New marketing channels for food quality products in Norway

Marketing is an important and challenging competitive instrument for small-scale quality food producers. Traditional commercial channels may be unprofitable and small-scale food producers often lack access to a highly concentrated retail sector. In this situation a number of strategic alliances between farmers and between farmers and other public and private actors have emerged. The aim of this paper is to discuss and compare initiatives to develop alternative marketing channels for small-scale specialty food producers. The three examples of emerging channels we investigate are (i) the 'new' farmers markets, (ii) retail initiatives where local producers deliver their produce directly to shops, and (iii) companies founded by large cooperatives to market specialty products. Recent research has justified that such initiatives can be conceptualized as hybrid governance structures, i.e. complex structures that entail properties of both market and hierarchy. We pay particular attention to the problem of quality enforcement in emerging marketing channels.     

The complexity of exchange: Wheat markets,petty‐commodity producers and the emergence of commercial capital in colonial Punjab

This paper questions the orthodox Marxist view of merchant capital as “unproductive,” by highlighting the importance of traders in subsuming the countryside to the logic of capital. However, it also argues that in order to properly understand the role played by traders in agrarian change, critical Marxist scholarship on merchant capital needs to recognize the complex marketing systems in which traders and farmers operate. These markets have their own internal relations, organizational and institutional logic which in turn is tied to the specificity of the commodity. Using wheat markets in colonial Punjab as a case study, it then utilizes the framework of complex marketing systems to highlight the range of firms and farms that operated in these markets; the importance of personal relations and informal institutions of family, caste, and religion for establishing trust; and the class stratified nature of market participants. It was from within these informally organized markets that commercial capital first emerged in colonial Punjab. By creatively combining the concept of commercial capital with markets as complex systems, it hopes to provide a richer framework for the study of agrarian change in diverse contexts.     

Structure and Dynamics of Livestock Marketing in Rural Uganda: Constraints and Prospects for Research and Development

ABSTRACT

The projected global expansion in consumption of meat and other livestock products potentially offers sub-Saharan African small-holder farmers opportunities to escape from the poverty trap. A necessary condition for exploiting this potential is the establishment of marketing systems that provide farmers with reasonable incentives to participate in the market. In this study, the functioning of livestock markets in rural Uganda is analyzed based on a survey of 401 livestock keepers, complimented with focus group discussions with livestock traders and policy planners. The first part is dedicated to the empirical analysis of key organizational and institutional arrangements. Constraints along the marketing chain as well as potential institutional solutions are illuminated. The second part is dedicated to propositions of new areas where more work and new results are needed to improve the functioning of the livestock marketing chain. Empirical findings indicated the following institutional constraints: a poor market information system, lack of grades and standards, lack of trade finance, poor contract enforcement and dispute settlement, disorganized actors, high transaction risks, and poorly developed marketing infrastructure. The study recommends a structured approach to livestock marketing, market infrastructure development, and emphasis on arbitration systems as specific ways of improving the efficiency of livestock marketing in Uganda and other developing countries.     

MARKETING MANAGEMENT AND THE FARMER

Agricultural marketing in the United Kingdom has been particularly topical over the last two years. A great deal of publicity has been given to the desirability of agricultural producers improving their marketing skills, with considerable support for this view coming from successive Ministers of Agriculture. However, it appears that farmers remain sceptical, and, in fact, little is known about the importance of marketing in the overall management of the farm. This paper analyses the importance of marketing management to the individual farmer, using the results of research designed specifically to investigate the use of marketing principles at the farm level.     

Formal and informal contract farming in Mozambique: Socially embedded relations of agricultural intensification

This paper explores the role of contract farming arrangements in agricultural intensification in sub-Saharan Africa, combining secondary literature and original case material from Mozambique. The paper extends the scope of “contract farming” beyond the formal contracts between large companies and small-scale producers to include less formal credit agreements between farmers and traders. It argues that such informal contract arrangements are evidence of farmers' agency in “real markets.” In the studied cases, farmers use contract farming opportunities to intensify agricultural production by investing in irrigation and inputs. While informal contracts typically concern locally consumed crops, thus with more possibilities for side selling than formal contracts for export crops with company-controlled markets, informal contract compliance reflects closely knit social ties between the contracting parties. In both formal and informal contracts, purchasers tend to seek out producers who are already irrigating, thus obtaining gains from farmers' earlier investments. This also implies contract farming as a mechanism for accelerating social differentiation arising from unequal access to irrigation. The paper argues that the significance of informal contracts in the studied cases raises the possibility that informal contract farming by local traders plays a more important role in agrarian transformation in Africa than formal contract farming by large companies.     

