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Re: Enabling rural cooperatives and producer organizations to thrive as sustainable business enterprises

Peter Steele Independent Consultant Agricultural Engineer, Italy
Peter Steele

Seeking Novelty and Success - Potato Producers in Uganda
The moderators were seeking information to describe cooperatives and other producer groups that may warrant further scrutiny for the value of their models, modus operandi and performance.
Towards the end of last year we prepared an appraisal: 'Irish Potato Production in East Africa'. This was sub-titled 'Appraisal of the prospects and requirements for improved food industry value addition and technical efficiency of the regional Irish potato industry'. Sure, that's a mouthful, but this was the description contained in the ToR for the work required.
We explored production in six East African countries and came up with an action plan for boosting regional production - co-ordinated, more efficient use of resources, market-orientated, profitable, etc. You can ballpark the criteria involved but, for the current debate focused upon 'cooperatives', our findings may have some value. The action plan contained six sub-programmes of which sub-programme 1 entitled :'Strengthening potato value chain' contained the following key outcome points:
•    Growers linked to markets.
•    Innovation captured and linked to growers.
•    Information shared.

In support of these key points we listed a number of activities that should be followed/adopted - separated in two parts:

1. Improve value chain performance
•    Indentify the main players in the value chain.
•    Encourage the main players to form groups.
•    Put groups in contact one with the other.
•    Establish permanent linkages between groups.
•    Promote the intentity/reality of the value chain.

2. Develop market prices information systems
And listed five key activities that should be followed.
Out study highlighted the relative productivity of smallholder production (particularly in Rwanda & Kenya), but the paucity of marketing skills, information and dexterity when selling surpluses. There were deficiencies thoughout the production/processing chain, much of which could be re-evaluated/improved with the promotion of producer groups. That is - these groups and those who finance them take on the role of industrial entrepreneurs; organizing production, and meeting the requirements of processors/consumers.
National industries are suffficiently small-scale to enable potato-growing communities to provide the resources with which to boost productivity throughout the chain. To provide one example, explore the performance of the Nyabyumba United Farmers (NUF) of Kabale, Western Uganda with their links into a commercial fast-food outlet in Kampala: supplying >7 tonnes high quality bagged ware potatoes on a bi-weekly basis over a period of >5 years, and boosting returns on investment  by members of the order 70%.
These are 120 ex-farmer field school small-scale growers who formed a producer organization, chased contracted demand 300 km from home and delivered the quality and quantity required on the basis of little more than enthusiasm and a light truck; and met delivery schedules. You can source  their story at: It's entitled: 'Linking smallholders to remunerative markets: how smallholder potato producers in a remote district of Uganda market their potatoes to NANDOS in Kampala'.
Potatoes are the ideal East African food crop - high nutritional value, high productivity, etc. and importantly, they can be grown throughout the region, and match the changing demands of urban lifestyles for foods that are novel, quick and easy to prepare, and which project a sense of modern change. Walk the streets in most East African towns/cities - after school, during the evening 'rushhour' or at the week-end and count the number of kiosks, shops and outlets selling crisps, fried potatoes and other potato snacks. Sometimes it seems that everyone you can see is walking and eating potato foods.
Cooperatives may be a means to an end - and not an end in itself - but you have to produce to meet market requirements, and those markets are largely nuetral to the kind of production/delivery systems that may evolve. The issues then become those of choice.
We can explore the potato industry/markets reporting further in the context of producer groups if this is of interest
Peter Steele