Smallholder Farmers & Technology

March 29, 2019 5:52 AM

Our recent livestock traceability project exposed us to a variety of challenges that small holder farmers face in sustaining their livelihoods and highlighted the opportunities that exist in empowering this community that constitutes such an enormous part of the global food economy.

There are an estimated 525 million small holder farms globally and they can play an important role in reaching the sustainability goals set by the UN for 2030.

Papua New Guinea farmers are a typical example often having a variety of produce to manage ranging from citrus, coffee, vanilla, sweet potatoes to pigs and chickens.

We found the farmers in PNG open and receptive to change. They had a clear grasp of the challenges within their environment and were keen to explore new approaches and engage with alternative platforms for advancement.

Recent innovations in technology can assist in developing the small holder farmer sector and here we examine some of these applications.

Insurance

Especially in less developed countries insurance is difficult to access, complicated and has long payment cycles that are domplex to navigate for small holder farmers.

Even if a farmer is able to successfully lodge a claim the delay in payments results in the farmer not being able to access finances to invest in the next season.

Tech enablement:

Smart contracts with insurance providers that are integrated with meta data that can validate claim events eg. extreme weather fluctuations and natural disasters. This automates policy payouts and reduces friction in the administration process and speeds up the payment cycle dramatically.

Loans

Many farmers do not have established bank accounts or a way to easily demonstrate their asset base.This limits the availability of loans and access to capital to expand their farms and improve service quality.

Tech enablement:

Blockchain technology has the potential to create a trusted platform for certification and verification of asset holdings. By coordinating with bank loan collateral validation procedures it is possible to more accurately quantify collateral and increase access to a variety of loan instruments.

Blockchain and other mobile app gateways also allow for payments to occur to farmers with no established bank accounts via a variety of payment platforms and cryptocurrencies.

Logistics

Many farmers we met wanted to focus on being farmers but much of their time was spent in handling logistics to bring their produce to the markets or other players in the supply chain. The lack of consistency in remote areas for transport options and the amount of wastage that occurs from damaged goods makes a huge impact on the yields for the farmers.

Tech enablement:

On demand Uber style services that give farmers more options to transport produce and to plan for more economically beneficial transport schedules.

Access to alternative markets

Many farmers have a limited selection of buyers and cannot tap into other markets due to geography or a lack of promotion awareness/options.

Tech enablement:

The introduction of digital exchanges for the buying and selling of produce greatly increases the depth of the market for small holder farmers and also adds to their general awareness and education of market dynamics.

The introduction of certification platforms also opens the door to compliance which leads to the possibility of exporting goods and lifting the brand quality of entire regions or countries.

Middle men

To reach retailers requires running a gauntlet of risks that are expensive and inconsistent for most small holder farmers. The risk for the wholesaler/retailer is reduced if they can be more confident of the productivity of their suppliers and can estimate more accurately the expected outputs so that they can lock in supply and subsequent pricing to the consumer.

All of these steps in the value chain incur fees and when not effectively handled result in a minimal return to the farmer.

Tech enablement:

More effective labelling and tracking devices allow shipments to be traced more accurately and less leakage and more analysis of all components of the produce. This helps in creating more efficient eco systems that alert all players in the system to distortions in the supply chain and assist in maintaining stability in supply and subsequent pricing.

Artificial intelligence combined with beacon technology can be used to predict supply patterns using integrations with a range of related meta data.

Disease outbreaks

One of the reasons many small holder farmers cannot expand their market places is due to the lack of perceived consistency and quality of the produce to more regulated buyers. The levels of compliance are increasing in food supply and many farmers find it difficult to substantiate the practices that they use to enable them to engage with international market places.

Technology enablement:

Blockchain is being increasingly used in a variety of traceability initiatives which can confirm the practices used and also provide a direct and indelible link to the location that produce originates from. This reduces biosecurity risks and promotes trust to the consumer which ultimately stabilizes the market and encourages ongoing growth.

Sharing learning

Education is a major impediment to the development of small holder farmers. Access to resources that are tailored to local environments and the sharing of experiences in remote communities is difficult and historically expensive.

Technology enablement:

Online learning platforms maintained by a network of community cooperatives can provide a vast amount of invaluable information to farmers who can access these repositories via mobile smart phones.

So why are small holder farmers so important to consider?

By visiting these farms we realise that they are largely engaged in wholesome practices that the end consumer is beginning to value more highly. This organic approach to food supply not only provides subsistence to the farmers but also sustains our planet and when approached effectively can result in smarter long term investments in the farming value chain as a whole.

This requires a huge amount of cooperation and we were glad to have worked with the Food and Agricultural Organisation of the United Nations, International Telecommunications Union, Department of Information and Communications Technology, NICTA and Department of Agriculture and Livestock.

Conservation agriculture is a growing movement and can enhance the reputation of retailers while simultaneously discovering more innovative solutions to value chain problems.

We look forward to developing more technology platforms to further enhance the capabilities of the small holder farming sector.