Recommendations for restructuring food markets in the southern African region: Dynamics in context of fresh produce sub sector

Recommendations for restructuring food markets in the southern African region: Dynamics in context of the fresh produce sub sector

by André Louw, Leah Ndanga, Davison Chikazunga & Choolwe Haankuku

Paper for The International Food & Agribusiness Management Association 19TH Annual World Symposium, Budapest, Hungary June 20-21, 2009

Abstract 

Agri-food markets are restructuring, characterised by increased consolidation and concentration of the industry, as supermarkets continue to expand at an exponential rate throughout the southern-African region. The informal sector is also expanding characterised by a significant level of restructuring. Supermarkets have restructured their procurement strategies through the introduction of private standards, centralised procurement systems and distribution centres. Despite the increase in agri-food commodities emanating from the expansion of the retail sector, there have been little or no opportunities for smallholder farmers. The restructuring process is likely to exclude farmers from food markets in two ways; firstly through displacement of traditional markets by formal food chains; and secondly, the restructuring process will exclude farmers through the introduction of private standards. To redress the negative effects of the restructuring process certain issues need to be addressed. This calls for different stakeholders (public and private sectors and farmers) to harmonise their objectives and visions for the sake of smallholder farmers in order to realise the great potential there is in harnessing the benefits of the restructuring process.

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