data from MAFF 2005-‐2004 extrapolation to 2034
KandalStueng TrengBatambangK.ThomKoh KongPrey VengK.ChamTakeoKampotKratieB. MeancheyPreah VihearMondolkiriOtadar Mean CheyK.SpeuPhnom PenhPailinRatanakiriPreahsihanoukSvay RiengK.ChhnangSiemReapKep2005 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 2 6 27 28 29 30 31 32 33 2034
Trendline
season
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increase in the national crop to 2.6t/ha with the majority crop being conventionally grown un-irrigated rice. The SRI assessment in 2006 indicated a minimum of 1.45t/ha additional yield which at a farm gate value of $200/t/ha is equivalent to an increase by 56% from $520/ha to $810/ha for the farmer.
Potential contribution to GNP Using national parameters it is possible to provide a crude estimate of the potential contribution of SRI to the Cambodian GNP. Given the national crop encompasses 2.6million hectares and the potential of SRI to increase yield by 1.45t/ha the increase in the national crop would be 3.8million ton. Applying a more conservative extrapolation; if farmers applied SRI to only half this crop area and their yield results where only half as good as the benchmarked increase, the SRI contribution to the national crop would be 0.95million ton. Assuming an export value of USD$200/t (check WB report) this would equate to USD$190 million pa7. By comparison, in neighboring Vietnam where the government has chosen to actively invest in SRI extension authorities are now reporting 1.8million smallholder participants each realizing an additional 250-USD650 at the farm gate each year. Using the lower figure in this range, this equates to a minimum annual addition to the rural economy of USD$450,000,000.
SRI as a triple bottom line While there is rightly, continuing debate around the limitations and portrayal of SRI beit as a recipe or as a menu for the hand-planted rice crop, there is much less debate about each of the components of crop husbandry described as component parts of SRI having the potential to contribute to a stronger crop for the smallholder: The soil, seed and seeding preparation is reflective of best practice in practically any crop, while the weed and water management is much more reflective of local circumstances and therefore variable. Importantly, smallholders are quick to recognize and adapt the components best suited to them regardless of the debate. But despite many smallholders having demonstrated gains over the 30 years that SRI has been described, dissemination and adoption of SRI is still limited. The concern must be that relying on current dissemination/extension strategies risks the passing of another 30 years after which majority of poor farmers would still have been without the opportunity to try SRI for themselves8. In layman’s terms SRI is simply a compilation of recognized good husbandry practices relevant to hand-planted rice crops. It offers a triple bottom line: 1. In social terms, because the component parts of the compilation are easy to understand and
can be applied separately, it provides an exceptional space for poor and risk averse farmers to gain experience in adaptation and risk-taking. It also factors in improvement to much of the crop management traditionally delegated to women, and builds a culture of sharing and learning from each other.
2. In environmental terms, SRI requires less agricultural inputs; fosters a stronger stewardship of resources like seed, water and soil; encourages organic produce and seed production; and reduces methane gas emissions from rice production.
3. In economic terms it offers significantly greater crop production and farm-gate returns while potentially incurring less input costs.
This paper focuses only on the later point, arguing from the perspective of the economic advantage.
7 Lund (2010) Investing in quality agricultural extension -‐ The right blend for Cambodia. An internal paper for Oxfam America. Figures need updating as farm gate price in 2015 is nearer $200/t 8 A second concern must be – what happens to the next bottom-‐up innovation – will it also take 30 years to reach this far?
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The need for a new way to present this opportunity to farmers SRI - slow growth in Cambodia Given the unrealized economic value alone it is striking that SRI has seen quite slow dissemination and take-up in Cambodia. Reports place current take-up at just 150,000 of Cambodia’s 4 million farmers increasing at approximately 5,000 farmers per year9. While there is ongoing debate as to the contributing factors, this paper argues that two factors in particular are at play; 1. A reliance on farmer-facing extension services so that after 30 years the vast majority of
smallholder farmers still have never had the opportunity to see and assess SRI. 2. Where smallholders are exposed to SRI there has been insufficient support in addressing the
risk-averseness responses that they choose - or are compelled to choose - that result in them not adopting SRI.
3. Even where farmers are inclined to adopt SRI, they are then compelled to recruit family or community members to do the same. This requires them to invest additional effort in persuading family and community to ‘try something new’ this is not always easy particularly where rural communities are experiencing an increasing outward migration of the able-bodied labor needed to make SRI work.
