Author: ONE

Ethiopia’s Commodity Exchange: Brewing a win-win solution

Digital screens light up Ethiopia’s small towns, from Assela and Humera to Jima, displaying the real-time prices at the country’s central agriculture market, the Ethiopian Commodity Exchange (ECX). The ECX acts as an organised marketplace where buyers and sellers come together to trade, assured of quality, quantity, payment, and delivery.

Mohamed Abafogi, a farmer from the Jima area of Oromia state, lives more than 300km from the central market in Addis Ababa. Despite the distance, ECX provides Abafogi with the most up-to-date market information and prices, allowing him to sell his coffee beans at the nearby ECX delivery centre at a competitive price with prompt payment. Buyers collect beans directly from farmers like Abafogi at regional centres and transport them by truck to the nearest port, in Djibouti, for export.

“Today I am earning a far better income than before. I am selling my coffee to the people of ECX at a fair price. These days my children do not go to school with empty stomachs,” he said. Last year he was able to replace his straw roof with one of corrugated iron. “I am better off today,” said Abafogi.

ECX assures delivery to buyers and due payment to farmers. Seven years ago, a buyer who paid in counterfeit cheques cheated dozens of Abafogi’s neighbours. Dealers were able to dictate prices to farmers, as there was no competition.

Traders shop for deals at the Ethiopian Commodity Exchange in Addis Ababa. (Pic: AFP)

Samuel Mochona, ECX’s communications manager, said the market had opened up trade since its establishment in 2008 by the Ethiopian government. In addition to coffee, sesame seeds, mung beans, maize, wheat and peas are also traded.

“Before ECX was established, agricultural markets in Ethiopia had been characterised by high costs and high transaction risks. With only one third of output reaching the market, commodity buyers and sellers tended to trade only with those they knew,” he said. “This helped them to avoid cheating sellers and defaulting buyers.

Through ECX, buyers are assured of a quality product, with tests conducted of both raw and roasted coffee samples, while farmers are assured of payment. ECX also gives technical support to farmers, who must meet global quality standards for their coffee to be accepted,” added Mochona.

Thirty-three farmers’ co-operatives, representing 2.6 million coffee farmers, share 15 market seats in the ECX. This gives them permanent and transferable rights to trade on the exchange.

“I can confidently say that trends in this country vividly show that ECX is successful not only in increasing the income of the poor farmers from coffee sell, but contributes to general economic development,” said Abenet Bekele, ECX chief strategy officer. “At present, however, no calculations have been made of the net benefit to farmers.”

Coffee production
Around one fifth of Ethiopia’s population depends directly or indirectly on coffee production and trade. Coffee earned almost 25% of total foreign exchange in the country in 2012/3 and accounts for 2% of GDP, according to the Ethiopian Commodity Exchange Agency, the government body overseeing ECX.

“I don’t have words to explain the stark contrast in lifestyle in my family and my neighbourhood before and after the coming of ECX. Previously, I could only afford to send one of my three boys to school as the remaining two had to work. But now all are in school,” said Abafogi. He now plans to establish a flourmill, which will be run by his wife.

“Improvements in agriculture, like ECX, can make an enormous difference in the lives of smallholder farmers,” said Dr Sipho Moyo, Africa Director of ONE.org. She further explains that providing resources like these can boost farmer incomes and break the cycle of poverty and that investing in agriculture now could help lift tens of millions of people out of poverty by 2024.

In January, ONE.org formally launched the Do Agric, It Pays campaign, based on its report, Ripe for Change: The Promise of Africa’s Agricultural Transformation, which calls on African governments to implement an enhanced CAADP (Comprehensive Africa Agriculture Development Programme) framework.

The enhanced CAADP policies were developed after a lengthy consultation process with African farmers and farmers associations from all over the continent. The package of policy recommendations include eliminating the gender gap in agriculture, developing the value chain to benefit small holder farmers, and making time-bound commitments to spending at least 10% of national budgets on agriculture investments, amongst others.

Taddese Meskela, head of the Oromia Coffee Farmers’ Co-operative, says ECX plays a pivotal role in ensuring fair prices for farmers and supplying quality coffee to global markets.

“Our members’ income is continuously growing as they are getting due prices for their produce,” he said.

Girmaye Kebede for ONE.org.

