Saturday, June 23, 2012

62 - Value chains from scratch

In general value chains do not exist in small communities, in the agricultural communities in remote areas of our country. And if a value chain exists it is most likely small, not very strong, and does not support the whole community.

There may be a small store where the farmer can buy seeds and fertilizer. And this store is probably the same one where the farmer sells its product. This store may provide some services but not all or not enough.

In small communities this creates a situation of dependency which is not good in the long run and is very vulnerable to price fluctuations.

If only a small community could produce more of the things that it needs then its dependency in the small store will be reduced and the community will be stronger because of that.

Let us look at an example. A farmer may sell beans to the store and buy seeds and fertilizer from the store and maybe this will be fine. But where will the community buy clothes, or cooking oil, or soap, or meat, or vegetables? Most likely from the same store which will only increase its dependency and its vulnerability to changes in prices and availability of any of the products.
But if someone plants peanuts and starts making cooking oil from these peanuts then the community will be less dependent on the store and someone will now have a new activity where money can be made. 

And if someone gets some of the cooking oil uses ash from the cooking fires and makes soap then that person now has another new money making activity and the community will become less dependent on the local store. That person can actually sell some of the soap to the store.

In this small example where someone plants peanuts for food but also for cooking oil which will be used for cooking but some will also be used to make soap. Three people now created a value chain to which we can add someone who will go once a week to the city market and sell some of the peanuts, the cooking oil and the soap that the community does not need for itself.   

There are many value chains in an agricultural community. Some we already use but some can be developed. The result will be beneficial to all in that hard working community.

Let us look at some more value chains in the upcoming blogs.

No comments:

Post a Comment