Question 2 (8 Dec.)

The impact of ICTs on the agri value chain are multifarious. Let us analyse it in two ways ; Impact on backward linkages: The ICTS can assist in providing relevant information about procurement of agri-inputs, prices of agri-inputs and also the launch of new products and brands. They can be aware of new technologies / good agricultural practices. ICTs can also make the farmers aware about the various various Government schemes on agriculture finance/ health etc. Impact on forward linkages: ICTs can really help the farmers to link to the markets.First, they can be aware of the new markets , domestic as well as exports and can reach the alternative channels Next, ICts can help in price discovery and this is the most important area as far as farmers of developing countries are concerened as due to lack of awareness of prices prevalent at various mandis ( agricultural markets) they are unable to sell their produce at premium prices All this can really help to make the chains efficient and systems more transparent and empower the farmers in these countries. Please feel free to ask or share anything Thanks Sapna

Hi, ICT can reduce transaction through telebanking. (If the illitecary complex among rural residents is taken care of, through empowering with ICT itself using the mobile phone, the telecenters etc.) ICT reduces transaction costs if regular information on commodity pricing is availed to the rural people and loan systems are structured through ICT, so that it becomes important for the rural people to demand for ICT education. It also reduce transation costs by eliminating the middle-man factor. Mohamed

[quote="Lisa-Cespedes"] Question 2 (8 Dec.) What positive impact can ICT have on the agricultural value chain? Where in the value chain can ICT reduce transaction costs? [/quote] ICT is likely to be one of the biggest revolution that will change the literal and business environment of agriculture. The Municipal Council Market in Nakuru is a practical scenario where each trader has a mobile phone for business communication

Dear Benard, I would be keen to learn more about how the use of mobile phones by traders has affected farmers and their productivity. Torbjörn [quote="oderoboa"] [quote="Lisa-Cespedes"] Question 2 (8 Dec.) What positive impact can ICT have on the agricultural value chain? Where in the value chain can ICT reduce transaction costs? [/quote] ICT is likely to be one of the biggest revolution that will change the literal and business environment of agriculture. The Municipal Council Market in Nakuru is a practical scenario where each trader has a mobile phone for business communication [/quote]

Hi Mohamed, What concrete evidence is there that telebanking or m-banking in the agricultural value chain has led to reduced transaction costs? Are you aware of any such studies? Kind regards, Torbjorn [quote="alasow"] Hi, ICT can reduce transaction through telebanking. (If the illitecary complex among rural residents is taken care of, through empowering with ICT itself using the mobile phone, the telecenters etc.) ICT reduces transaction costs if regular information on commodity pricing is availed to the rural people and loan systems are structured through ICT, so that it becomes important for the rural people to demand for ICT education. It also reduce transation costs by eliminating the middle-man factor. Mohamed [/quote]

[quote="Lisa-Cespedes"] Question 2 (8 Dec.) What positive impact can ICT have on the agricultural value chain? Where in the value chain can ICT reduce transaction costs? [/quote] There probably are numerous ways in which ICTs can reduce transaction costs. It is clear that theoretically they could help bring the producers closer to the markets and vice versa - in practice, cultural and historical factors can reduce this effect as has already been demonstrated in some studies on the traditional roles of middlemen. Middlemen tend to be slightly demonized as in theories on value chains, and are often portrayed as reckless profiteurs from poor farmers. In many african countries though, the play a role in traditional prefinancing schemes, inputs procurement, market information provision and relationship building between the small farmers and bigger traders. In itself, having access to market prices via ICT does not always help small farmers to conclude better deals - as access to transport, packaging and uniformity of quality can hinder the conclusion of good deals. But in the case of organized farmers' organizations, it can definitely help to set quality standards of the products, facilitate grouped sales, facilitate grouped and uniformized packaging, temporarily stockage (in order to sell at the best moment) etc. I'm also inclined to say that the question is too open - as if all the actors in the chain would profit equally from the use of ICT at certain points in the value chain. So for me, the ground question would rather be: who benefits most from specific ICT interventions in the value chain? This question then also better relates to the underlying objective of poverty reduction: who do we need to support with ICT's (and at what level) in order to reduce and/or ban poverty?

ICT technology has been developed to improve human life and to help farmers to do better focusing on high yields. One of the main advantage ICT brings to the value chain is to reduce time and costs of transaction due to accessibility to communication means that can improve the information flow between and along the value-chain of agricultural products. The place where transaction costs are reduced is between the industry and the consumers, thoubh both of them can access to information more direct through different means of communications.

[quote="sapnaaroranarula"] The impact of ICTs on the agri value chain are multifarious. Let us analyse it in two ways ; Impact on backward linkages: The ICTS can assist in providing relevant information about procurement of agri-inputs, prices of agri-inputs and also the launch of new products and brands. They can be aware of new technologies / good agricultural practices. ICTs can also make the farmers aware about the various various Government schemes on agriculture finance/ health etc. Impact on forward linkages: ICTs can really help the farmers to link to the markets.First, they can be aware of the new markets , domestic as well as exports and can reach the alternative channels Next, ICts can help in price discovery and this is the most important area as far as farmers of developing countries are concerened as due to lack of awareness of prices prevalent at various mandis ( agricultural markets) they are unable to sell their produce at premium prices All this can really help to make the chains efficient and systems more transparent and empower the farmers in these countries. Please feel free to ask or share anything Thanks Sapna [/quote] Thank you Sapna for the nice points.Could you please elaborate some of the benefits with specific examples if possible with quantative terms?

