This paper provides an overview of agricultural cooperatives versus model farmers in the malting barley value chain in Ethiopia. In Ethiopia, per capita beer consumption increased by 20% annually. Thus, the increase in beer demand invited the emergence of multiple foreign beer factories towards the beer production that opened the door for malt barley contract farming. Malt barley contract farming was firstly introduced by Diageo followed by Heineken beer companies. Along the value chain of malt barley contract farming, agricultural cooperatives and model farmers are known chain actors. While some literature reveals the positive outcome of agricultural cooperatives in other agricultural activities, others verify agricultural cooperatives as the ineffective one.
Table of Contents
1. INTRODUCTION
1.2. Statement of the Problem
2.1. Contract Farming and Drivers for Contract Farming
2.2. Drivers for firms
2.3. Drivers for Smallholder Farmers
2.4. Debates on Contract Farming
2.5. The Model Farmers and History of Model farmers in Ethiopia
2.6. Agricultural Cooperatives and History of Agricultural Cooperatives in Ethiopia
2.7. The essence of Political Economy
2.8. The Political Economy of Model Farmers and Agricultural Cooperatives
3. THEORETICAL FRAMEWORKS OF MODEL FARMERS AND AGRICULTURAL COOPERATIVES IN MALT BARLEY CONTRACT FARMING
4. PERFORMANCES OF MODEL FARMERS VERSUS AGRICULTURAL COOPERATIVES IN MALT BARLEY CONTRACT FARMING
4.1. Case studies on effectiveness of Model farmers versus Agricultural Cooperatives
Malt Barley contract farming
5. CONCLUSION
Objectives and Core Themes
This seminar paper investigates the comparative effectiveness of agricultural cooperatives versus model farmers within the malt barley contract farming value chain in Ethiopia. It aims to analyze performance metrics such as service delivery, input distribution, and social capital, while simultaneously examining the political economy that influences the roles and operations of these two distinct actor types.
- Performance comparison of model farmers and agricultural cooperatives.
- Impact of contract farming on malt barley production and market access.
- Influence of political economy on cooperative management and farmer selection.
- Evaluation of institutional barriers and success factors in value chain participation.
Excerpt from the Book
4. Performances of Model farmers versus Agricultural Cooperatives In Malt barley contract farming
Barley is a staple crop. In Ethiopia, it is mainly grown in the Oromiya highlands (Arsi and Shoa) and Amhara regions. Currently, owing to the pervasive investment in brewery companies, it represents as one source of cash income. About 53% of barley production is from Oromiya region, while 30% is from Amhara region. Production is 95% rain-fed with 5% on irrigated land so that production is weather driven. It accounts for 6% of per capita calorie consumption. In 2016/17 Meher (rainy season), about 4.2 million smallholders allocated 960,000 hectares of farm land to barley cultivation. As production, two million metric tons was produced (CSA, 2017). Ethiopia is the second producer and the largest consumer of barley in the African continent next to Morocco, accounting for about 26% of the total barley production in the continent (Rashid et al., 2015). Nationally, two types of barley are grown: food barley for home consumption and malt barley as cash industrial crop for brewing. The quality and production requirements are not the same for the two kinds of barley. For production of beer, malt barley grains need to meet specific requirements of standard, such as appropriate content of protein and level of moisture, germination ability, specific grain size, purity, etc. Driven by rising income and increased urbanization, per capita beer consumption in Ethiopia has grown rapidly at an annual rate of 20% (ATA, 2015).
Summary of Chapters
1. INTRODUCTION: Outlines the significance of the malt barley value chain in Ethiopia and the research gap regarding the comparative roles of cooperatives and model farmers.
2. CONCEPTS OF CONTRACT FARMING, MODEL FARMERS AND AGRICULTURAL COOPERATIVES: Provides theoretical foundations and historical context for contract farming, the evolution of the model farmer approach, and the development of agricultural cooperatives in Ethiopia.
3. THEORETICAL FRAMEWORKS OF MODEL FARMERS AND AGRICULTURAL COOPERATIVES IN MALT BARLEY CONTRACT FARMING: Discusses the government's development policies, such as the Growth and Transformation Plan and the Agricultural Commercialization Cluster, which underpin current malt barley initiatives.
4. PERFORMANCES OF MODEL FARMERS VERSUS AGRICULTURAL COOPERATIVES IN MALT BARLEY CONTRACT FARMING: Examines empirical evidence regarding the operational advantages and disadvantages of model farmers versus cooperatives in service delivery and input distribution.
5. CONCLUSION: Synthesizes the findings, highlighting that while model farmers often outperform cooperatives in efficiency, both are deeply embedded in and influenced by the prevailing political economy.
Keywords
Malt barley, Contract farming, Ethiopia, Model farmers, Agricultural cooperatives, Value chain, Beer industry, Smallholder farmers, Agricultural extension, Political economy, Input distribution, Market access, Productivity, Agribusiness, Institutional development.
Frequently Asked Questions
What is the central focus of this research paper?
The paper examines the comparative performance of model farmers and agricultural cooperatives within the Ethiopian malt barley contract farming sector and analyzes the political and economic forces affecting them.
What are the key themes addressed in the work?
Central themes include the effectiveness of different intermediaries in value chains, the impact of government extension strategies, and the influence of political ideology on farmer-based organizations.
What is the primary objective of this study?
The primary goal is to unveil the comparative advantages and shortcomings of model farmers versus agricultural cooperatives in terms of service provision and market integration for malt barley.
Which scientific methods are utilized?
The research is based on an extensive literature review and synthesis of existing case studies, performance reports, and policy documents regarding Ethiopian agriculture.
What does the main body of the work cover?
The main body details the historical background of these actors, their theoretical framework within national development plans, and their practical performance in malt barley supply chains.
Which keywords characterize this paper?
Key terms include malt barley, contract farming, Ethiopia, model farmers, agricultural cooperatives, value chain, and political economy.
How does political pressure impact the performance of these actors?
The study notes that cooperatives are often subject to "hidden hand" pressure from the government, which affects their management and efficiency, while model farmers are sometimes utilized for political mobilization.
Why are model farmers often considered more effective than cooperatives?
Model farmers are generally perceived as having better financial capital, entrepreneurial acumen, and are more proactive in adopting and disseminating innovative agricultural practices.
What role do beer companies play in these contract farming arrangements?
Foreign beer companies drive the malt barley value chain by setting quality standards and collaborating with intermediaries (cooperatives and model farmers) to secure a consistent raw material supply.
What are the challenges for agricultural cooperatives in this value chain?
Cooperatives frequently face issues such as late input distribution, limited working capital, lack of transparency, and bureaucratic delays in payment, which hinder their performance.
- Quote paper
- Tesfa Sisay (Author), 2021, Agricultural Cooperatives versus Model Farmers in the Malt Barley Value Chain in Ethiopia, Munich, GRIN Verlag, https://www.grin.com/document/1162483
