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Smallholder Agriculture in Developing and Emerging Economies: The Case of Sri Lanka

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Sustainable Food Value Chain Development

Abstract

Smallholder farmers in Sri Lanka are engaged in plantation crops, non-plantation crops or livestock sectors. Tea, rubber, coconut, sugarcane, vegetables, fruits, paddy, broiler chicken, ornamental fish, and prawn culture are quite prominent smallholdings sectors in the country. Smallholder agriculture in Sri Lanka faces a range of challenges, emanating from natural environment as well as the business environment that can determine its performance. The place of smallholder agriculture in rural as well as urban economies and its impact on food security, poverty alleviation, good health and well-being of people are important. Trade plays a crucial role in Sri Lanka in making food products available to consumers everywhere. It has the ability of ensuring food security. There have been recent trends in the trading of agricultural products in Sri Lanka. The food security situation was crucial during the recent pandemic of COVID 19. Agricultural production and trade were affected severely causing temporary food insecurity during the early stages of the pandemic in Sri Lanka, mainly due to disruption in the village collection systems. However, trading mechanisms which were not popular during the pre-pandemic era, such as local mobile selling, hawkers, door-to-door selling, and road-side selling, were adopted by smallholder farmers themselves and small-scale village traders during the pandemic. Vulnerabilities in the production of food and the changes in the policy environment have an impact on food trade. Contract farming plays an important role in reducing some vulnerabilities in smallholder agriculture in Sri Lanka. Smallholder farmer institutions in Sri Lanka are mainly a vehicle for smallholder farmers to access modern markets in collaboration with agribusiness partners. Farmer cooperatives, agrarian and Mahaweli farmer organizations, farmer companies, and tea smallholders’ development societies are some smallholder farmer institutions established in Sri Lanka. Smallholder farmer institutions in Sri Lanka could perform better if they avoided some of the common inherent problems they display. This chapter provides six general recommendations for the establishment of stronger and sustainable smallholder farmer institutions.

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Notes

  1. 1.

    Contract farming is also known as out-grower farming in Sri Lanka.

  2. 2.

    This is the price received by the farmer (farm-gate price) as a percentage of the price paid by the consumer (retail price).

  3. 3.

    Pola is a traditional rural marketplace in Sri Lanka. There are a large number of smallholder farmers and village collectors bring mainly agricultural commodities as well as other groceries for sale at the Pola. The infrastructure is generally provided by local authorities in the respective areas. Pola is held on a specific day of the week in a particular location.

  4. 4.

    Committee on Food Security is an international and inter-governmental platform established by the UN to ensure food security and nutrition for people. It works with its stakeholders and reports to the UN and FAO.

  5. 5.

    Defined by the UN; Department of Economic and Social Affairs, Sustainable Development.

  6. 6.

    Road-side shops became a common retail marketplace during the COVID-19 pandemic. Many of these shops are not registered with authorities. They sell food items mainly vegetables, fruits, dry-fish etc. Some of the items are the harvest of local smallholders and home gardens. These shop-keepers also buy items from transport agents who transport food items from other areas of the country.

  7. 7.

    An ancient type of highland agriculture where slashing, burning and cultivation was practiced. Farmer groups deter pests and obtain mutual help in agronomic practices in the chena cultivation. Agrochemicals were not used in this method. This is very seldom practiced at present.

  8. 8.

    An institution established with a social or an institutional influence for collective action.

  9. 9.

    Farmer Companies (FCs) in Sri Lanka were initially registered under Part VII of the Companies Act, No. 17 of 1982, which provided for the establishment of ‘Peoples Companies’. This Act was later replaced in 2007 by a new Companies Act No. 07 of 2007 and all FCs were required to re-register under the new Act.

  10. 10.

    A complete account of the generic institutional problems can be found in Sykuta and Cook (2001).

  11. 11.

    This is also called side sales.

  12. 12.

    Facilitation can be defined as all the activities and functions that an external institution or a group of institutions undertake in the process of establishing a farmer institution. Such institutions that provide the facilitation is known as a facilitating institution. In Sri Lanka, these are usually state organizations related to agriculture.

  13. 13.

    Many of these individuals started as small-scale traders after having their jobs lost during the pandemic due to lay-offs and temporary stoppage etc.

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Authors and Affiliations

  1. Sabaragamuwa University of Sri Lanka, Belihuloya, Sri Lanka

    H. S. R. Rosairo

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  1. School of Management Studies, Nalanda University, Rajgir, India

    Sapna A. Narula

  2. Distinguished Professor, Whitman School of Management, Syracuse University, Syracuse, NY, USA

    S. P. Raj

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Rosairo, H.S.R. (2023). Smallholder Agriculture in Developing and Emerging Economies: The Case of Sri Lanka. In: Narula, S.A., Raj, S.P. (eds) Sustainable Food Value Chain Development. Springer, Singapore. https://doi.org/10.1007/978-981-19-6454-1_13

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