MOVE UP OR MOVE OUT: TRANSFORMING SMALLHOLDER FAMILY FARMS
Women Farmers in field, Nalanda District, Bihar. Source: (flickr) Divya Pandey, IFPRI
Most smallholder farms are family-based—of the world’s 570 million farms, 88 percent are family farms while 84 percent are small. Smallholder farms, with an average size of 2 hectares or less, provide not only livelihoods to 2.5 billion people but also 80 percent of the food consumed in Asia and Africa south of the Sahara. Nevertheless, with emerging challenges such as climate change, price shocks, agricultural-related risks to health, and limited access to finance and capital, smallholder farmers will suffer the most.
In the light of these challenges, strategies are needed that are tailored to different types of smallholders and a country’s level of transformation, said IFPRI Director General Shenggen Fan at last month’s M.S. Swaminathan Research Foundation’s campus in Chennai, India, where he spoke on “Enhancing the Profitability of Family Farms” at the Asia-Pacific Regional Consultation on the “Role of Family Farming in the 21st Century: Achieving the Zero Hunger Challenges by 2025.
According to Fan, research shows that smallholders with profit potential should move up from subsistence to profitable farming systems and that already profitable smallholders need to scale up commercial activities. Conversely, farmers who lack profit potential should move out of agriculture and into non-farm employment.
Policies should reflect a country’s stages of transformation: from increased productivity among smallholder farmers to institutional reforms, leading to high-value agriculture and improved links to global and urban markets.
Using the example of India, Fan said that linking farmers with a dairy grid connected over 13 million of farmers—over 25 percent of whom were women—which not only increased their bargaining power but it also helped to provide demand information and reduce costs and risks.
Fan concluded his presentation by outlining next steps to enhance profitability of smallholder family farms, which includes
- Institutional reforms that strengthen land rights and help facilitate land transactions (particularly though rental markets),
- Increase linkages between smallholders and value chains,
- Provision of smallholder-friendly financing,
- Promotion of price stabilization mechanisms, and
- Development of programs that target young farmers
