How Do You Define a Sustainable Partnership?

Batourey Abdoulaahi 2.jpgWe asked Batourey Abdoulaahi, farmer and agribusiness coach from Tapoki village in northern Nigeria where IFDC’s 2SCALE project, in partnership with Nestlé, implements the Sorghum and Millet in the Sahel (SMS) project, with the goal of improving the quality and yields of these crops and developing farming as a sustainable business.

But what is sustainable business? According to Batourey, “Everybody needs to find his or her profit. A business that is profitable is by nature a sustainable business.”

In most African countries, farmers usually work individually. Why did you decide to come together through clusters?

Before, we were operating individually, and we discovered that we lost a lot synergy because we need help from each other in term of experience, capital and even influence. Coming together appeared to us to be the best way to face our common challenges. I now belong to a farmer cooperative group, and I’m now head of an umbrella composed of four clusters. The clusters include four other cooperative societies and bring together sorghum and millet famers, input dealers, retailers, and aggregators. For example, when we come together, we are able to access the government agencies and other partners to assist us in our farming activities. We also better negotiate with our buyers as a group than we do individually.

What would you say were the top challenges you faced before joining 2SCALE through the SMS project?

Initially, in this part of the country, we didn’t produce white sorghum, but when we joined the SMS project, we had the insight that white sorghum was very profitable. Initially, our first challenge was having access to a ready buyer. When we produce, where to do we sell? That was a big issue.

Our second challenge was access to correct seed, hybrid seed, which is disease resistant and high yielding. The third issue was capital. As a farmer, you need enough capital to produce, because farming now is just as any other business. Another hot issue was access to inputs such as fertilizer. Event though we used to have access to fertilizer in the open market and through government programs, we lacked the knowledge and skills to identify a genuine fertilizer and how to properly use them other chemicals such pesticides and herbicides. Last but not least, we also lacked experience to manage our groups. Before the SMS project we had administrative challenges because organizing people is not easy when you deal with different cooperative societies from different places, different visions and different interests. You need strong management skills to make all the groups work together and make them function as a group. So when the SMS project started they gave us leadership training, and that gave us a lot knowledge and skills on how to organize ourselves. We have four cooperative societies that function together as a cluster, under a particular leadership based on transparency and fairness. Managing a group requires some organizational and administrative skills because when you bring different people with different visions and interests, it is extremely challenging.

What where the key actions undertaken under the SMS project to face these challenges? What would you consider key achievements, and what are the areas where you could not improve the situation?

The first achievement is the knowledge we gained on how to produce white sorghum. Our farming techniques, like broadcasting fertilizer instead of micro dosing, were outdated and ineffective. The project introduced modern techniques that farmers now widely use. These innovations include spacing of seedlings and good application of fertilizer. In the past, because of our outdated farming techniques, we only harvested ten bags of hundred kg per hectare. With the new skills we have, we can now harvest up to 25 to 30 bags per hectare. We also complained about local finance. The project was able to teach us how to deal with it through in internal saving combined with soft loans from a micro-finance institution.

Batourey Abdoulaahi 1

As for as access to market is concerned, the project opened our mind that no matter the volume we produced for white sorghum, there is always a buyer – like Nestlé, which specializes  in producing children’s products. Before Nestlé, there were other companies who were willing to buy white sorghum from us, but we had to transport the product to the market. And if the negotiations failed, we had to take the product back home. This often resulted in loss of money and quality. Nestlé would come to buy it through a collector to whom we sell as a group, based on off-take contracts we sign even before we start producing. The difference is that on the open market, there is no guarantee to sell, and the prices are not steady. So to avoid taking their product back home, farmers sometime sell their harvest at very low price. With the new arrangement, no matter the volume we have, we can sell it at good price and at any time. However, this market is much more challenging because it requires a very good quality crop.

How do you deal with the high quality standard that this kind of contract requires?

We are trained to meet this quality standard. We are trained on tracking, post-harvest management, cleaning, and storage to assure good quality. In the past we used to store produce in warehouses that are not suitable for storage, and we used to apply chemicals to protect the crops.

How did you solve the finance issue, if you could solve it?

Our cooperative is composed of 115 farmers. Since we started the SMS project, we were able to raise a loan for 60 farmers to purchase input. The volume of 3 million Naira was achieved, ant this was the very first time we dealt with a bank successfully, as the money was successfully repaid because of the leadership within the cluster. We know what everybody does from the sowing to the harvest, and we follow up at each stage to make sure everybody repays their loans.

What would you say is the specific added value of the SMS project?

I think it’s the various trainings we receive and the establishment of a business relationship with farmers, input buyers, traders, and other external partners. This is a real innovation in how we do farming. We are now trained in financial and economic analysis, which are widening our view. We now have strong skills in negotiating with our partners. We learn how to maximise our profits and to reduce our marketing cost. We went through business analysis and business innovations with ICRA. The second training was financial analysis. How can you raise funds for your business, both internally and externally? And when you finance, how do you manage it? The third training was about economics analysis. It concerns production techniques and marketing. What are the techniques to produce high yields and ensure quality? And when you achieve a good yield, how do you market it? Through which channel?  You know, when we now meet the aggregator that buys from us, we don’t give them the product. We need to maximize our turnover and profit. We go into a round table discussion and say, OK, this the way you are going to take the product from us. It’s business, business all the time.

What is the guarantee that this achievements will be sustained, after the project?

The guarantee is that we are making very high profits by producing white sorghum. Everything you are doing, you need to have benefits, and the profits we are getting are our guarantee that business will still run. I use the term business because farming is a business like any other business. This is how we look at it, and this the guarantee it will last long.

 

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