Agricultural Marketing

Growing food, mainly cereals such as sorghum, millet and maize in Africa, and rice in Asia, is generally the main source of income for the rural population. However, it must get to market cheaply and sell at a fair price if the family is to meet its taxes, pay school fees, buy the food they cannot grow themselves and in general, meet the many emergencies that the poor have to face.

An adequate transport network from farm to market is therefore vital to the rural farmer. Products must be brought from fields to the household or village. Once consolidated into a viable load, a family member can bring it to one of the numerous small local markets, usually situated close to  a motorable road and hopefully at walking or cycling distance from farms on good tracks and paths. Traders visit these markets or pick-up points and progressively build up a load sufficient to ensure a profit at a more distant market town. In some cases, if roads and weather permit, they will pick up at the farm itself. Alternatively, the farmer might choose to bypass the trader and either walk, cycle, or use whatever public transport there is to get to that market where he hopes  he will get the best price and at the same buy cheaply what he needs.

As shown above, a hierarchy of road types support crop and produce marketing systems. Rural road systems comprise the first three levels, from village to market town, and can often, if traffic levels are low and Intermediate means of transport common, link directly with larger towns, as simple earth roads shade into gravel ones. Generally, as roads approach centres of population traffic increases as does the average trip distance, dictating more robust roads. At the same time, roads become more elaborate and expensive and responsibility for them necessarily shifts from the local community, through local government and finally to regional and central government. Normally, rural roads should fall under community or local government control.

 Underpinning all this transport activity is the natural desire of all parties to buy cheap and sell dear as Adam Smith said (I think). Generally, prices increase as the number (and incomes) of buyers increases. Distance from producers and the adequacy of the transport system are of course important determinants of prices. Lowest at the farm, they rise progressively at each market level, to meet the needs of consumers with diminishing time and space to grow their own. The prices of manufactured goods follow an inverse trend, doubling the advantage to the farmer who can bypass the trader and get to the town cheaply and rapidly, sell his produce and buy what he needs at lower prices. This requires some form of public transport as his load, if the journey is to be worth while, will be too big to carry. Despite this, on market days roads are crowded with people who may have carried or wheeled heavy loads fifteen km or more, as transport is too expensive or scarce.

At the same time transport costs increase more and more rapidly as we travel backwards on the table above from town to village. Roads worsen, especially in the rainy season. Truck operating costs go up as do overheads as loads may be smaller and the risk of being held up for hours or days due to breakdown or closed roads increases. In some cases, marketing costs may become so high due to poor roads that imported food may become cheaper in urban areas, with disastrous consequences for rural towns and villages, not the least being flight to the cities.

The contribution of a good rural transport network to agricultural marketing is significant. A bad network worsens catastrophically during the rainy season. Poor roads and inappropriate and infrequent vehicles lead to little competition among traders, resulting in low prices for farmers, high prices for urban consumers (who are not that well off themselves) and paradoxically, windfall profits for a small number of richer traders. Adequate roads are essential for seasonal perishable products such as fruit and vegetables if they are not to rot in the fields. The farmer who must sell off most of his crop during the dry harvest season will have to buy some back at a far higher price towards the end of the next rainy season when stocks are low or cornered by speculators. Of course, he could in theory hold back as prices rise but by that time he might not be able to get it to market at all given the state of the roads. In any case needs for health care, school fees and so on usually too are pressing. Thus poor roads reinforce the dependence of farmers on the unlikely goodwill of traders.

It important to remember that markets are not just about buying and selling. Getting to market also means access to gossip, advice, useful information and of course  various products and services often only available in towns. Roads reduce isolation and the poverty associated with it.

Rural roads should never be better than just good enough. Networks become far too extensive to be maintained, when we include the simple tracks and paths feeding the low-volume motorable roads which make up the rural road network. However, the crucial role they play in the food marketing system requires that they be given much more attention than in the past.  This means not only more investment, but also more attention to the points raised on this site so that it will not be wasted.  In the past too many rural roads were improved at vast expense but without any noticeable impact on mobility.

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