A test of whether millet acreage in Niger is determined by official or private market prices

Niger has two separate marketing channels for grain: one is the official system operated by the government; the other is a parallel channel of private traders. Researchers or policy-makers wanting to study effects of price policies on producers are faced with two sets of prices. This paper seeks to answer the question, which prices matter? Non-nested hypothesis tests are conducted for millet-acreage response equations. The results show that prices from the larger private market are the prices that matter.     

Selling at the Farmgate or Traveling to Market

Using detailed survey data from Uganda, this article examines whether coffee producers sell to itinerant traders or directly to markets, where they can get a higher price but must incur a transport cost. We find that selling to the market is more likely when the quantity sold is large and the market is close by. Wealthy farmers are less likely to sell to the market, possibly because the shadow value of their time is higher. But if they have a large quantity of coffee for sale, they are more likely to sell it to the market. They are also more likely to travel to a distant market. These findings are consistent with their better ability to pay for public transportation. We find no evidence that the decision to sell at the farmgate is driven by a self-control motive.     

Descriptive Analysis of Saskatchewan Organic Producers

A total of 69 Saskatchewan organic producers were surveyed in the spring of 1991. Although Saskatchewan organic farming represents a move toward an alternative conventional system of agriculture it is not a complete reversal from conventional practices. Saskatchewan organic farmers are experimenting with highly integrated systems which incorporate green manure crops and soil testing and require high management and marketing skills. In a study of then-goals and objectives using fuzzy sets, environment and healthy food were ranked above farm survival. This leads to the conclusion that most organic farmers do not adopt organic practices based on purely economic criteria but on higher goals within their own hierarchy.     

Spatial and Temporal Marketing Considerations under Marketing Loan Programs

Marketing assistance loan (MAL) and loan deficiency payment (LDP) programs differ in their treatment of transportation costs. Marketing decisions are analyzed under these programs when producers are differentiated by location with respect to the terminal market. Under certain conditions, a complete characterization of equilibrium is developed. The proposed model broadly fits several "stylized" facts about producer enrollment in these programs. If LDPs are uniform at all locations, LDP programs do not interfere with marketing decisions. MAL programs distort the optimal marketing pattern by providing incentives to store for producers who should be among the first ones to supply the market.     

INTER-GENERATIONAL TRANSFERS IN THE RURAL SECTOR: A REVIEW OF SOME PROBLEMS

Three kinds of inter-generational transfer are discussed. Despite the obvious advantages of partnerships and other forms of income splitting from the income tax viewpoint, about half of the primary producers in Australia continue to operate their businesses as sole traders. Some of the problems which arise with partnerships, trusts and companies in this regard are considered. The transfer of the ownership of the assets in addition to the ownership of the income stream they generate, is then considered in detail. The taxation of this transfer by means of gift and death duties raises many questions in relation to economic equity and efficiency. The third type of inter-generational transfer discussed in this paper is the transfer of the managerial role. Several suggestions are made which could help not only to reduce the family trauma which usually surrounds this issue, but which also could help reduce the tendency for farmers to hold the reins for too long.     

Getting Institutions "Right" for Whom? Credit Constraints and the Impact of Property Rights on the Quantity and Composition of Investment

Property rights reform is typically hypothesized to boost investment through investment demand and credit supply effects. Yet when the credit supply effect is muted, property rights reform would be expected to induce liquidity-constrained farms to reduce investment in movable capital even as they increase investment in attached capital. This expectation is corroborated by econometric analysis of panel data from Paraguay. While all farmers experience a positive investment demand effect, liquidity-constrained producers correspondingly reduce their demand for movable capital. Given an estimated pattern of wealth-biased liquidity constraints, property rights reform will get institutions "right" for only wealthier producers.     

Analyzing the Demand for New Value-Added Product: Case of Pure Blueberry Sweetener

Analyzing the demand for a new product that is not on the market presents challenges as agricultural producers search for potential value-added products and develop marketing strategies for these products. This study examines the market potential for a new pure blueberry sweetener in Kentucky. The results from a contingent choice survey indicate that the average respondent was not willing to pay a significantly positive amount for the product. However, a small group of respondents, who can be identified by their overall blueberry purchasing intentions and age, was willing to pay a price higher than the product's cost of production. Small and medium-size producers who are often limited by the financial and technical constraints associated with actual market trials of new products are likely to find that the type of marketing research described here is a particularly cost-effective method of getting information to assess market potential.     

