WHY AGRICULTURAL VALUE CHAIN FINANCE IS VERY IMPORTANT (2) Cotton as example

Value chains differ across continents, countries, towns and villages. Value chains exist at each level of production – production, harvesting, processing, packaging and marketing.

In developing countries, smallholder farmers can harness their resources by forming cooperative groups where they make regular contributions. The contributions can be utilized in bulk purchase of inputs for the group members.

 

  1. When farmers (Primary producers) have access to finance, farm production can be increased. Finance is available for land preparation, to procure inputs such as improved seeds, fertilizer, chemicals, pay farm labour for operations from planting to harvesting and marketing.
  2. Sustainable supply of raw materials to the Cotton processing/textile factory is guaranteed.
  3. The Cotton/Textile industry will not experience down time in its processing operations. Raw cotton will be processed into Cotton lint for the production of the finished textile material. There is an assurance of continuity in factory operations.
  4. At each stage of production, there is value addition in both quality and quantity of both raw materials and finished products.
  5. Consumers are assured a flow of finished goods.

Consequently farmers are able to improve their livelihoods. There is reduction in production risks and the farmers can face the future confidently.

 

Author Bio

belvyna

Mrs. Yemisi Akibu ( nee Awokoya) is the Chief Executive Officer of Belvyna Global, an agricultural consultancy service firm based in Lagos, Nigeria She is a former Team Member of the Agricultural Department of Union Bank of Nigeria Plc, one of Nigeria's first generation banks. She holds a B.Sc degree in Agricultural Economics from the University of Ibadan, Nigeria and a Masters degree in National Development and Project Planning from the University of Bradford, West Yorkshire, United Kingdom. She is passionate about the role agriculture plays in the social, economic, political development of a nation. She holds the view that one of the pillars of stability of a nation food security and this can only be achieved through the holistic development of the agricultural sector. She can be contacted via: yemisiakibu@gmail.com or info@belvynaglobal.com Remember, The Farmer Is King Enjoy my blog

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