A study conducted by Duke University’s Center on Globalization, Governance & Competitiveness for the Multilateral Investment Bank (MIF) of the Inter-American Development Bank (IDB) reveals excellent opportunities for small and medium-sized producers to access high-value international markets.

Producers can contact several organizations that offer information, tools and resources to improve these aspects

However, the main obstacle for producers is the lack of information and support mechanisms to access the global high-value chains.

What are high-value agro-food chains?

According to this publication, they are agricultural commodities that require special handling, such as fresh fruits and vegetables, or are processed in one or more post-harvest stages - such as specialty coffee or honey - prior to reaching the end market. These products tend to be more significantly labor intensive than cereal crops and other traditional agriculture, largely because mechanization is complicated by the need to prevent damage to fragile produce.

They are usually subject to a series of sanitary and phytosanitary regulations to ensure food safety and quality and to prevent the spread of disease. Therefore, these products yield higher prices and can provide an attractive source of income for producers.

The fact is that small and medium-sized producers have the opportunity of participating in global high-value chains. The research describes how producers can fill specific production gaps in the chain more efficiently than mechanized agriculture.

• Labor-capital intensity ratio: smallholders can compete in crops in which they have comparative advantage over large producers due to labor intensity. Although small producers may have higher capital costs, they generally have lower labor costs, potentially outweighing economies of scale of large producers.

• Commercial viability: to access high-value chains the crop produced must have an existing and strong international market demand.

According to the Multilateral Investment Fund, due to broad geographic, cultural and educational factors many small producers do not have the required networks to establish these relationships with potential buyers. Unorganized small and medium-sized producers do not generally participate in international fairs, have websites or generate publicity.    

Often, they do not even know that there is a potential market for their products or what requirements potential buyers may have. Let alone how to establish formal sourcing contracts or product quality standards. 

While many small and medium-sized producers have worked in agriculture their entire lives, specific training is required to improve productivity and product quality. Training in new technologies and plant varieties and in certification requirements that govern entry into the high-value chains is also important. 

How can this be done? Producers can contact several organizations that offer information, tools and resources to improve these aspects. For example, industry chambers or business organizations offer training and workshops to help producers access high-value chains. Also, forming part of a cooperative or an outgrower scheme can be of great assistance for those seeking training in the latest technologies and trends; and also ensures links with buyers.