Cash Marketing Styles and Performance Persistence

Much agricultural economics research has been dedicated to determining the best time for producers to sell their commodities. Unlike this past research, we look at how producers actually sell commodities. The extent to which producers display an active or mechanical marketing style is measured using individual farmer sales. The activeness of a producer's marketing strategy is measured by how much the timing of their strategy varies from year to year. Results show no relationship between activeness and net prices received. Furthermore, the results show no evidence of performance persistence by individual producers.     

Formation and adaptation of reference prices in grain marketing: an experimental study

This study aimed to explore how producers’ reference prices are formed and adapt over time, and how they affect marketing decisions. Results indicate that producers focus on three major variables to form their reference prices: the current market price, the highest price to date, and their expectation about price behavior. Further, they update their reference prices during the marketing season mainly in response to changes in current market prices, their own expectations about price behavior, and the general price trend. Finally, our findings suggest that producers’ marketing decisions are based on the spread between current market price and reference price, the general market trend and price expectation.     

On the Demand for Information Services: An Application to Lowbush Blueberry Producers in Eastern Canada

Information needs have rapidly evolved in agricultural markets but little is known about how information is transmitted to agricultural producers. Producers must collect information to better manage their production, marketing and financial decisions. Using survey data obtained from a questionnaire distributed to lowbush blueberry producers in eastern Canada, we analyze how producers' individual characteristics impact their demand for different information services. Minimum distance estimation of the structural ordered probit equations indicates that:

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  Confidence in the information service is a central determinant of the frequency at which a producer refers to a specific service.

       
  
  

Stop and Go Agricultural Policies with a Land Market

This article studies the design of farm policy in the presence of asymmetric information about farmers' productivity, a government objective to insure farmers a minimum "parity" income, an endogenous land rent, and diminishing returns on alternative (nonprogram crop) land uses. In this setting, acreage set asides are never part of an optimal farm policy, although compensated acreage limits are. When there are new farmer entrants who cannot be excluded from farm programs, optimal policy takes the form of a pure voluntary acreage limitation—or "buyout"—program in which high-cost producers participate and low-cost producers do not.     

Impacts of capital and land constraints on the economics of new livestock technology in western Kenya

The introduction of new forages and milk marketing improvements was projected to permit even the smallest modeled farms in a western Kenya region to adopt dual-purpose goats and thereby improve family income and nutrition. Expanded credit permitted modeled medium and large farms, especially, to vigorously exploit these innovations; credit also expanded income more than did goat management improvements. Because credit, extension assistance, marketing improvements, and new forages will leave projected incomes of small farmers below those of medium and large farmers in the study region, development of off-farm jobs may still be necessary to supplement the incomes of this fast growing group. The marginal value of capital for medium and large farmers with new livestock technology was high. This suggests that government-subsidized credit might be unnecessary. With proper infrastructural and legal support, private capital markets might develop as new livestock technology and marketing improvements expand the demand for borrowing.     

Supply responses of peasant cultivators in the Sudan—a rational expectations model

Abstract

Most attempts to increase agricultural production rely on incentives to the farmer, especially regarding market prices, and a positive response by him. In this paper the latter is analysed with reference to two major oilseed export crops in the Sudan, groundnuts and sesame, under small peasant farming conditions. The methodology used to study the behaviour of farmers is based on Rational Expectations techniques and the data used are drawn from official time series material. The results obtained show that small farmers are responsive to price changes for these crops by adjusting crop areas. The implications of the results are of importance to policy makers in that peasant production can be stimulated by ensuring that the producers obtain sufficient price incentives to do so. An immediate priority is an in‐depth study of the competitiveness of the marketing system to provide adequate information on which to base remedial measures to ensure that the price mechanism transmits the appropriate signals to the farmers. A further important policy aspect is the need to change the reliance of the small peasant sector on shifting agriculture to maintain soil fertility, because of the increasing population pressure on land. In the longer term farmers should adjust to real price rises not by increasing the amount of land cultivated but by raising the productivity of their holdings in a new system of sedentary agriculture.     

Marketing Channel Choice and Marketing Efficiency Assessment in Agribusiness

In agribusiness, profitability critically depends on the choice of proper marketing channels. This article studies the factors influencing marketing channel choices of vegetable farmers. Vegetable farmers have generally 3 choices to sell their produce, which are formal and informal market participation vis-à-vis nonmarket participation. Ten independent variables are considered for the study and a multinomial logistic regression model is used for the analysis. The study finds 4 major variables that can influence farmers’ decision to shift from nonmarket participation to informal or formal market participation. The article further identifies 4 microlevel marketing channels and assesses their efficiency.