Planting a Better Life for Smallholder Farmers


An initiative launched by IFC and partners will offer farmers access to agricultural practices aimed at increasing their farms’ productivity and profitability. © Bayer 


Ruth Kajuju farms on two acres in Kenya, but her dreams are bigger than her land. She’s confident that she could successfully triple her workload, farming five or more acres: “I would improve my social status and be better able to look after my family,” she says.

It’s a sad irony that smallholder farmers like Kajuju, who spend their lives growing food, must often live on less than $2 per day. Despite their occupation—and their role combatting global food insecurity—many go hungry because they have limited access to inputs and infrastructure, and have little or no direct access to markets.

Because of crop losses—including those linked to diseases and prolonged dry spells—many smallholder farmers, who typically rely only on family labor, reach less than 20 percent of their potential productivity. The adverse effects of climate change further increase farmers’ risks and contribute to market price fluctuations.

The Better Life Farming initiative, launched this week at the Spring Meetings, aims to help smallholder farmers like Kajuju combat these issues, improving their farms’ sustainability and commercial viability. Kajuju, who participated in a Better Life pilot project, thinks it’s already created a more solid foundation for her: “As a result of this initiative, I see myself making major progress in the next three years,” she says.

The initiative is the result of a partnership between IFC, Bayer Crop Science, the global insurance company Swiss Re Corporate Solutions, and Netafim, a leader in drip irrigation technology. The goal is to reach millions of smallholder farmers by 2030.

 

Feeding the Developing World

The 450 million smallholder farmers who live across Africa and Asia play a critical role feeding up to 80 percent of the developing world. IFC and its partners in Better Life will capitalize on decades of combined private sector agribusiness experience to provide financial security and boost agricultural know-how so that these family farming enterprises can reach their potential.

The Better Life Farming partners recognize there is no one-size-fits-all solution to these challenges, and that stakeholders in the agribusiness sector need to adopt a holistic “ecosystem” approach to working with smallholders. Better Life Farming will do this by offering farmers access to advanced agricultural practices ranging from seeds to crop protection, irrigation, training, finance, and insurance.

Better Life Farming partners all have a long-term commitment to the smallholder to grow more and higher quality food, which will increase the farms’ profitability and improve livelihoods for workers. Additional local and global partners with a shared commitment to this goal may join the alliance.

 

Creating Markets from the Ground Up

The Better Life Farming initiative reflects IFC’s commitment to tackling the most challenging issues with technical expertise that can prepare a market for investment. In this case, IFC is providing the technical support to the alliance—offering livelihood assessments the World Bank Group has developed, building on ideas for gender-smart solutions, and providing business training to smallholders. This includes financial literacy and household budgeting skills, which will be delivered to members of farming families.

Better Life Farming pilots are currently underway in India, the Philippines, and Kenya. In India, where the initiative has focused efforts on the green chili crop, yields have already grown by 200 percent, while farmers’ incomes have increased 300 percent. In the Philippines, the pilot program targeted smallholder rice farmers, some of whom reported an increase of nearly 70 percent in revenue between March 2017 and April 2018. Additional pilots in Africa will be supported by the Government of Japan.

As the pilots yield scalable business models, IFC will look at structuring financing solutions, including IFC’s unique blended finance instruments.

Read more about IFC’s work in agribusiness at www.ifc.org/agribusiness

Published in April 2018.