Food Security and a Holistic Finance for Rural Markets

Abstract

Investments in agriculture, particularly in smallholder agriculture in developing countries, are regarded as critical for meeting the food demands of a growing world population. 3 Improvements in agricultural finance, mainly in providing investment credit to farmers, are widely regarded as an important approach to stimulate production. 4 While this is certainly true, it is only part of the story. Agriculture-related physical and market infrastructure have been widely neglected in the discussion despite their immense relevance for making food available in developing countries-and as a precondition for farmers to produce at all. In this chapter, we describe the investment and financing needs of every step in the food production and distribution chain: from farm to fork, from pasture to plate, or from barnyard to belly. Take your pick. 1 Commercialisation of Farming as an Opportunity The global economic framework for agricultural production has changed significantly in recent years. Most importantly, after decades of stagnating commodity prices, prices for agricultural produce, processed as well as non-processed, have significantly increased and are expected to increase further. Population growth and increased demand for high-value food products-particularly in the big emerging markets-are the underlying factors that indicate a continuing challenge. 5 This

Agricultural value chain participation and farmers' access to credit in northern Ghana

“…Lenders' criteria for advancing credit are mainly tied to the educational level, nature (size) of the farm business, cash flow, account turnovers, familiarity with the potential borrower and how the loan affects farmers' outputs, among others. The approach does not consider contractual arrangements between farmers and off-takers to buy farm produce, which negatively affects farmers' loan repayment (Köhn, 2014; Luan and Kingsbury, 2019).…”

“…In South Africa, Oberholster et al. (2015) examined the factors that promote the success of financial flows through the value chain, while Köhn (2014) assessed farmers' motivation for participating in AVCs. All these studies did not account for selection bias and treatment effects that are very likely to be associated with these variables.…”

Assessment of risk attitudes of smallholder farmers in south-west, Nigeria

“…These forces of nature exposes agricultural production to much risk: both weather shocks and unpredictable pest damages and in turn affect farm production. Agricultural activities are more susceptible to the physical and natural uncertainties than other enterprises (Kohn, 2014). Obviously, the reactions of farmers to unpredictable agricultural conditions are known as Farmers' Risk Attitudes.…”