INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE sustainable solutions for ending hunger and poverty Ghana Strategy Support Program Targeting smallholders for agricultural growth in Ghana Jordan Chamberlin 16 November 2007 Accra, Ghana

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 2 Pro-poor agricultural growth Ghana’s current development objectives place a great deal of emphasis on broad-based, pro-poor agricultural growth Emphasis on expansion of high-value & export-oriented cash crops improved production of food crops Transformation of smallholder agriculture

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 3 Who are Ghanaian smallholders? Data on small farms & staple agriculture Ghana Living Standards Survey 2005/ households regional & ecological zone inferences Production data SRID, Ministry of Agriculture: district data Field visits to maize producers (March 2007)

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 4 Smallholders dominate agriculture Two thirds of all farms less than 3 ha Coast, 2.3 ha avg Forest, 3.1 ha avg Savanna, 4.0 ha avg

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 5 Smallholder crop portfolios Number of crops varies with farm size < 2 ha: average of 3.1 crops >=5 ha: average of 5.0 crops Maize & cassava most important in smaller farms The only crops produced by 12% of households (median holding size 0.8 ha)

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 6 median # crops

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 7 Smallholders do engage markets Less variation by holding size Commercialization rates lowest for smallest farms fewer marketed crops less likely to sell the crops they do produce More variation by geography % of maize farmers who sell their produce

Yields are growing but still low Fertilizer & other input use is driven by geography Anecdotal evidence that fertilizers are freq. used to compensate for land degradation rather than to maximize yields % of farmers using purchased fertilizer

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 10 Farm size ≠ poverty Relationship between income and holdings is weak and variable across geographical space Positive in forest/transition Negative in coast Agrees with anecdotal evidence that land is not the chief limitation, but rather access to labor and other resources… Per capita consumption & hh landholding

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 11 Characterizing smallholders Holdings are small, but size does not fully explain farmer behavior Incomes and income sources vary widely Yields are low; input use is low Market participation is variable but staple markets are widely engaged in (esp maize)

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 12 Characterizing smallholders Geography is more important than holding size for capturing many smallholder characteristics, including input use and many aspects of market participation What are the key constraints faced by smallholders and how do the conditions under which they produce modify those constraints?

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 13 Constraints faced by smallholders Production technologies are not accessible factor market constraints: labor, mechanized traction Risk of production failure (rainfall variability) Uncertainty about market opportunities & prices Poor returns on productivity-related costs

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 14 Source: Personal communication from Natural Resources Institute, 2006, as published in World Bank 2007: 119 For example, consider these costs along the maize chain from farm gate to Accra retail – equivalent to 80% of producer price for a producer near Techiman High transactions costs & poor access

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 15 High transactions costs & poor access Much of the production base and many of the rural poor are located in areas with poor access

The access story has many overlapping dimensions

Rainfall Rainfall variability

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 19 Targeting smallholders The challenges faced by different types of farms are heightened by production and market environments Much production takes place under conditions of high costs, poor information, risk many smallholders do not perceive benefits of productivity investments

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 20 Targeting smallholders Strengthening food markets (maize) is one of the most important means of engaging the largest portion of smallholders, and thereby increasing productivity and income Development of more profitable technologies More efficient and competitive input markets More efficient output marketing chains Market information, weights and measures Risk mitigation Continue to explore alternatives e.g. organic production; high-value non-perishables

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 22 Smallholders less likely to use some inputs * relative to average share for producers with smallest holdings % holders using purchased inputs

Ghana Strategy Support Program INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 23 Holding size may not well explain food crop marketing Share of production sold

Yields are still much lower than potential especially in low access areas of the north District-level maize yield gap