49. Walmart's Direct Farm Program

Mar. 8, 2016 - International Women's Day
(Parts excerpted from nextbillion.net/)
On this special day, we wanted to highlight a source of promise and hope for the future in the world of global trade. Specifically, the food and consumer goods retail trade, one of the toughest most global, competitive industries. At the top of that competitive heap of global traders is, of course, Walmart. We'd love to hate them, but guess what? They are showing some pretty impressive leadership capability.


As the world's largest grocer, Walmart's "Direct Farm" program has been increasing farming productivity and farmer's income since 2007. By directly connecting farmers with markets, taking food waste out of the supply chain, motivating farmers to produce more with fewer inputs, and sourcing key agricultural products responsibly, the program is now reaching its 10 year mark.


Under the Direct Farm program, smallholder farmers in developing countries are asked by Walmart to grow a certain type of crop under conditions deemed acceptable to Wal-Mart. In return, these farmers are provided with modern training and methods as well as initial startup materials such as seeds. More importantly, Walmart purchases the entire production at a set price directly from the farmers, thereby setting – but also guaranteeing – price and demand to the farmers. This way, the farmers can sell more (due to higher yield resulting from optimized inputs) at a higher price due to the direct selling contract with Wal-Mart. At the same time, Walmart can secure its supply of affordable, high-quality, and fresh food worldwide.

After launching the Direct Farm program in China, over 800,000 farmers, including women, participated in Walmart's "direct farm" program and increased their earnings more than 10 times by the end of 2010. The success in China sparked the roll-out of the program to Brazil and India, and perhaps even further. 

While the Direct Farm program has not been specifically geared toward women, in September 2011 Walmart began its Global Women’s Economic Empowerment Initiative to help empower women across its supply chain. The goals are to increase sourcing from women-owned businesses, empower women on farms and in factories through training, increase market access and career opportunities, provide job training and education, and increase gender diversity among major suppliers. As part of this initiative, Walmart funded new projects in 2012 targeting women in the agriculture supply chain, such as helping women farmers make their agricultural operations more sustainable and productive through its Direct Farm program.

It's hard to say whether Walmart's version of "Direct Trade" pre-dates or follows the trend toward direct trading in coffee. In any case, it is interesting that they have seen the benefits of direct trade. It seems like soon the big, global players in coffee will be "catching on." Starbucks new "Reserve Coffees" being one example. Importantly, (on International Women's Day) one must also note that after only 5 years of the Direct Farm program, Walmart added a focus on women in the agriculture supply chain. This author knows from presentations made by Beth Keck, Walmart's Director of Diversity at the time, that these programs were successful in reaching 1,000,000 smallholder female farmers.

 

Under the direct farm program, local farmers would be asked by Walmart to grow a certain type of crop under conditions deemed acceptable to Wal-Mart. In return, these farmers would be provided with modern training and methods as well as initial startup materials such as seeds. More importantly, Walmart would purchase the entire production at a set price directly from the farmers, thereby setting – but also guaranteeing – price and demand to the farmers. This way, the farmers can sell more (due to higher yield) at a higher price due to direct selling (see video). At the same time, Walmart can secure its supply of affordable, high-quality, and fresh food worldwide.
After launching the direct farm program in China, over 800,000 farmers participated in Walmart's "direct Farm" program and increased their earnings more than 10 times by the end of 2010.
- See more at: http://blogs.anderson.ucla.edu/global-supply-chain/2013/09/a-win-win-supply-chain-walmarts-direct-farm-program.html#sthash.I6l1G80t.dpuf

As the world's largest grocer, Walmart's "direct farm" program is intended to increase farming productivity and farmer's income by directly connecting farmers with markets, taking food waste out of the supply chain, motivating farmers to produce more with fewer inputs, and sourcing key agricultural products responsibly. - See more at: http://blogs.anderson.ucla.edu/global-supply-chain/2013/09/a-win-win-supply-chain-walmarts-direct-farm-program.html#sthash.I6l1G80t.dpuf

As the world's largest grocer, Walmart's "direct farm" program is intended to increase farming productivity and farmer's income by directly connecting farmers with markets, taking food waste out of the supply chain, motivating farmers to produce more with fewer inputs, and sourcing key agricultural products responsibly. - See more at: http://blogs.anderson.ucla.edu/global-supply-chain/2013/09/a-win-win-supply-chain-walmarts-direct-farm-program.html#sthash.I6l1G80t.dpuf

49. Field Visit 4.5: Gatwa Farmer Interview

Tues., Feb. 23, 2016
Today I had the opportunity to truly appreciate the strength and endurance of the enumerators taking the baseline survey for the AGLC project. The terrain is mountainous and the farmers are usually located far from the road. The enumerators, there are 5 in the group I met, eat breakfast together at 6:30am in Musanze town each morning, depart in their vehicle (with a driver) at 7:00am, in order to reach the washing station in the Gakenke area by 9:00am. Today, I drove in from Kigali, and met them at the washing station.

By 10:00am we were meeting the farmers we would interview. By about 10:45am we were at the first farmer's home, beginning the interview. We finished the interview about 1:00pm. By 1:45pm we had hiked back up to the road and into the town where I had parked my car. Frank, the enumerator I "shadowed" for the morning, met the second farmer there and started the hike towards his house. I had to depart in my vehicle for Kigali.

See the illustrative sequence of photos below.
PART 1 - Start and homestead

From the list of randomly selected names, Frank has drawn 2 numbers for the farmers he will interview today. (Photo intentionally blurred.)

These are the two farmers (left and right) and Frank, the enumerator (center), heading towards the first farmer's home.

After reaching the house, Frank gets out the Samsung tablet and fires up the first interview of the day.

Taking the GPS coordinates at the house.

Asking the farmer the "household characteristic" questions while sitting in the yard in front of the home.

The farmer's wife brings out the land title documents for this farmer's land.

Frank notes the size of each of the farmer's 9 plots of land from the documents, before entering the data in the tablet.

Data processing -- from title documents to tablet.

Snapshot before we leave the home to visit the coffee fields.

Part 2: Visits to coffee fields and then 80% of the questionnaire - before the rain started.

Trail from the home to the first coffee field.

Frank paces off the width and depth of coffee field #1.

Frank takes the GPS coordinates at coffee field #1. He did this at coffee fields #2 and #3, also. If a farmer has more than 3 fields, the enumerator measures only 3 of the fields.

A small set of questions is conducted at the first coffee field.

Settled in for the long set of questions in the 3rd field. This farmer said he knows the antestia bug and has seen them in his field!

Unfortunately, the farmer did not seem to know much about what leaf rust is. I asked "what is this?" and he said it's a problem with an insect. I'm hoping he does know it, and it was just a translation problem. I saw a lot of rust on his trees.

Starting the choice experiment.

"If you had 40kg of cherry, and these three choices for selling it, what would you do?"

Each choice offers a different array of price and distance to point-of-sale. The farmer is asked to assume a cherry-to-parchment conversion of 5:1. The third choice is "same as I did last year."

Part 3: Under the eaves of a neighbors' house as it rains

The interview continued under the eaves here.

This neighbor had 2 cows and a calf (a black one behind the gate), and I got to see where they make banana beer.

The interview completed on this side of the house, where there was a bit more shelter.

The kind mom who welcomed us into her home and her day of chores.

A very fitting ending, I thought, was a chance to read the signs that decorated the walls of the home.

This was one of 4 or 5 charming signs in the room. In English, "The household where there is love and harmony, there is  God."