Journal of Agricultural Economics, Extension and Rural Development

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Engaging agro dealers in agricultural extension service and value chain development: An Approach to Modern farm advisory services.


Mathewos Belissa



Abstract

 

Accepted 20th March, 2018.

 

The paper is based on M.Sc. study conducted in Karnataka state attempting to investigate the potential of private sectors and their capabilities in offering extension services as part of their input marketing. It was assumed that increasing private agribusiness firms born during the time of green revolution of India have directly or indirectly involved in the farm business (including input supply and advisory services). The study aimed at identifying extension activities of private agro dealers who in one way or the other involved in input delivery, advisory services, post-harvest storage, agro processing and value added product marketing. Besides, their roles in collection, documentation, and transfer of knowledge related to production and marketing was emphasized in the study. While identifying the major activities performed, the approaches and methods used by private extension providers was identified. This is supposed to help improve the public extension services and/ or design privatization of extension services in countries like Ethiopia whose extension system has been threatened for decades for the reason of efficiency. This was due to the fact that private sectors, in most cases, were found most effective in the delivery of agricultural production technologies. The study indicated the better performance of private sectors in transfer of technologies. Even if it is not yet mature for substantial withdrawal of public supported extension, some methods can be adopted from experiences of private sectors to be used as an alternative mechanism to the public extension systems. From the investigation, three basic methods vis; methods of input delivery, systems of motivating clients and channels of input supply were found to best apply for the public supported services in farm production and marketing. Majority (70%) of private technological input dealers reported of operating input supply activities through sales transaction only. The remaining (30%) expressed that they go for different form of supply, besides sales of inputs; such as contractual farming, product procurement agreement, and share cropping. Three advantages were stated in using the above methods. One is, facilitating companies’ product selling, secondly, it enables easy acquisition of agricultural products from farm for exporting; thirdly, it helps agribusiness firms to create more farmer customers. Similar study confirms that private sector enterprises involved in extension activities as a contractual agreement with small and medium size farmers in the provision of inputs. They are playing an important role in the transfer of technologies and advancement of agricultural development through contractual arrangements with farmers. A number of methods have also been used in motivating farmers towards a given technology. Among these, the use of field assistants and marketing agents as advocates, demonstrations of inputs, distribution of publications/ leaflets and other supplementary materials. These methods have been used differently under different conditions. The third most important method of technological input delivery to be learned from private sectors’ experiences was the marketing channels for input supply (forward channel) and product acquisition (backward channel). Accordingly, four channels were identified. Channel-II was found to be the most effective and popular in the system. Sixty five per cent of the dealers reported of performing their task through channel-II. The channel involves the company-wholesalers-retailers-farmers. These findings are indications for emerging alternative paradigm that assumes market based solutions and privatization of extension services that has become effective. This alternative model also leads a farm business service that goes beyond extension provision to complement provision of credit and marketing assistance needed to make farmers profitable.  On top of that, private actors are with a capacity to support farmers on the value chain development and improvement of the competitiveness of selected value chain. Engaging private agro dealers in extension system for supporting the improvement of public extension services and/or thinking a reform model for privatization of the system is found to be development agenda of the day.

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Keywords: Private sector, privatization, agro dealers, contract farming, efficiency, public extension.