This Spore newsletter article describes progress in the use of information and communication technology (ICT) in the agriculture sector of developing countries, especially in the area of farmers' access to market information. According to the Technical Centre for Agricultural and Rural Cooperation ACP-EU (CTA), mobile phones, emai,l and the internet are strengthening the bargaining power of smallholder farmers, supporting their efforts to sell their produce for the best price.
Because farmers who lack information on markets can be prey for unscrupulous traders, and might waste time and capital transporting goods to uncertain markets, ICT applications can give them the advantage of an overview of market information, as well as access to buyers and transporters via cellphone. "ICTs can help with market research, enabling farmers to make better decisions about what to grow and when to grow it. Efficient market information systems can link producers with buyers even before their crop is harvested - in some cases before the seeds are sown. Big buyers need to know well in advance how much of a certain product they can rely on....In Burkina Faso, Mali and Niger a scheme run by NGO Afrique Verte has launched ICT-based trading exchanges for cereals, so that producers can compare supply and demand in different areas."
E-commerce offers farmers wider trading possibilities including:
- Opportunities for small-scale producers to join up with others through producer organisations to ensure access to ICTs, streamline time-consuming exercises such as market research, and to offer bulk supplies to buyers.
- Opportunities to launch direct marketing campaigns. E-commerce offers opportunities to advertise to a larger audience and sell direct to customers. Information gleaned on the internet can be crucial in enabling producers to understand requirements for export markets, including complex phytosanitary standards.
- Opportunities for detailed market information through market information systems (MIS), some of which provide information via cellphone through short message service (SMS). For example, in Senegal, "the Xam Marsé service launched by Manobi provides information on the prices and availability of fruit, vegetables, meat and poultry at all the country's markets. InfoPrix in Benin offers market prices of the 25 most important staple foods via SMS. In South Africa, the Makuleke Project has set up a virtual trading facility installed on mobile phones so that farmers can sell their produce direct."
These marketing systems vary in detail and quality: "Some give basic information on the price of a given product, while other, more ambitious ones offer details of availability, names and contacts of traders, quantities traded, stocks and even market trends and price forecasts. Second generation MIS that use ICTs are generally based at least partly on private capital as opposed to public funds. They also tend to be wider in scope and scale than their pre-high-tech predecessors, covering far more products and a larger geographical area." For example, in Benin, Burkina Faso, Côte d'Ivoire, Guinea, Niger, Nigeria, Mali, Senegal, and Togo, the RESIMAO/WAMIS-NET network supplies the latest information on 400 rural and urban agricultural commodity markets via the internet, radio, print, email, and SMS.
Two components that enhance ICT-based market systems are two-way communication - allowing farmers contact with traders - and a teaching component, such as the Linking Local Learners (LLL) initiative, which links all those involved in the supply chain - farmers, buyers, transporters, traders, and retailers - and encourages them to learn from each other. Some community-based farmer cooperatives receive market information by mobile phone and meet to interpret it for non-literate members. Some systems focus particularly on women as producers, both in training and in customising market opportunities for their products.
As stated here, access and literacy are barriers to use of ICT marketing systems. Top-down system design and reliability of data are also challenges. Sustainability is a key problem. Most ICT-based services are currently run with donor support, and if operations are to be scaled up, they need to be self-financing. Some systems are approaching advertising as a possible revenue source. Impact studies on the systems are needed since evidence to date is primarily anecdotal. Further, negative consequences, such as the possibility for price fixing, deeper impoverishment of those without access, and loss of essential services such as credit and technical support often provided by middlemen, have not been studied.
Spore CTA Newsletter, No. 140, April 2009.