A new generation of cooperatives for Africa

Abstract

How to transform rural communities and farmer associations in Africa into modern and competitive enterprises, while preserving cooperative principles? How to develop democratic and farmerowned cooperatives that can also boost agri-business?

40% of agricultural commodities produced in the European Union (EU) are marketed through cooperatives. While in Africa, less than 5% of the agricultural surplus is sold through cooperatives. This shortfall is not due to lack of farmer cooperatives over the African continent. Here, every other rural village has at least one cooperative. Low commercialization by African cooperatives is due to “side-selling”, as member-farmers prefer quick, farm-gate and arm-length transactions with itinerant middlemen.

Side-selling by member-farmers disrupts internal cohesion in cooperatives and affects the capacity of these organizations to vertically integrate into value chains and become viable businesses. A large body of research recommends African farmers to market their produce collectively, through cooperative organizations, in order to increase revenues for member-farmers. Hence, the main challenge for African Cooperatives is to convince their farmers to engage in collective marketing.