Climate change has exacerbated the frequency and severity of extreme weather events affecting the livelihoods of millions of smallholder farmers across Sub-Saharan Africa. Risks such as increased droughts, pests, floods and heatwaves, are projected to increase significantly in future years. The formal seed sector is an important entry point to help farmers better manage these risks, as it provides access to high-quality seeds of improved stress-tolerant varieties, selected and bred to increase productivity in good years, whilst reducing the impact of these risks in bad years. The challenge, however, is that the formal seed sector is not always inclusive, and is more accessible to relatively larger (and often male) farmers, whereas smaller (women) farmers are more likely to obtain seeds from informal sources, such as their friends or peers. This is creating social inequities in the distribution of seeds; and in qualitative research, farmers informed us that the pandemic has further restricted their access to inputs.
ACRE Africa provides agricultural insurance products as part of a holistic integrated risk management approach, to de-risk the farmer at all stages of production. To deliver our products, we are working through champion farmers: key opinion shapers with substantial influence on agricultural practices in the villages they reside, who can promote gender inclusivity and diversity. Champions are trained on various aspects of the projects (at the beginning of every season), branded, equipped with smartphones and engaged to carry tasks for which they are incentivized. The primary objective for this champion farmer model is to institute an agent network that can sell and distribute our agricultural insurance products, but champions also train farmers on integrated risk management; create awareness/sensitization on different types of risk management products; facilitate output market linkages; and, as part of our efforts to increase farmers’ access to quality seeds, and to diversify champion farmer revenue streams, we are linking champions with the formal input sector to distribute and sell agricultural inputs. Using their social networks, champions can form a bridge between informal and formal systems, providing both women and men with better access to quality seeds.
The model works as follows. At the start of the season, champions take an inventory of the demand for different types of seeds within their community. Then we place orders with seed companies through local regional distributors and engage regional supervisors to distribute these seeds to the champion farmers, based on the original inventory of demand in their community. Champions receive these seeds at convenient points where they can easily meet the farmers, for instance at market centres, where the farmers can finalize their purchase of the seed. As motivation, champions earn a commission per bag of seed sold. This commission is marked as the difference between the wholesale price negotiated with regional distributors and the retail price at which the champion farmers sell the seeds.
This champion farmer model introduces an innovative dimension to inclusive seed distribution, but we had to test and refine this approach. In previous seasons, we had worked together with two seed companies, Drylands and UPL, to distribute small demo packs of stress-tolerant varieties of maize (Sawa) and sorghum (Advanta) to 190 champion farmers and close to 3,000 farmers that they had registered in seven counties spread across Kenya (Busia and Bungoma in the western region; Embu, Meru and Tharaka Nithi in the upper eastern region; and Machakos and Makueni in the lower eastern region). We did this to make sure that farmers would have experience with (and would want to purchase) the varieties that we were planning to distribute in future seasons. At the start of the short rains season of 2020/202, champions in Meru and Tharaka Nithi started booking demand for seeds using KOBO Collect (an open data kit (ODK) digital platform).
It was good that we started relatively small, instead of rolling this out in all seven counties. Despite high demand in the original demand inventory (champions collectively booked 2,091 bags of maize and beans) only 4 champion farmers were able to sell seeds; combined, they sold 54 bags of sorghum and 15 bags of maize seeds to their farmers. The large gap between the original demand inventory and the actual sales amounts was largely attributed to:
- Lack of trust from farmers, who demanded to see the seeds first before buying (seeing is believing), and did not want to pay for seeds upfront – to overcome this challenge, we had to acquire financing for the champion farmers, which delayed the actual delivery of seeds;
- Competition from Government interventions such as the Kenya Cereal Enhancement Programme (KCEP), giving smallholder farmers access to improved agricultural inputs and technical packages, to enhance productivity because of commercialization;
- Late start of the season, seed demand booking activities, and delays in the delivery of seeds, resulting in most farmers having bought the seeds from other vendors by the time that the seeds arrived; and
- Low margins i.e., a small difference between negotiated wholesale prices versus retail prices at which farmers would normally buy seeds, translating into low commissions for the champion farmers (per bag sold the champion farmer would receive KES.20 or KES.10).