Reliance on farmer-facing extension services The majority of improvements in agriculture in Cambodia are introduced via extension services working with smallholder farmers. Unfortunately the quality and scale of extension services continues to be quite variable – particularly services offered to poor smallholders. These extension services can be categorized as follows; 1. Extension actors – the public sector. This is largely government department officers, trained
and mandated to deliver extension services to Cambodia’s farming community. While they are well trained and often reasonably resourced (via development agency projects), their effectiveness is curtailed by the patronage system that pervades Cambodia’s public sector. As a consequence the extension officers low salaries compels them to rent-seek from farmers rather than empower them to act independently. Government officers are also increasingly inclined to work with larger land holders because the extension is easier and the rent seeking prospects are greater.
2. Extension actors – the development agencies. This category includes INGOs, LNGOs and academic institutions. Generally speaking they make up the weight of effective extension services currently active in Cambodia. They encompass a wide range of competencies, sometimes effective, sometimes not so effective. There is a general lack of coordination leading to overlap, inefficiencies There is also tendency toward short term objectives (given they are very often bound by short term project funding). This has the effect of compromising longer term strategic thinking need to encourage services at scale.
3. Extension actors – private sector. To date the private sector has not engaged in farmer extension in a systematic manner. The agri-business paradigm is often based on the one-off transaction. The concept of mutual gain leading to repeat business with an established client base is not particularly evident despite many small businesses being based in the farming communities. The US INGO iDE has been addressing this with some success through a program called Farm Business Advisors (FBAs) who are trained as quality input sellers able to provide good advice. However, there are still very many communities without this support. Bigger private sector investors are much more inclined to seek land concentration so they themselves can move to a mechanized system and realize the productivity potentials on offer.
9 Personal Communication, Mr Luy PiseyRith, Program Coordinator, Oxfam US
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Regardless the quality of extension the fundamental approach is generally farmer-facing. As illustrated in the sketch above the extension service is directed toward the smallholder after which the smallholder is left to only a “take-it-or-leave-it” response to the improvement on offer. Essentially at this point, farmers who are inherently risk averse are asked to shoulder new risk.
Moving to a market-based solution While there are numerous market-based models operating in the agricultural sector this paper focuses of one model that recognizes the smallholder as the client for agricultural services. Essentially this requires the design to view the smallholder as a client able to purchase services rather than as a student of new approaches in agriculture. As indicated by the red text in the sketch below this requires a shift in approach whereby 1) small teams are trained and supported in service delivery, 2) marketing is directed toward the smallholder so she is informed, and ultimately 3) she has more options available if she chooses to pursue improvements.
Building technically competent teams With SRI as the entry point, intensive extension training would be directed toward selected community members (not necessarily farmers but also landless, land-poor, women and youth with experience in farming), who have an interest in forming into small business teams able to provide on-farm services. The first objective would be to ensure they achieved a high degree of competence in the good husbandry techniques promoted in SRI. The second objective would be to provide training including finance10, small business, and entrepreneurial skills11. Teams would then
10 Savings for Change
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be formed and supported with resourcing, marketing and coordination services until they established a viable client base of smallholder farmers who have retained secure land tenure and thereby can become more financially independent and sustainable.
Marketing directed toward smallholders At the same time a marketing strategy would be implemented so that smallholders are aware of the service available to them, how to access it and what to expect. This approach would;
1) Take away some of the risk that the individual farmer confronts when trying a new practice for the first time. Where previously the farmer had to build experience in each new technique, here the teams are trained and less likely to make mistakes.
2) Amplify the reach of extension investments as the service teams would benefit from being their own advocates, (also other NGOs working with communities could recruit these services),
3) Eliminate barriers to implementation such as labor supply. As the teams would ideally operate throughout the growing season and thereby eliminate reliance on the availability of incidental labor from family and community members.
At the same time the approach would help 1) Realize the economic potential of the crop by bringing up yields. 2) Keep money and job opportunity in the local economy – most service team members are
likely to be locals selected by their community. 3) Open opportunity for additional services and small business opportunity. These could
include deep-ripping as a climate change mitigation measure, local laser leveling to improve water control, ploughing and field preparation, nursery management, weeding, accurately timed fertilizer services, local seed improvement harvest, post-harvest drying and storage, etc.
