How Farmer-Allied Intermediaries Can Transform Africa’s Food Systems – a new report by Bain & Co.
Small Foundation are pleased to share an insightful and highly relevant report from Bain & Company. The report draws from the experiences of many of Small Foundation’s past and present partners including PFS, Root Capital, Acumen, TechnoServe and Babban Gona, and is a call to action for more collaboration in the sector.
Over the past two decades, donor countries, multilaterals and foundations have directed almost $40 billion to enhance African agriculture, yet food security in the region remains half that of developed markets. Net food imports have risen 400% since the early 2000s and are projected to reach $110 billion by 2025. Rapid population growth, particularly in cities, is creating ever greater demand for affordable, safe and nutritious food, while the increasing challenges of climate change affect supply. COVID-19 has presented another major crisis to an already-challenged food system.
In an effort to understand how Africa can unlock the potential of its food and agricultural sector to overcome these challenges, Bain & Company studied the companies and programmes already transforming parts of Africa’s food systems.
The resultant report, How Farmer-Allied Intermediaries Can Transform Africa’s Food Systems, contains many relevant insights which point to a central conclusion: in order to feed and employ the fastest-growing population in the world, we need a new approach to agricultural development in Africa – one that puts farmer-allied intermediaries at its centre.
Unfortunately, too few farmer-allied intermediaries exist in sub-Saharan Africa today, and many of those that do struggle to scale profitably. What’s missing is a well-functioning system: conditions within and surrounding the value chain that enable farmer-allied intermediaries to scale profitably. In many sub-Saharan countries, that system does not exist or function adequately. To build it requires a new approach to smallholder agricultural development and investing—one that prioritises high-potential farmer-allied intermediaries and brings together different kinds of support in a far more aligned, coordinated way. It requires capital from philanthropic, commercial and blended sources as well as supports beyond capital, including strategic and operational assistance that come from public, social and private sectors.
In order to put these ideas into action, Bain & Company has mobilized the Coalition for Farmer-Allied Intermediaries (CFAI), alongside TechnoServe, Partners in Food Solutions, the U.S. African Development Foundation, Root Capital and Land O’Lakes Venture37. CFAI seeks to build more resilient food systems in Africa by catalysing a movement around farmer-allied intermediaries. The ambition is to help scale many more profitable, competitive enterprises that enhance smallholder famer livelihoods, nutrition and food security, socio-economic development, and environmental sustainability through more effective collaborative action.