Abstract: SEAAFSRE 11th regional conference; innovation system perspective in agriculture
and rural development for smallholder farmers. March 2012
ABSTRACT:Participatorymarketsystem
analysisforsavingandcreditgroupsin
theEasternCapeleadstosocial
innovationintheagriculturalvaluechain
Contact: Anton Krone, Erna Kruger
Tel: 082 8537812, 0828732289
anton@saveact.org.za, www.saveact.org.za
erna@mahlathiniorganics.co.za
ABSTRACT
A participatory market chain assessment was conducted in 2010 in the Alfred Nzo District
Municipality of the Eastern Cape (Matatiele, Mount Flecther), to augment the work of
SaveAct with the savings and credit groups (SCGs) in the area. SCGs show a natural
progression from saving for consumption to saving for productive activities as the groups
mature. Small agricultural enterprises however tend to flounder under the pressure of
high input costs, difficulty of obtaining inputs, production constraints unrealistically high
transport costs.
The participatory market chain learning and action methodology provided the process for
a joint, systematic analysis of and decision making around agricultural potential and
production and marketing processes and options with the SCG members.
Local market opportunities in the villages are extensive and demand is presently much
greater than supply. Six agricultural commodities were prioritized by SCG members, given
the importance of the activity in the villages, the size of the demand and the number of
people involved; poultry, potatoes, sheep, livestock, vegetable greens and maize. Initial
market maps were produced for each and used as a basis to deepen stakeholder
interactions in order to address some of the most pressing challenges and opportunities in
the market systems.
Commodity based interest and learning groups that incorporate individuals from different
SCGs as well as other community members and project groups were set up. The function
of these groups is to; explore production efficiency through focussed processes of learning
and mentoring in both technical aspects of production as well as strengthening the
financial and business management skills of group members and explore options for
cooperative activities such as bulk buying, management of group processes around loans
and savings, consideration of joint marketing and transport arrangements.
Commodity interest groups have progressed in a number of different ways, depending on
the particular interactions within the groups and has included joint input procurement
systems, increased use of and specific systems for saving for productive activities,
increased local marketing of specific commodities and exploration of value adding and
marketing options.
Stakeholder interactions and building of positive relationships with commercial and
institutional role players remain important. An initial focus on private sector stakeholders
and membership based organisations, including Potato SA, has provided the greatest
opportunity for interaction with smallholders and increasing the equity of their
involvement in larger commercial marketing processes.