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Kenyan Kale Farmers Upgrade Physical and Human Capital
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Morley, David - The Cambridge introduction to creative writing (2011) - libgen.li
| Kenyan Kale Farmers Upgrade Physical and Human Capital to Supply Supermarkets The example of kale farmers in Kenya illustrates the implications of supplying supermarkets as opposed to distributing the product through traditional channels. Although the supermarket buyers in Kenya are mostly domestic, the transition required by farmers to qualify as suppliers involves upgrading human and physical capital. Kale is a useful example because it is the most widely grown and consumed vegetable in Kenya, and because it is a relatively labor-intensive crop with reliable yield and low market price, making it common among smallholder farmers. Farms supplying kale to supermarkets achieve higher land and labor productivity rates than farms supplying brokers, wholesalers, or retailers. For land productivity, the difference between the two groups is 59 percent, while the corresponding figure for labor productivity is 73 percent. These differences are due to the fact that farms selling to supermarkets are larger, use an average of twice the amount of inputs per unit of land, and incur higher variable costs in the form of tractor rentals and irrigation operating expenses. Their share of irrigated land in total land under cultivation is almost four times higher than in the case of other farms. For instance, while only 5 percent of traditional farms have electricity, this is true of all farms supplying supermarkets. Similar differences can be found with respect to having a phone line or a transportation vehicle. Producers selling to supermarkets have higher profits, pay 25 percent higher wages, and enjoy greater revenue stability than traditional-channel farms. Meeting the higher standards for food safety, quality, and other delivery conditions requires additional human capital. The average education of workers on farms supplying supermarkets is 13 years of schooling, which is almost twice the 7 years obtained by workers on traditional-channel farms. The vast majority of workers in the latter scenario are family members, whereas the opposite is true for supermarket chain suppliers. Source: Neven 2004. 06-Chap6:06-Chap6 10/9/06 2:39 PM Page 335 336 AFRICA ’ S SILK ROAD : CHINA AND INDIA ’ S NEW ECONOMIC FRONTIER marginalized by higher standards imposed by food importers on premium suppliers suppliers would need to bear the costs to provide the necessary training and oversight to a large number of small growers. Indeed, working with smallholder farmers is difficult for trading and processing companies. Quantities of products are small and heterogeneous in quality, supply can be haphazard, and bulking-up of volume into a steady stream of product of constant quality is difficult to achieve. Other weaknesses of smallholder farmers are the lack of knowledge of modern markets, technologies, and inputs, and poor access to capital, which prevents them from upgrading their production. These factors constitute a serious constraint to supplying high-end modern supply chains. In fact, the share of smallholder farmers (and medium-scale growers) in Kenya has decreased over the past decade, although the absolute volume of smallholder-produced vegetables for export is approximately the same. 43 Download 5.17 Mb. Share with your friends:
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