We decided to mitigate and address these challenges in the next season, the Long Rains of 2021. We ensured that the season activities were implemented early enough to guarantee enough farmers purchased from our champions, and we ensured that the seeds were delivered to the champions as soon as demand was booked, to promote trust among their farmers, and make sure that seeds arrived before a farmer would want to buy seeds elsewhere to be ready for the upcoming rains. We encountered little to no competition from government programs, because in most target counties, this season is not considered most reliable, and we thereby filled an important gap in access to quality seeds. Importantly, we instituted a revolving fund from the onset of the season, through which seed purchases from regional distributors were financed, and as seeds were sold to farmers, funds were restored in this revolving fund.
This seed marketing and distribution activity and associated sales outcomes were positive. Most champions engaged their farmers and booked seeds, but there was still a mismatch between the amount booked on our KOBO Collect platform and the amount that was sold to farmers (see figure below). In addition, the demand for stress-tolerant varieties (STVs) that had been promoted through the project (Sawa maize and Advanta sorghum) remained low; despite prior experience with these varieties from trial packs and demo plots, farmers stuck to their guns and ordered regular varieties, such as Duma-43, Western seeds, Kenya Seeds, DK 3081, Gadam and KS20.
The demand for seeds – booked versus actual sales of different varieties
What have we learnt along the way?
- Margins between negotiated wholesale prices from regional distributors and retail prices are insufficient to cover distribution logistics. In the future, we plan on working with seed companies to distribute seeds to champions directly, thereby bypassing regional distributors, and increasing margins.
- A financing mechanism needs to be in place for this model to work. Our revolving fund worked well, but restricted the scale of the operation, given that the funds available for such a facility are limited within our organization. We are looking to establish strategic partnerships with financial institutions to leverage their existing infrastructure (e.g., go-downs, credit facilities) and promote sustainability.
- Having received trial packs of new stress-tolerant varieties in the past was insufficient to generate demand at scale. A question is whether the varieties did not perform better than farmers’ common varieties, or whether farmers need to see more evidence. Champions have been (and will continue) monitoring the performance of different varieties throughout the season using smartphone images submitted via the seeitgrow App to shed light on this issue.
With many lessons learnt along the way, there is hope that this model can be scaled. We have started adopting a similar model within other ongoing programs, and will test whether our approach of improving access to seeds enhances the outreach and impacts of our insurance products, as well as the sustainability of our business model, relying on champion farmers as entrepreneurs of rural innovation to reach the last mile.
ABOUT THE AUTHORS
Berber Kramer is a Senior Research Fellow and Carol Waweru a Research Associate with the Markets, Trade, and Institutions Division of the International Food Policy Research Institute (IFPRI), based in Nairobi, Kenya.
Lilian Waithaka is an Agri-Climate Risk Data Analyst, Joseph Chegeh an Agronomist, and Jean Eyase a Communication Specialist with the ACRE Africa, a private company, in Nairobi, Kenya.
Benjamin Kivuva is an Assistant Director, Crop Production and Seed System, with the Kenya Agricultural and Livestock Research Organization (KALRO) in Nairobi, Kenya.
Francesco Cecchi is a Postdoctoral Researcher with the Department of Development Economics of Wageningen University in Wageningen, the Netherlands.
ACKNOWLEDGMENTS
We are grateful to Samson Dejene Aredo and Daniël van Hemert for excellent research support, to all colleagues at KALRO and ACRE for their invaluable contributions to project activities, and to UPL Ltd.
and Dryland Seeds for their dedication to testing alternative business models for seed delivery. This work is undertaken as part of the CGIAR Research Program on Policies, Institutions, and Markets (PIM) led
by the International Food Policy Research Institute (IFPRI).
