Texting to improve Ghanaian agribusiness
A trial service being provided to farmers with mobile phones in Ghana is set to improve market access for small-scale food producers. FoodAfrica is a research and development programme enhancing food security in West and East Africa. The objective of the programme is to provide new knowledge and tools for researchers, decision makers and local farmers to improve local food security. FoodAfrica is coordinated by MTT Agrifood Research Finland.
Improving market access with technology
Economic growth and poverty reduction cannot solely be achieved through land productivity and food production but performance of the local market plays a decisive role in enhancing development. In order to support the poorest households it is necessary to improve infrastructure and performance of market institutions. Additionally it is important to create opportunities for small-holders to access markets where they can sell their products in reasonable volumes and standards, provide inputs and credits, and provide economies of scale as well as bargaining power.
This is possible through new market information systems and services based on communication technologies such as internet and mobile phones which create opportunities to reduce the cost of linking buyers and sellers within the value chain, and thus raising farm income and reducing poverty.
FoodAfrica’s ‘work package no. 6 focuses on improving market access for small-scale farming through the provision of market information by modern information and communication technology. In Ghana the FoodAfrica partner IFPRI, together with a local network operator Esoko, provides agricultural market information, such as customised crop price information, to sample households twice a week via SMS, or text messages. Soon a similar service will be tested also in Uganda.
Prices for products
FoodAfrica’s approach is unique, compared to previous projects which have used information and communication technologies (ICTs) for farmers, in that the information provided is customized to the participating farmers’ specific needs. Farmers benefit to the extent that it improves their knowledge about current prices in different markets and allows them to change their marketing behavior. Based on the information they receive via text messages, the farmers may find a market place, buyer or marketing time best suitable for them.
All in all, the farmers who are on top of things have a stronger position in the market and they might be able to negotiate better prices for their products. How much better off they are, is the question explored by the current testing phase.
The SMS’s include information about crops and varieties per region, seasonality, price details of seeds, fertilisers, pesticides and list of stockists within the 10 kilometer radius, current market prices, forecast of market trends, weather information, transport prices from points of production and a list of buyers.
Literate farmers with mobile phones
To be eligible for the service the farmers need to own a mobile phone and be literate. According to a baseline survey conducted by IFPRI, 59 per cent of Ghanaian households have a mobile phone, but few of them use it to obtain agricultural market information. Preliminary results of a similar survey done in Uganda shows that 70 per cent of Ugandan farmer households have at least one functioning mobile phone.
Customised information on commodities
FoodAfrica provides the service in co-operation with two local companies: Esoko and FIT-Uganda. Both companies provide training and information to the participating farmers. In Ghana the training is done face to face but in Uganda it will be done over the phone. Most of the information after the training is delivered to the farmers via SMS messages.
The companies collect price data on various commodities in various markets. The farmers who participate in the pilot study testing the service, get SMS messages with prices of several commodities in several nearby markets. The information is customised so that each farmer gets info on the commodities and markets he is most interested in. The SMS delivery is automated, making use of a database that includes price info, phone numbers, and the preferences of each subscriber.
The pilot study is scheduled to run for approximately two years - until mid-2015. After this, a survey will be conducted by the FoodAfrica team where the effect and usefulness of the service for households will then be verified.