Globally, the Covid-19 pandemic has caused momentous disruptions to food trade and logistics systems and to the livelihoods of producers, causing commodity shortages and increases in food prices. In April 2020, as the pandemic was just gaining momentum, the World Food Programme (WFP) warned that because of income and remittance losses, an estimated 265 million people would possibly face acute food insecurity by the year’s end, a 96 percent jump from the estimate of 135 million people before the crisis. The WFP therefore called on policy-makers around the world to urgently put in place policies that would help to boost food production and avert food insecurities.
With overall demand for nutritious foods having most likely risen, underpinned by COVID-19-related health needs, and with food supply having been constrained by COVID-19-related border restrictions on regional and international production and imports trade, ultimately, agro-commodity and input prices have soared domestically. For example Zamstats Monthly Bulletins show that the price of basic foods, dried beans, dried Kapenta and eggs, respectively, increased by 22 percent, 14 percent and 17 percent over May 2019-May 2020 compared to 3 percent, 8 percent and 1 percent over May 2018-May 2019.
Whilst rising food inflation is generally bad, it has a silver lining; it provides opportunities for social solidarity for food producers who would be willing to band together and expand production, towards taking collective advantage of the favourable prices. In principle, therefore, the ongoing food supply disruption and food inflation increases during the COVID-19 pandemic are an opportunity for Zambian farmers, in particular small scale farmers, to increase supply and cash in on the relatively high prices.
In practice however, Zambian small-scale farmers, like in other developing economies, face considerable hardships to increase production because of their poverty-related pre-conditions. According to the Living Conditions Monitoring Survey, in 2015, 1.5 million households (50.1 percent of all households nationwide) earned a living out of small-scale farming and a staggering 79 percent of these were income poor, essentially rendering them incapable of rapidly scaling up production in times of food scarcity. Large public sector programmes like the FISP and SFR cannot be expected to make much of a difference. For example, the 2020 National Budget, which was estimated at a total of K106 billion allocated K1.1 billion (1.0 percent) to FISP and K600 million (0.6 percent) to SFR (compared to K10.6 billion or 10 percent on road infrastructure spending). Across one million beneficiary farmers – the usual target in National Budget speeches – the FISP annual allocation per farmer was K1, 112 (equivalent to K92.65 per month) and the potential earnings per farmer from SFR was K660 per year (or K55.00 per month), on average.
The big questions are then: how can the inceptive of rising food prices be realized for small-scale farmers, helping them to fully integrate in the food supply chain? And, how much of the price increases could small-scale farmers capture if well integrated into food supply chains? What mechanism could small-scale farmers use towards supply chain integration, given their preconditions such as limited access to finance, low economies of scale, restricted market access, poor infrastructure access, etc.?
As earlier alluded to, opportunities for social solidarity can be harnessed through cooperatives in order for small scale farmers to tap into the food supply chains and therefore take advantage of higher food prices under Covid-19. Cooperative movements are founded on shared values, beliefs and collective action among different groups in society. Interdependence of individuals in a society is at the heart of cooperative movements, which allows individuals to feel that they can enhance the lives of others along with their own lives particularly in the agricultural sector in Zambia. Harnessing social solidarity within cooperatives can help strengthen local food supply chains for small-scale farmers and allowing farmers to take advantage of COVID-19-related price increases. It would complement the 7NDP idea of leaving no one behind, particularly that the majority of small-scale farmers face binding production capacity constraints.
Though somewhat dated due to lack of updates, by 2013, according to the Ministry of Commerce, Trade and Industry Zambia had 33,818 cooperatives registered countrywide, of which 13,637 (40%) were agriculture and agro-related cooperatives. Although cooperatives have struggled notably since the post-1991 economic reforms, social solidarity still offers an intentional collective reinforcement mechanism for unifying the mutual interests of small-scale farmers to enhance their productive capacities. Given its high presence in Zambia’s agricultural sector, it can be harnessed by incentivizing cooperatives through the reform of large-scale public programmes like Farmer Input Support Programme (FISP) and Strategic Food Reserves (SFR), which could be targeted towards cooperatives rather than towards individual farmers.
At the core of successful cooperatives is the idea that small scale farmer production strategies can be enhanced for increased productivity and access to markets. Hence, policy-makers would therefore do well to strengthen cooperative movements and that this may potentially enhance the collective power of small scale farmers to glean more returns particularly in the face of rising prices. More integrated cooperative movements once operationalized can harness the silver lining opportunities that emerged with the COVID-19 pandemic. This would be an important step for creating jobs, enhancing productivity and incomes, expanding segments of food supply and value chains, and overall improving market organization, wealth creation and poverty reduction.
By: Claudia Pollen and Caesar Cheelo
The authors are researchers at the Zambia Institute for Policy Analysis and Research (ZIPAR). For details contact: The Executive Director, ZIPAR, MNDP Complex, Cnr John Mbita & Nationalist Roads, P.O. Box 50782, Lusaka. Telephone: +260 211 252559. Email: email@example.com