Introducing Farmers for Farmers!
In the developing world, smallholder farmers are critical to sustainability.
Their crops offer an alternative to regions heavily dependent on imported food. That dependency can leave whole regions vulnerable as volatile food prices swing dramatically in the wake of global events like a pandemic, war, or regional market factors like inflation.
The challenges for these farmers are significant and most pressing is access to capital for quality inputs and a stable market for their products.
How It Works
Key Concepts
Quality Inputs
For farmers, their yield (or the measurement of the amount of agricultural production harvested per unit of land area) depends on the quality of seed and inputs they put in the ground. It can be the difference in how much product they are able to harvest and how much they are able to sell it for on the market.
Seed companies invest heavily in R&D to breed seeds that maximize the yield for farmers. Inherently, seeds that are harvested and re-planted lose a degree of their yield value each year limiting the production farmers get which is why most farmers in the US purchase hybrid seeds annually.
Quality Seeds are bought annually and bred to maximize the yield based on the types of soil, climate and to maximize the product-enhancing the nutritional value to compete and fetch a higher price on the market
Bin-Run Seeds are simply seeds re-used after each harvest. Their yield decreases each year and the product gets less valuable as it competes with more hybrid seeds.
Access to Capital
Farmers in Central Asia struggle with access to quality seeds but what they lack is access to the capital required to purchase seeds & inputs, farm them, harvest them, sell them and pay off the investment. The infrastructure is not in place to lend money at affordable interest rates. So – farmers are stuck using bin-run seeds which minimizes the output and quality of their product, diminishing the return on their yield even as food prices increase. Though a short-term solution, many farmers have been using bin-run seeds for close to 20 years!
The Solution: Sustainability
AgGrandize Global addresses these two needs through an initiative called: Farmers for Farmers. It is a “cashless farming” program that allows farmers to access by letting them ‘purchase’ quality inputs like hybrid seeds on credit from money raised in Farmers for Farmers. AgGrandize Global then provides mentorship by consulting with farmers to support their farming and maximize their yield. The farmers then ‘sell’ their product back at the cost they purchased the seeds and are paid the profit in cash which they can use to invest in equipment and support their families.
Compounding Impact
The best part is that the money paid back can be leveraged for the program the following year – so the gift compounds. $50 generally sponsors an acre for a farmer. If you give $100 in 2022, that $100 can be used by a farmer to purchase hybrid seeds for two acres. At the end of harvest, that farmer sells the crop harvested off of those two acres and pays the $100 back That $100 is then made available again in 2023 and if you decide to give again, the $100 you give in 2023 is worth $200 as that same farmer can now leverage $200 – or 4 acres – to purchase hybrid seeds, doubling the impact of the gift.