Dear Dr. Zainul, with respect to your question as to examples where ICT have been used, I give below the following Reuters market light: Throgh SMS it has helped to plan farmers in punjab styate of india their crops. Noe they get info of weather, markets and prices and hence are able to earn more profits. As a result of this, more and more farmers are subscribing to this paid service. I will share some more models in other post. Sapna

[quote="flaureys"] Middlemen tend to be slightly demonized as in theories on value chains, and are often portrayed as reckless profiteurs from poor farmers. In many african countries though, the play a role in traditional prefinancing schemes, inputs procurement, market information provision and relationship building between the small farmers and bigger traders. [/quote] Hear! Hear! The same evidence on the usefulness of the middlemen can be found in Asia. What is more, market intermediaries (we shouldn't forget "middlemen" are very often "middlewomen" in many countries of Africa and Eastern Asia) are often the only outlet available for communities in [u]remote areas[/u]. Detaining information through ICT about a more favourable price in the city market will not really improve farmers' bargaining positions with the trader if that trader is the only one ready to bear the costs of doing business with the remote community. Rather than a tool for bypassing the market intermediary, I would propose ICT (and other supply chain management tools, for that matter) be used to strengthen the sustainability of business relationships between existing value chain stakeholders, which should lead to greater chain performance, according to most of the empirical data from supply chain management studies - including those in developing countries. Jo

Hi All Let me to share with you outcomes of a interesting research done by LIRNEasia, a research organization in Sri Lanka. The research was on Cost of Information in agriculture markets, with special reference to "Dambulla" a whole sale vegetable market in Sri Lanka. Findings; Transaction cost -> 15% of the total cost of production Out of that 15% Transaction cost -> 70% is Cost of Information That is the cost of traveling and searching information, which could have minimized with the support of ICT. I do not try to generalize the findings of a research done with Sri Lankan vegetable farmers to whole world, but this research help us to understand the potential role ICT can play to minimize the Transaction cost. Sameera.

[quote="Lisa-Cespedes"] Question 2 (8 Dec.) What positive impact can ICT have on the agricultural value chain? Where in the value chain can ICT reduce transaction costs? [/quote] ICT can assist farmers in meeting compliance requirements. We were visiting a supplier that's a co-op of farmers in the Mekong Delta in Vietnam. They're growing rice that meet Global GAP standards. They showed us books of records of information by each of the 500 families, with entries after entries for compliance purpose. ICT could enable the recording as well as checking of that data to be a lot easier and less time-consuming.

Further to the discussion on the theme, there is an excellent example of ITC, india's conglomerate starting an ICT initiative i.e. e-chaupal, The company is providing computers to the farmers in villages and giving them data on all aspects of value chain i.e. weather, crop advisory and agriinputs along with data on commodity prices and arrivals.At the same time, company is procuring the produce. it has infact empowered the soyabean and tobacco farmers so that they are free to sell their produce, where they have maximum margin. The uniqueness of this project is that it is commodity-specific Sapna

[quote="Lisa-Cespedes"] Question 2 (8 Dec.) What positive impact can ICT have on the agricultural value chain? Where in the value chain can ICT reduce transaction costs? [/quote] ICTs save time and costs that maybe encountered using traditional ways. Instead of travelling to remote areas to share information to farmers, one can make a phone call. ICTs have also positive impact on the agriculture value chain in that a farmer can make a transaction in the comfort of his home or office using the internet of phone. It does'nt always require face to face communication when using ICTs.

This is a very interesting scenario Thao. Have you, or has anyone, looked at the epidemiological applications of ICT (rural e-Health programs) to see what experiences there could be transferred to agriculture? Improving and simplifying compliance in data collection seems to be a common goal. [quote="Thao"] [quote="Lisa-Cespedes"] Question 2 (8 Dec.) What positive impact can ICT have on the agricultural value chain? Where in the value chain can ICT reduce transaction costs? [/quote] ICT can assist farmers in meeting compliance requirements. We were visiting a supplier that's a co-op of farmers in the Mekong Delta in Vietnam. They're growing rice that meet Global GAP standards. They showed us books of records of information by each of the 500 families, with entries after entries for compliance purpose. ICT could enable the recording as well as checking of that data to be a lot easier and less time-consuming. [/quote]

[quote="sameera"] Hi All Let me to share with you outcomes of a interesting research done by LIRNEasia, a research organization in Sri Lanka. The research was on Cost of Information in agriculture markets, with special reference to "Dambulla" a whole sale vegetable market in Sri Lanka. Findings; Transaction cost -> 15% of the total cost of production Out of that 15% Transaction cost -> 70% is Cost of Information That is the cost of traveling and searching information, which could have minimized with the support of ICT. I do not try to generalize the findings of a research done with Sri Lankan vegetable farmers to whole world, but this research help us to understand the potential role ICT can play to minimize the Transaction cost. Sameera. Hi sameera, Thanks for this information [/quote]

[quote="sapnaaroranarula"] Hi sameera, Thanks for this information [/quote] You are welcome Sapna. I am really glad to meet you on this e-agriculture forum again to share knowledge on ICT4Agriculture. @ Pretty Here in Sri Lanka, Dialog Telekom, a telecommunication company has introduced a mobile payment method called eZ Pay (pronounce it as easy pay). With that system any buyer can make a payment to a farmer instantly within Sri Lanka just using his mobile phone. So there is no risk of farmer carrying money. Beauty of this system is you do not want to have computers, internet, etc. (which most of the time can not be afforded by poor farmers). Just having a mobile phone with a bank account would do. -Sameera.

[quote="sameera"] Let me to share with you outcomes of a interesting research done by LIRNEasia, a research organization in Sri Lanka. [/quote] Thanks for sharing this example with quantitative data Sameera. For those of you interested, the report by LIRNEasia is linked in the forum's Resource thread at: http://www.e-agriculture.org/mm_forum.html?&tx_mmforum_pi1[action]=list…