11 years ago

More support needed for SA’s community food gardens

Community food gardens can provide an important tool for household sustainability in South Africa, where less than half the population is food secure and 12 million people go hungry every day.

“I now have food to put on the table every day of the week,” says Sibongile Sityebi from Cape Town’s Gugulethu township. “I did not have that before. I was unemployed and did not have money to buy healthy food.”

For the past five years, Sityebi has worked at the Asande Food Garden in Gugulethu, an initiative of non-profit organisation Abalimi Bezekhaya. Meaning “Farmers of Home”, this Cape Town-based organisation encourages local township residents to grow their own vegetables. The objective is for these farmers to feed themselves, their families and the community.

Community members pack vegetables at Harvest for Hope community garden. (Pic: Alexandra Farrington)

Food insecurity remains a widespread problem across Cape Town and the rest of South Africa. According to a study by the African Food Security Unit Network at the University of Cape Town (UCT), 12 million South Africans – almost 25% of the population – go hungry on a daily basis. This figure excludes individuals who are at risk of being hungry, which is another 25%. Food security has declined over the past five years, with only 45.4% of South Africans categorised as “food secure” in 2012, compared to 48% in 2008, according to the Human Science Research Council and the Medical Research Council.

Sityebi, who is now leading Asande and managing three other farmers, says community vegetable gardens can bring much-needed relief.

“The gardens of Abalimi make food insecurity in our areas a bit better,” the farmer says. “People here don’t have enough money for healthy food. We at Asande for instance donate part of our produce to soup kitchens and give it away to people who have nothing.”

It is difficult to determine exactly how many South Africans benefit from food gardens, as comprehensive figures are not available. A quick Google search however shows that there are many hundreds of community vegetable initiatives scattered across the country, from Cape Town to Johannesburg, from Bloemfontein to Durban.

Abalimi’s impact is easier to calculate, with 200 food gardens. Each of these are tended by five micro-farmers each supporting between five and seven people – the size of an average household. This means that a minimum of 10 000 people directly benefit from Abalimi gardens, excluding thousands of residents in neighbouring areas who are now able to access affordable and healthy food.

“Twenty-five percent to 50% of Abalimi’s output is consumed locally, by the farmers and their dependents as well as their fellow community members,” says Abalimi co-founder Rob Small, adding that the gardens grow a wide variety of seasonal crops. “These are people whom are most affected by food insecurity. The rest is sold to more affluent consumers as well as some retailers. This is what keeps our operations going.”

The gardens’ impact on farmers’ health has been significant. “The universal response of our farmers is is that they felt desperate and unhealthy when they started and healthy and empowered after being with us for a few months,” Small says. “Our farmers love the food they are eating and the fact they are working outside. People are less sick, and have fewer doctors’ bills. They feel psychologically better and more dignified. Community vegetable gardens, in other words, definitely have a positive impact on food security – and on overall well-being.”

University of the Western Cape graduate Marc Lewis agrees. Last year he did extensive research on the positive impact of urban vegetable gardens and food security in Johannesburg for his master’s degree at the university.

“When initiated and run properly, vegetable gardens can improve food security at household and community level,” he says, adding that the gardens he looked at alleviated food insecurity in two ways: by providing food for the farmers and by selling produce straight to the community at much lower prices than produce available in the shops. “This is where healthy affordable food is needed the most.”

Support from other stakeholders, such as the government, municipalities, corporates and non-governmental organisations, can be a critical success factor for gardens, particularly for access to land and water. International NGO, ONE.org recently launched a new pan-African campaign known as Do Agric, It Pays, calling for more and better investment in agriculture by African governments. ONE.org’s executive director for Africa, Dr Sipho S. Moyo states that better structured support for small holder farmers and their needs, such as irrigation and access to land, is essential not only in combating poverty, but also in assuring sustainable economic development. Such investments could help further transform South Africa’s community gardens and multiply the gains.

“In 2003, African leaders pledged to invest 10% of their national budgets in agriculture – only eight of them have kept that promise. Do Agric, It Pays calls on governments to not only meet this promise, but to implement policies that are targeted towards protecting and promoting small holder farmers, leveling he field for women, and developing the value chain, among others. The private sector cannot do it alone. In countries such as Burkina Faso and Ethiopia, the government has come to the aid of the private sector with targeted investments in agriculture, and the results hav been significant in terms of poverty alleviation, job creation and overall economic development.”

