From subsistence to markets

The challenges faced by smallholder farmers 

Agriculture is central to the lives and livelihoods of millions of poor people around the world. Close to 800 million people – or 78 per cent of the world’s poor people – live in rural areas and rely on farming, livestock, aquaculture and other agricultural work to eat and earn a living. Traditional smallholder agriculture is typically subsistence-oriented (ie food grown is largely eaten by those who grow it, rather than sold). As farmers are not selling their products, they lack income to buy other food, or to invest in agriculture or other potential livelihoods.

What is produced by a single farm for consumption is often not sufficiently diverse to fulfil nutritional needs. As the farmers are unable to buy food to supplement the diet, smallholder producers and their families often face food insecurity and hunger. 

The challenges of food insecurity faced by smallholder farmers are made worse by climate change. Agriculture as a sector is extremely vulnerable to climate change, and this is particularly the case for rain-fed agriculture. Increasing variability (and decreasing reliability) of rainfall, changing seasons, more frequent and severe droughts and floods, and temperature increases all contribute towards reduced, failed or ruined harvests and the death of livestock. 

In the context of low and declining agricultural productivity, many smallholder farmers often lack access to information on the types of seeds and crops, and appropriate farming methods, that are sustainable and will help them to adapt to climate change.

The challenges that smallholder farmers face are numerous. However, given the right support and opportunities, smallholder agriculture can become a profitable and rewarding livelihood. In many countries, population growth and urbanisation has given rise to an increasing demand for agricultural produce and the sector is receiving significant attention at regional and international levels. This resource outlines how smallholder farmers can be supported to take advantage of these developments.

The benefits of a sustainable, market-based approach  

‘Agriculture is not a way of life, it is not a social sector or a development activity, despite what people may claim. Agriculture is a business. And the more we treat it as a business, as a way to create wealth, the more it will promote development and improve people’s lives to boot.’ 

Akinwumi Adesina, President, African Development Bank 

A sustainable, market-based approach to agriculture can bring about transformation to the lives of smallholder farmers. Equipped with relevant market information, environmental awareness and sustainable agriculture techniques such as conservation agriculture, farmers can engage in agricultural production that is resilient to climate change and is profitable. And by working together as a group or association, farmers can negotiate fairer prices and better terms of trade for their produce.

With a good understanding of the whole value chain in which they are operating, farmers can add value to products through processing and preserving. In doing so, they can move up the value chain and significantly improve their income. 

This market-based approach to agriculture results in communities with strong, sustainable livelihoods and more stable, predictable incomes. When increased incomes are accompanied with values and principles to inform the way that the money is spent, the impacts are significant. Nutrition is improved as people have access to a wider variety of foods through their increased income. And through working with the community, using the resources they already have available locally, wider community transformation is often experienced. For example, young people become attracted to farming thereby reducing rural-urban migration; both women and men are economically empowered; dependency on external resources is reduced; and resilience to climate change is increased.