Small-scale farmers must first identify the market for goods they intend produce to avoid surplus and competition that lead to low prices.
Speaking Wednesday night during an agribusiness innovation forum dubbed What Next AgTech at Strathmore University, a Western Kenya renowned large-scale sugarcane and maize farmer Charles Odida said producing for an imaginary consumer chocks the market, which cannot seep the surplus.
Farmers sell produce at low prices when there is surplus harvest to even recover costs incurred, moreso for perishables. Even for non-perishables like grains, they still sell at dismal prices for fear of post harvest losses resulting from poor storage.
“Before one starts producing maize, they must know who their target market is. It will be helpful to know if indeed a given institutions will need one's product after harvesting. This will also guide how much one needs to produce to meet the demand of the clients,” he said.
For instance maize, which he has produced in small-scale and large scale, he first contacted institutions and asked them how much they would need in a year.
Based on this information, he had had a target to meet, therefore, adhering to the correct ration of inputs was the only option to deliver a yield that would satisfy all his clients.
“When I was still at primary school, I identified that teachers needed vegetables. I had to work out on how to constantly supply them with vegetables. I curved out my market, which never faced competition or loss due to lack of market,” Odida said.
The farmer added that he has succeed in agribusiness on his more than 100 acres because of focusing on quantity of the yield per acre, not the size of his maize and sugar fields.
He said technology should only complement existing knowledge such as proper timing, best crop husbandry in the field and proper post harvest practices to maximise profits.
Odida played down claims that many agribusiness innovations are shelved for lack of implementation funds.
“Agriculture is the only enterprise that allows for farmers to start with the least capital. Even with a big piece of land, you can start small on a portion, which can swallow inputs that you afford. After the first harvest, you can increase the acreage following good return from the past season,” he said.
Umati Capital's Munyutu Waigi cautioned farmers against cooperatives, which he said do not add value other than eating into their earnings.
At the same time, he said, bank loans do not add value to production and the access to funds is too slow.
Kenya Biologics Chief Executive Officer said high yields can be realised by more specialisation on a given product.
The event, which was sponsored by Nest Nairobi, was attended by 'new' agriculture stakeholders, who are keen at innovation as the driver to the next big thing in the globe.