Market testing In keeping with Oxfam’s partnership approach the thinking developed in this paper emerges from close cooperation with local partner organizations. In particular two local NGOs, Rachana and Srer Khmer who helped in the formative stages of this thinking then took up the challenge to begin market testing by establishing Service Teams during the 2016 cropping season and undertaking some marketing. Their prelimary results are presented here. Rachana; • Service team with 22 women members. IDPoor112 (2), IDPoor 2 (6), People living with HIV (2), other poor (12) • 22.9 ha of paddy land served: SRI direct rice seed plant (19.42 ha) and weeding use the Rice Dragon13 (3.5
ha) • They charge 450,000 riels/ha about $112.5/ha. Total they earned 10,316,000 riels ($2,579) With the money they earned, the team dicided to distribute to each member and 21 members used those money to buy materials for their children to school. One of the women used her money to buy vegetable seed and fertilizer Srer Khmer; System of Rice Intensification Service Provider Group (SRI-SPG)
11 The International Labor Organization (ILO) is currently promoting a community-‐based entrepreneurial package (C-‐BED) in Cambodia that would be ideal in this instance 12 IDPoor is a national system for identifying the extent of poverty that people are contending with. It allows identification of the absolute poorest for support. 13 The Rice Dragon is a weeding tool that is operated by hand (see cover page). Good weed control has the potential to increase crop productivity by 1tonne/ha.
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• Service group of 20 members, including women (17) • 1.2 ha of paddy land (testing service) Sareing village, Srer Sdock commune, Kandeing district Pursat
province • They charged 360000riels/ha= $90/ha Srer Khmer also began testing additional services, provide in-depth capacity for the Service Teams on SRI, broadcasting techniques, using a drum seeder, direct rice seed planting and use trans-planting machines. Their Initial marketing included distribution of 15,000 Public leaflets on SRI-SPG information At the time of writing the crop is still to be harvested so the gains for the farmer have yet to be fully determined. Nonetheless both organizations have already seen encouraging success in both the supply side (people’s interest in joining teams) and the demand side (both organizations were unable to keep up with the level of initial interest for their services).
Options to strengthen the model Service guarantees Even with the increased options available via this approach it is recognized that smallholders are still likely to remain risk averse and slow to adopt. The proportion of farmers prepared to take this risk is typically low. Roger’s Adoption Curve14 is particularly useful in conveying this characteristic; typically only innovators and early adopters are inclined to take on new risk. While the majorities of the population wait for increasing confidence and assurance before they will act – without attention to real risks and risk aversion the prospect of improvements are adopted at scale is lessened. One option to address this would be guarantees whereby smallholders that use the service of endorsed service providers will be guaranteed yield outcomes equivalent to the provincial average plus 1 tonne/ha. Pending questions of who funds the risk, cash flow management, field verification etc an approach like this would also allow farmers to gain the firsthand experience and trust in Service teams. Arguably it would also serve as an introduction to insurance concepts that may come into the market at a future point.
Options to broaden the model The production/value chain Aside from the guarantee, once the teams begin gaining credibility as service providers their repertoire of services could be expanded so as to introduce other services beyond SRI planting15. It is to be expected that Oxfam’s partner organizations and the Service teams will be able to build out a diverse repertoire as they build experience but some to the initial options for investigations include; 1. Nursery management ensuring even and healthy seedlings – ideally using improved or locally
selected varieties.
14 Rogers, E. (1962) Diffusion of innovations. Free Press, London,
15 Both Rachana and Srer Khmer are addressing this from the perspective of additional services and also the continuity of work for the service teams
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• Hand planted crops require that farmers set up a small nursery in order to germinate and ready seedlings for transplanting. There are several photo-sanitary techniques known to improve the vigor of nursery stock but these techniques are not used. Also individual farmers are often caught with over-grown seedlings when their planning is upset by late rains.
• Benefit to smallholder: reduced risk of low quality seedlings, assures of 7-10 day old seedlings are produced under optimal conditions.
2. Field preparation • Field preparation (cultivation) is frequently outsourced already. In this instance the
service could become part of an entire package making it convenient for farmers16. • Benefit to smallholder: yield improvement of 1.45t/ha. Lessened risk of crop loss due to
uncertain rainfall patterns. 3. SRI planting
• While SRI planting is main focus of this paper there are numerous refinements that could be introduced via the Service Teams. Over time the teams will gain experience in recognizing optimal plant densities for each soil type across entire districts17.
