Successful intermediaries can save agriculture
Bangladesh's achievement in the agricultural sector is unthinkable. Productivity in the sector has increased rapidly in the last few years. Our farmers produce new species of crops now. We get summer-tomatoes produced in Bangladesh, like many other new crops, such as capsicums, broccoli, dragon fruit and strawberries, all now available in the cities. Development in fisheries and livestock is also visible.
Bangladesh is moving fast compared to neighboring countries in agricultural production. There is certainly huge potential in Bangladesh in the agricultural sector. However, despite the hard work and risk in investment, the farmers are not even able to earn back their cost of production. If farmers get a good price for a product this year, most farmers in the next year pay more attention to the same product. Therefore, as its supply increases, its value in the market decreases. Farmers of rural Bengal lose their capital, thus losing their interest in agriculture. The new generation farmer families are not getting fair prices and are constantly at risk, looking for other jobs outside of agricultural work.
At the same time, consumers are devastated with the increase in prices. Whether in the capital or in the small cities, middle-class, lower middle-class or the marginal population, everyone is expressing frustration over the rise in the prices of agricultural commodities. Consumers are frustrated while buying these locally produced agricultural goods. It's a strange situation. Where the producers are frustrated because they are not getting proper prices and the buyers are depressed because they have to deal with such high prices.
In general, the blame is placed in the middlemen or the government's import policy. With a little analysis it can be seen that these middlemen are many in number, isolated and unorganised. Talented entrepreneurs are not involved in this work, because this occupation is overlooked in our society.
Like in any other country, in Bangladesh the business community has a role to play in determining government policies. Leading traders in Bangladesh are interested in export-oriented industries or import-oriented trade. Educated, wealthy businessmen are not focusing on agriculture. In recent times, those who are investing in agriculture are paying attention to agricultural input supplies, processing or market outlets. This is obviously encouraged, but they join at the beginning of the whole supply chain or at the absolute last steps. After a long way the product reaches a buyer's hands. All micro level intermediaries involved in this path are constantly at risk. Suppose a farmer sells a cauliflower at seven or eight taka at his farm or in a nearby market, in the city markets the same cauliflower is sold at taka 40-50. Established entrepreneurs are investing in the input market or in the marketing of this cauliflower at super shops. The same phenomenon is happening with rice and other agricultural products. Thus, big players are involved in a very small range; whole value chain is being neglected. As a result, businessmen are indifferent to bargaining with the government on agricultural business.
The government gives subsidies to on-farm activities but again it is a small part of the whole value chain. The farmers are unable to utilise the advantages as the rest of the supply chain has failed to attract the big players. This miserable cycle of agriculture is pushing this ancient profession into a continuous threat.
People blame the intermediary or government policy and that’s it. This situation is not pleasant for anyone. And a gap is created, where no one is coming up with a solution. No initiative is seen, the entrepreneurs are not flooding in with ideas here.
There are many barriers seen in this chain. Wherever there are obstacles, there is the possibility of entrepreneurs’ involvement. A successful entrepreneur will look for new avenues to explore. There is a tendency to copy-paste in the industry and trade sectors of Bangladesh. When the probability of the business is proven to be true, everyone jumps in. But there is no such initiative now, even though there is such a gap between producers and consumers within the agriculture food value chain.
Entrepreneurs will have to think that they will not be limiting themselves within this small scale (start or end phase) of the whole value chain. An entrepreneur will show a new way, attract investment and apply modern technology while using information efficiently. After harvesting, taking to wholesale market requires intelligent decision, informed sorting and smart packaging. It also needs proper cold chain, modern transport system to avoid rotting and efficient distributing channel. Entrepreneurs must analyse the demand of individual kitchen markets before commodities are showcased. They should also analyse only the requirements of a particular population, enabling farmers to produce goods most suitable to that population’s demand. And this initiative can be chosen by any entrepreneur who is smart and has the mindset to contribute in growth maximisation.
As far as agriculture is concerned, every step is very important. It is believed that as a country develops, it moves out from the primary (agricultural) sector towards the service sector. Here, instead of discouraging people to step out of agriculture and hence, holding down development itself, we are encouraging people to invest in this sector in a wiser and efficient manner by targeting the service market. From post-harvest till households, each level requires attention and strength. And there's a great opportunity for adding value at each of these steps. Take the opportunity to become a successful entrepreneur through smart solutions, without ignoring this intermediary role. From 7-8 taka, till 40-50 taka, there’s a middle-ground. Whether you will contribute only to the beginning and the end, or the entire middle-ground, is the choice to focus upon.
* Nazbul H Khan is Country Representative of Winrock International, Bangladesh and can be reached at [email protected]