Vegetables in Intibuca, Honduras
Vegetables in Intibuca, Honduras
The food retail industry in Central America is dominated by a small number of supermarkets. Their involvement is therefore key to making the vegetable market more inclusive and sustainable. A fair relationship between farmers and companies, as well as better prices, would ensure the continuity of the farms, securing the food chain and giving the producers enough additional revenue to invest in environmentally-friendly technologies. We believe these steps are necessary to fight climate change and feed the growing urban population. The Honduran vegetable market is still mainly informal. However, in recent years, the formal market has expanded and become more significant. It now represents 20% of the market share. In the future, supermarkets such as La Colonia, Walmart and La Antorcha will continue to increase their influence in the region. A stable commercial chain would be a win-win situation for both sides, as farmers would have stable prices and the supermarkets would not need to import vegetables from other countries.
ASOFAIL is a farmers’ organization founded in 1997 in the district of Intibucá, Honduras. Walmart has been supplied by ASOFAIL since 2010. La Colonia also had deals with them but this stopped in 2012. ASOFAIL currently has 305 members, but not all of them participate in the chain. Members participating in the fresh vegetable chain receive technical assistance, inputs and training from the cooperative, which also coordinates them to ensure a stable and varied production all year round.
The chain is promising, selling an average 9,000 units of vegetables per week, but is based on an informal agreement and the cooperative struggles to cover Walmart’s demand. VECO’s objective is to strengthen the cooperative and at the same time make it accessible to women and younger farmers. To achieve the latter objective, a joint project was launched by VECO, ASOFAIL and COMRURAL in 2013. The pilot project targets producers aged under 35 who want to be involved in the chain, offering them a viable business plan and finance to install irrigation systems and greenhouses. Nearly all of the farmers own the land they cultivate: only 4% rent it. About half of the farmers’ revenues come from vegetable production. On average, they have 0.77 hectares per plot but only use half of it, so the opportunities for expansion are plentiful. Their farms are accessible by road and 80% are connected to some form of public transport. Most buildings have running water but no electricity. Most houses need to be secured because they are situated in a region vulnerable to landslides.
- Only 30% of farmers have access to the credit necessary to make investments and buy inputs.
- The central warehouse lacks essential equipment such as a refrigerated room.
- ASOFAIL and Walmart do not communicate effectively. As a result, decisions regarding prices and other matters are taken unilaterally by Walmart.
- Very few farmers use Good Agricultural Practices: most of them prefer traditional methods, but without stable year-round production and a GAP certificate their participation in the chain is endangered.
- High incidence of pests and plant disease.
- Transportation is expensive and refrigerated trucks are not used, which is a risk.
- ASOFAIL has no negotiating power because its market knowledge is insufficient and it only has one client.
- Women and youth presence in the chain is minimal.
- Most of the fields have an irrigation system but some of them are quite inefficient.
- To solve the credit problem, we promote the partnership between ASOFAIL and CACIL (a credit cooperative) so that farmers can acquire the funding necessary to invest and buy inputs.
- We work to strengthen the relationship between ASOFAIL and WALMART, and at the same time we search for other buyers.
- To increase productivity we organise training on Good Agricultural Practices for farmers.
- To prevent diseases and secure stable production, we promote protective techniques such as greenhouses.
- We encourage the farmers to apply for a GAP certificate, explaining its importance for future contracts.
- To improve the post-harvest process we buy essential equipment for the warehouses and we ensure it is correctly used by providing a Good Management Practices manual.
- We promote participation of women at all levels in the chain.
- To increase youth participation, we support a pilot programme that helps producers under 35.
- We promote drip irrigation to replace less efficient irrigation systems.
- More than half of the producers have access to credit from one source or another.
- ASOFAIL is in negotiating with Los Andes Supermarket.
- Two oral agreements with two supermarkets La Colonia and Walmart
- Sales have increased in 20%
What do we expect in the long-term?
- The Honduran vegetable market will become more sustainable as other companies follow Walmart’s example.
- The strong percentage of young producers will secure the future of the organisation.
- There will be equality in the chain.
- The new techniques will make the farms more resilient to climate chance.