• The teams may opt for night planting, allowing them optimize the window of time available for planting and/or allowing them to avoid the heat of the day.
• Benefit to smallholder: yield improvement of 1.45t/ha. Lessened risk of crop loss due to uncertain rainfall patterns.
4. Weeding of crops • Oxfam has been working to introduce a weeding tool (the rice dragon) as a means of
improving crop productivity while reducing labor inputs. In its first season the project achieved brand recognition from marketing, exceeding 50%. As recognition and market experience grows smallholders are seek Rice Dragon teams to weed their crops. The teams are well placed to offer weeding as a service in their repertoire.
• Benefit to smallholder: shown to increase productivity by up to 1t/ha 5. Duck-Rice systems
• There are several systems whereby ducks are either herded or fenced in the rice crop in order to control insects and broadleaf weeds. Business models vary from ‘farmers renting the flock’ to duck growers ‘renting the field’.
• Not a common approach in Cambodia despite substantial flocks in key provinces such as Kampong Speu and Kampong Cham.
• Benefit to smallholder: Thailand smallholders have reported up to 15% increase in crop productivity due to pest control and duck manure.
6. Local seed improvement – by preselecting seed from better preforming areas of crop prior to harvest.
• There are several simple techniques available to smallholders whereby they can improve the quality of their own seed reserves (for subsequent planting). These techniques are not often applied.
• Benefit to smallholder: shown to increase productivity of subsequent crop up to 20%
16 Could be option to introduce equipment to overcome the drudgery of planting in the heat of the day; by provide shade in the field and/or lighting for night work.
17 Could be option to introduce equipment to overcome the drudgery of planting in the heat of the day; by provide shade in the field and/or lighting for night work.
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7. Harvesting • While this is generally a family and community collective activity, the migration of labor
from rural areas is affecting labor availability. While the service teams could engage here, there is also the prospect of contracting combine harvest machinery.
• Benefit to smallholder: Minimize damaged and dirty grain which otherwise reduces price at the mill.
8. Bagging for storage using hermetically sealed bags • Up to 30% of the harvest can suffer insect damage if stored incorrectly18. Hermetically
sealed (air-tight) bags offer a proven solution but they require an ability to assure grain moisture contents of 11 to 12%. The equipment and know-how to do this is available but is rarely used by smallholders because it does require a good knowledge of how to manage seed moisture content. Good storage also offers opportunities to smooth supply and develop specialized markets.
• Benefit to smallholder: Eliminate post-harvest insect damage. Opens new marketing options.
9. Harvest aggregation and marketing • Several examples of specialized marketing have emerged: in Cambodia (Ibis Rice) has
targeted European markets and Sano rice has begun scoping for the Netherlands and global markets, in Vietnam (Lotus Rice) has targeted USA markets. All of these markets function on the basis of ‘environmental friendliness’.
• Benefit to smallholders: Market able to attract a premium. 10. Introducing innovation
• The teams are particularly well placed as a focus for introducing new techniques and technologies. They can be skill-up and supported in field testing innovations that could then translate into addition services in the repertoire. Examples include seeding and transplanting machinery appropriate for smallholder farming; crop rotations; cover cropping
• This would require organizations like Royal University of Agriculture, Srer Khmer and Rachana increasingly working with the teams as their primary client for new technologies, business models, marketing and extension approaches.
• Benefit to smallholders: Able to take advantage of new innovations without being exposed to the risks and barriers to adoption that they would otherwise encounter when working alone.
Risk analysis Risks of primary concern for this program include the following:
• Risk of reliance on external service providers. Rather than the smallholder having the expertise and the option of acting as she sees fit she would be reliant on the service teams knowing their job and being able available at the right times19.
• Smallholders are familiar with negotiating short-term cash flow deficient when they recruit labor for harvest but are only able to make payment when they’ve received payment for the crop. Other services earlier in the crop cycle will extend this deficit period – and risk.
18 Reference from Thailand report. Need details 19 Personal communication University California, Davis Extension Team Apr 2015
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• Guarantees and related products like microfinance are relatively unknown to the farming community. It will take time to build trust in these products.
• Women are increasingly the decision makers in farm management. Introduction of a new service could see a shift toward men taking control where that was not the case before.
• The model requires being able to recruit and maintain service teams. In turn this requires being able to build a critical mass of clients in order to keep teams employed.
