In Africa, Over 40% of agricultural produce do not get to the market either because of poor road network, non availability of storage facilities, poor post harvest handling and poor market feasibility.
At Farm La Vida Consults, we realized that agriculture has the potential to eradicate poverty, the government of different African countries now encourages her citizens to venture into agriculture. For example, the current feud between USA and China is forcing many agro processors in china to look into sourcing their raw materials from Africa which indicate a green light for many who want to venture into agriculture.
In Africa of today, agricultural goods exported to other continents is estimated to be over $250 billion per annum and this seems increasing as world population is increasing.
With this kind of statistics, many now choose farming as a career and also part time source of income to meet their basic needs but not all are successful in farming. Lots of people venture into farming with the aim of making big cash and escape poverty but they forgot that all business have its own ways of performing them for better result.
I have been asked by many people, including my client of this same question ‘How and where do I sell my farm produce’. A lot made the mistake of first cultivating their choice of crop before understanding how the market works.
Market however is the main reason for producing goods and services which means that before any good is produced, it is very important that the market is checked or reviewed to know how consumers will accept it and also their behavior toward the goods in terms of taste, colour, aroma and texture.
In Nigeria, there are open market and closed market. The open market is the oldest and mainly known as traditional market and dominated mostly by women except professions that involve strength which men venture into. The open market is where scale or kg or lb (weight) is scarcely used as there is known standard way of measuring the farm produce either by the use of big bowls as in the case of maize, cassava, palm oil, groundnut oil, size (plantain, watermelon, cucumber and others) and perishability (orange, banana, plantain e.t.c). This measurement is the most unreasonable way of cheating farmers and farm produce marketers because the measuring bowl or plate can be adjusted to suit their plan.
As prices of farm input continue to increase, it is very hard to make profit from open market because most of the buyers at the open market will never want to accept an increase in purchasing price unless there is scarcity of the same produce which is mostly fuelled by insecurity and non awareness of the produce. I personally have been a victim of this style while making research on cassava marketing, maize and plantain produce marketing.
The closed market is tends to give a higher profit margin because the farm produce get the main processor and/ or consumer while cutting out the middle men buyers at the open market. This type of market is scarce as it is not easily found unless a company makes an order for such farm produce and its readily available. The closed market is the best choice a farmer can connect with but many processors demanding for certain farm produce may be lower than other farm produce. For example, the demand for cassava by processors in Nigeria is on the increase because of the ethanol, starch and other by products derived from cassava.
An intending farmer or a practicing farmer must definitely find a way to connect with the closed market as they buy in scales weighed in kilograms and tones and this gives farmers the opportunity to increase their production.
Looking at where to sell, this has a paramount effect on your choice of farm location. It will be unwise to situate a farm in a state and planning to move the same produce to another far state because of demand. This will definitely increase the cost of production and may not favour the farm in terms of ROI. To better understand where to sell, there are some questions that must be answered and well described.
- Farm Closeness to Farmer Location: A farm that is very far from the owner location will definitely be hard to monitor unless there is installation of technology that can monitor daily activities. Many farms have been closed down because farm owners are looking for very cheap expanse of land without considering security and how to move inputs to the farm location.
- Soil: No doubt about it, a health soil will produce a healthy plant. While searching for a suitable farmland, the soil must also be considered and tested. This will help to reduce the quantity of fertilizers.
- Availability of Farm Labour: Unless you plan to venture into mechanized farming, human resources at the farm is no doubt the biggest resources to find. Do not forget that the integrity of your human resources will either make or mar your farming experience.
- Government involvement: One of the primary objective of a working government is provide basic amenities such as good roads, pipe borne water, education, health or medicare. In a location where all these basic amenities are not found, it is easier to lose a laid down investment in such location.
- Farm Inputs: Fertilizer is one of the farm input needed at the farm, a case where such farm input is scarce will cause a hike in price and farmers may be force to look for other location to purchase the farm input. Also, other equipments such as drip irrigation in Nigeria may increase the farm cost of production. This later increase the cost of transporting such farm input to the farm.
- Market: Either the closed market or Open Market, It is very important to know their location and understand them. The Market location must never be too far from the farm unless there is a better and cheaper form of transportation which will aid the farm produce to the market in due time.
Farm Produce market involves understanding how it works and modalities involves. To make better profit, market analysis and other factors must be carefully planned and decided. The success of any business start from idea to implementation. Farming has gone beyond just production but using to provide solution to problems in the society.
Do you have the plan to venture into crop farming? Or need expertise knowledge on how to start your farm. Don’t walk alone, contact us at Farm La Vida Consults, our doors are open for farm establishment, farm visitation, consultancy and value addition.
We will be glad to meet you and provide you a solution. Happy Farming Year!!!