Smallholder integration in changing food markets
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Closing the gap between actual and potential yields of food staple crops is increasingly recognized as critical for meeting future global food needs and for containing food price increases. Paradoxically, the evidence suggests that supply is relatively unresponsive to higher food prices where there is greatest technical potential for raising levels of productivity: smallholder agriculture in developing countries. Efforts to increase research and development as a basis for improved levels of pr oductivity have limited success at promoting a significant supply response to high food prices unless smallholders’ participation in food markets is strengthened. However, neither smallholders nor markets are homogenous. Smallholders face widely different sets of constraints to both their ability and their willingness to increase production for sale in a broad range of markets, many of which change in terms of their access requirements through time. As a result, policy makers are faced with s ignificant challenges in their attempts at creating conditions that are conducive to a widespread adoption of technologies and practices required to increase production. This report examines the reasons for, and implications of, heterogeneity in smallholder market participation. It introduces examples of solutions that may be appropriate in facilitating increased levels of market participation in rapidly changing food markets and illustrates the importance of better accounting for smallhol der heterogeneity in the design of policy and support measures that will be needed in promoting increases in marketable surplus from these producers.