• Farmers may learn enough from the teams to decide to undertake some tasks by themselves thereby not needed the full teams for labor, the demand for the teams could gradually decline as the knowledge transfer is successful.
• The work is seasonal. Team members are likely to migrate in the ‘off season’ necessitating a team rebuilding process each year.
• Monitoring of team and crop performance plus smallholder client feedback will be critical to the success of this approach if at scale. The monitoring tools are not yet designed.
Oxfam’s role The experience of Oxfam as an exponent of SRI provides an extraordinary platform for pursuing this new approach. For Oxfam’s part the statistics indicate that our partners reached over 58,000 people and that they gained over $10 million at the farm gate. Oxfam’s investment over this time totaled $3.7M over the 10 years with an average return of $3 for every $1 invested by Oxfam
Evaluation of the FLAIR program Nonetheless, the most recent program design incorporating SRI was FLAIR. This program was orientated toward farmer-facing extension with the objectives extending beyond extension for technology transfer to women’s empowerment. In implementation the program was successful in;
• Encouraging good quality extension services • Engaging government agencies and influencing national policy and strategy development • Good work achieved by development sector actors.
It was less effective in; • express objectives around women’s empowerment
YearOUS
Investment
SRI program directly
supported by OA
SRI program across
Cambodia
SRI program directly
supported by OA
SRI program across
Cambodia$(USD)/t
SRI program directly
supported by OA
SRI program across
Cambodia
2005 $ 125,000 field trials
2006 $ 209,436 1,634 60,000 409 16,386 1.31 $ 240 $ 128,432 $ 5,151,758 2007 $ 482,466 2,712 82,386 814 47,039 1.29 $ 240 $ 251,891 $ 14,563,274 2008 526,500$ 3,835 104,750 1,342 58,291 1.3 $ 240 $ 418,782 $ 18,186,792 2009 $ 420,722 3,609 110,530 1,112 59,785 1.66 $ 259 $ 477,930 $ 25,703,963 2010 $ 517,620 6,188 124,820 1,270 61,291 1.53 $ 258 $ 501,320 $ 24,194,009 2011 $ 528,061 9,058 149,185 3,996 94,681 1.35 $ 239 $ 1,287,350 $ 30,506,218 2012 $ 333,133 13,097 149,657 6,189 100,720 1.43 $ 254 $ 2,247,838 $ 36,583,518 2013 $ 294,967 9,818 na 11,328 na 1.40 $ 250 $ 3,964,709 na
2014 $ 325,654 8,868 na 6,877 na 0.92 $ 250 $ 1,581,641 na
Total 3,763,559$ 58,819 781,328 33,335 438,193 $ 10,859,893 $154,889,534 Source: MAFF reports, grant reports
Estimated value to rural economy (USD)
SRI in CambodiaNo. farmers adopting SRI
(HH)Area of SRI (ha) Increase in
yield above national average (t/ha)
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• Encouraging public sector investment of budget resources • Encouraging private sector engagement
The experience and learning from these outcomes underpins this new approach.
Links to the Cambodian OCS The Cambodian OCS very specifically prioritizes resilience of smallholders and opts for a way-of-working based around evidence based influencing of public and private policy and practices plus positioning partner organizations to take on implementation at scale. The Service Team approach is entirely consistent with the OCS and it opens additional opportunities for the OCS given the emphasis on markets, women and landlessness.
Experience of Oxfam and partners • Experience in agricultural extension pertaining to SRI research, promotion, training and
monitoring. • Experience in targeted marketing directed toward rural communities • Experience in micro-insurances • Potential for partners to offer service using a social enterprise model • A sound program design • Identifying people to participate in SRI training; service team candidates and smallholders • Marketing to smallholders • Setting up the crop guarantee system (including IT4D – crop tracking) • Lobby, campaign and advocacy at policy level • Coordinating role • Bridge between institution and extension service providers
Resource Development • Able to access conventional development resources. While resource development sector
bilateral and multilateral donors is becoming increasingly competitive, Oxfam is well placed to coordinate collective bids for partner organizations. Also specific thematics such as food security, women in agriculture, youth in rural economies, privates sector engagement remain prominent.
• Increasingly positioned to encourage private sector investment. Give the extent of unrealized wealth described in this paper, the prospect that private sector investment to capture some of that wealth must be considered.
• Increasingly versed in new investment instruments like Development Impact Bonds with the potential to take a rollout of any initiative to genuine scale.
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