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Good for who? : supermarkets and small farmers in South Africa : a critical review of current approaches to market access for small farmers in developing countries

Thesis (MComm (Agricultural Economics)--University of Stellenbosch, 2010. / ENGLISH ABSTRACT: Small‐scale agriculture is one of the few tools available to support improved rural
livelihoods on a significant scale in South Africa. Access to output markets is a key
obstacle for small farmers in generating higher incomes. Thus, the rise of modern
markets (supermarkets in particular) is generally viewed as positive for the rural
poor, although most commentators accede that there are challenges to be
overcome in obtaining access to such markets. A literature survey indicates a
mainstream point of view about the reasons for modern market exclusion, as well as
the most appropriate policy responses. This viewpoint is characterized by an
assessment that the “fault” for market exclusion lies largely with small producers –
their personal characteristics, their production methods, and their location – rather
than with these markets themselves. The corresponding logic is that if these issues
are addressed small farmers will almost certainly be included in modern market
supply chains.
It is this study’s assertion that much of the research that has been undertaken to
date is in fact incomplete, because it has excluded two key issues: The dominant
supermarket business model; and the actual position of small farmers in those
countries with high levels of supermarket concentration.
An examination of the supermarket model suggests it is inherently hostile towards
most producers, and that modern supermarket supply chain management strategies
aim to maximize the extraction of value from other chain participants. Smaller
producers are particularly hard hit by this strategy. The South African food retail
market structure resembles that of industrialised countries rather than developing
countries, and the largest local supermarkets probably have sufficient market share
to exercise significant market power. Therefore, we should expect that the position
of South African small farmers is similar to that of small farmers in industrialised
countries, who are increasingly excluded by modern supermarket‐led supply chains.
In light of this analysis, most of the current policy initiatives responses to address
market exclusion seem woefully inadequate. Improving the quality of production,
and small farmers’ access to skills and assets is important and necessary, but this
study proposes that these actions on their own are not sufficient to guarantee
access into modern supply chains. Insufficient research attention has been given to
understanding how markets themselves become barriers to entry. This is a vital gap
in local rural development policy: A market system that favours large over small
farmers has the potential to exacerbate rural inequality and to neutralize policy
aimed at supporting small farmers.
Government needs to take the development of marketing opportunities specifically
for small farmers more seriously, understanding that they face a very different set of
market access challenges than do large farmers. They need to encourage and
support the type of food networks and marketing structures that will have the
greatest positive benefit on small farmers and the communities that they live in. This
requires a different view of the workings of market networks, and a more critical
assessment of how these impact on rural livelihoods. / AFRIKAANSE OPSOMMING: Kleinskaalse landbou is een van die min hulpmiddels beskikbaar vir ondersteuning op
beduidende skaal van ’n beter bestaan in landelike Suid‐Afrika. Toegang tot
produksiemarkte is een van die struikelblokke wat kleinboere in die gesig staar
wanneer hulle meer produseer. Die opkoms van moderne markte word algemeen
beskou as positief vir armes op die platteland, alhoewel kommentaar meestal
daarop dui dat daar uitdagings is wat te bowe gekom moet word ten einde toegang
te verkry. ʼn Literatuurstudie dui op ʼn hoofstroomstandpunt ten opsigte van die
redes vir markuitsluiting, asook die mees gepaste beleidsreaksies. Hierdie standpunt
word gekenmerk deur ʼn mening dat die “fout” vir markuitsluiting hoofsaaklik by die
produsente lê – hulle persoonlike eienskappe, hulle produksiemetodes, en hulle
ligging – eerder as by hierdie markte self. Die ooreenstemmende logika is dat, as
kleinboere die gehalte en standvastigheid van hulle produksie verbeter, dan sal hulle
feitlik verseker by moderne markte ingesluit word.
Hierdie studie voer aan dat baie van die navorsing wat tot dusver onderneem is, in
werklikheid onvolledig is, weens die feit dat twee belangrike aangeleenthede: die
dominante supermark‐sakemodel, en die posisie van kleinboere in daardie lande
met hoë vlakke van supermarkkonsentrasie buite rekening gelaat word.
ʼn Ondersoek van die supermarkmodel dui daarop dat dit inherent vyandig is teenoor
die meeste landbouprodusente. In teenstelling met die siening van gelyke vennote
wat in die rigting van ʼn gemeenskaplike doelstelling saamwerk, is die moderne
supermarkvoorraadketting daarop ingestel om soveel moontlik waarde uit ander
deelnemers aan die ketting te trek. Kleiner produsente kry veral swaar as gevolg van
hierdie strategie. Die struktuur van die Suid‐Afrikaanse voedselkleinhandelmark toon
ooreenkomste met dié van geïndustrialiseerde lande eerder as met dié van
ontwikkelende lande, en die grootste plaaslike supermarkte het waarskynlik
voldoende markaandele om aansienlike markkrag uit te oefen. Ons moet dus verwag
dat die posisie van Suid‐Afrikaanse kleinboere soortgelyk is aan dié van kleinboere in
geïndustrialiseerde lande, wat toenemend uitgesluit word as gevolg van
voorraadkettings wat deur moderne supermarkte gelei word.
In die lig van hierdie analise skyn die meeste van die reaksies van die huidige
beleidsinisiatiewe in ’n poging om markuitsluiting die hoof te bied, bedroewend
ontoereikend. Verbetering van die gehalte van produksie en kleinboere se toegang
tot vaardighede en bates is belangrik en nodig, maar is op sigself nie voldoende om
toegang tot moderne voorraadkettings te waarborg nie. Onvoldoende aandag is tot
dusver in navorsing gegee aan begrip van hoe markte self hindernisse op die pad na
toegang word. Dit is ʼn kardinale leemte in plaaslike landelike ontwikkelingsbeleid: ʼn
markstelsel wat groot boere eerder as kleinboere bevoordeel, het die potensiaal om
landelike ongelykheid te vererger en beleid gemik op steun aan kleinboere te
neutraliseer.
Die regering moet die ontwikkeling van bemarkingsgeleenthede – in die besonder vir
kleinboere – ernstiger opneem, en begryp dat laasgenoemde voor baie
andersoortige uitdagings ten opsigte van marktoegang te staan kom as groot boere.
Hulle moet die soort voedselnetwerke en bemarkingstrukture wat die grootste
positiewe voordele vir kleinboere en die gemeenskappe waarin hulle woon sal hê,
aanmoedig en ondersteun. Dit vereis ʼn ander siening van die werking van
marknetwerke, en ʼn meer kritiese waardebepaling van die invloed wat dit op
landelike bestaan het.

Identiferoai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/5236
Date12 1900
CreatorsVan der Heijden, T.
ContributorsVink, N., University of Stellenbosch. Faculty of Agrisciences. Dept. of Agricultural Economics.
PublisherStellenbosch : University of Stellenbosch
Source SetsSouth African National ETD Portal
LanguageEnglish
Detected LanguageUnknown
TypeThesis
Format85 p.
RightsUniversity of Stellenbosch

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