“Some of the gardens I studied had free water access,” Lewis says, adding that good management of gardens and resources is important. He stresses that someone needs to take control to prevent initiatives to become fragmented.

“Lastly, community gardens should be informal market, and not formal market, orientated,” he says. “It is in the communities in which these farms operate where good and healthy food is needed the most. The market is solid.”

Miriam Mannak for ONE.org

11 years ago

It’s time for African leaders to invest in agriculture

The African Union has declared 2014 the Year of Agriculture and Food Security, recognising that this is the issue of our time.

In January 2014, ONE and its partners launched the “Do Agric, It Pays” campaign at the AU Summit in Addis Ababa. Through this campaign we are asking African leaders to invest in our farmers, our food and our futures.

The 2003 Maputo Declaration was supposed to ensure that Africa could feed itself and that poverty was reduced through investment in agriculture. However, only eight countries have so far met their commitments by spending 10% of their national budgets on agriculture.

In sub-Saharan Africa, agriculture growth is 11 times more powerful in reducing poverty, according to the Food and Agriculture Organisation’s director general, José Graziano da Silva. By investing in agriculture, we can lift hundreds of millions of Africans out of poverty, provide jobs and boost the continent’s economy by 2024.

We know that this is achievable, as Africa holds 60% of the remaining global arable land and so can potentially not only feed itself but the rest of the world too. While smallholder farmers produce 80% of the continent’s food, it is ironic that this sector of the population also bears the brunt of rural poverty. Our governments can facilitate access to the resources that smallholders need to thrive by implementing smart targeted policies and public spending designed to benefit those who derive their livelihood from agriculture.

Improved irrigation, farming equipment, storage, market access, and women’s land rights would mean brighter futures for millions. Equally key to their success is access to credit, quality inputs and extension services and training. Public investment in agriculture – as in Europe, the United States, Brazil and China – not only allows for inclusive development as it promotes the development of the value chains but is also a catalyst for private investment and participation in the agriculture sector.

Farmers’ stories
Over the past months, ONE has been working with like-minded partners including farmers organisations and associations across the continent to mobilise and collect signatures from hundreds of thousands of African citizens who are demanding that their leaders step up to the Maputo challenge and “do agric”. We are therefore listening to what farmers are saying, and relaying their stories to governments across the continent.

Adam Yakubu, a cocoa farmer from Ghana, says that transportation has to improve. “You will harvest your product and it will stay at the roadside for a week. Sometimes the food perishes before it gets to the market. And when you get to the market, the pricing kills your soul,” he says.

“It’s not easy. You don’t get income daily, sometimes it’s a yearly affair. Sometimes you have to go on borrowing so [that even] before production begins you are already in debt.”

Maria, a sweet potato farmer from Tanzania, was able to receive training in soil irrigation, crop multiplication, and dividing vines. As a result, she has been able to grow orange sweet potatoes, which are high in vitamin A. “I work happily knowing I will be getting out of poverty by doing what I am doing. I am now a leader in my farming group and teach others what I have learnt,” she says.

In Benin, a high-level agriculture policy forum was organised by ONE and the Beninese National Platform of CSO Actors (PASCiB) in order to boost dialogue between government, farmers’ representatives, civil society organisations, donors and the private sector. This resulted in the Cotonou Consensus ,a policy strategy plan signed this year and already implementing action to the identified national priorities according to the agreed action plan and timelines.Benin seeks to become an agriculture champion and the rest of Africa should too.

We’ve also launched one of Africa’s largest musical collaborations to date, Cocoa na Chocolate, featuring 19 of the continent’s top recording artists. D’Banj and Femi Kuti from Nigeria, DR Congo’s Fally Ipupa, Côte d’Ivoire’s Tiken Jah Fakoly, Kenya’s Juliani and Victoria Kimani, and South Africa’s Judith Sephuma, among others, have come together to help rebrand agriculture and tell African youth that their future lies beneath their feet and in their hands.

Their voices, in support of African agriculture, are sending a powerful message to the young generation: it’s time for African leaders to scale up public investments in agriculture and ensure policy interventions are targeted to benefit smallholder farmers.

Be part of ONE’s campaign to transform agriculture in Africa by signing the Do Agric petition.

Dr Sipho S. Moyo is Africa director for ONE.