November 6th, 2015
On the 3rd of November, I participated in the Innovation Forum on Renovation & Rehabilitation of Smallholder Tree Crops (abbreviated as ‘R&R’). The forum was attended by over a hundred decision makers and experts from sectors which are largely dependent on smallholders; coffee, cocoa, palm oil and tea. The focus of the forum was on sharing experiences, lessons learned, cross-sectoral knowledge sharing and defining best practices for (financing of) smallholder R&R.
During the day, IDH presented its report ‘A Review of the State of the Emerging R&R Market and Opportunities to Scale Investment’. The report concludes that “approximately 14 million hectares of land harvested by smallholders for cocoa, coffee, palm oil and tea worldwide, or 6.5-7.0 million smallholder farmers, would benefit from R&R if such services could be made affordably available to them”. R&R is different from training or supply of inputs, which are more short- to medium-term investment, but focuses solely on long-term impact on crop productivity.
Although smallholders are of vital importance for the future of the cocoa, coffee, palm oil and tea sectors, investment in R&R has been difficult to bring to a sufficient scale. This leads to a substantial financing gap for smallholder R&R outside large-scale plantations, related to general challenges in smallholder finance; a barrier for agricultural sustainability. However, as noted by the IDH report, in the last few years “there has been substantial innovation in R&R program design and smallholder finance that is being brought together by a range of actors, and in ways that could attract new sources of capital to achieve scale”.