EMERGING CHALLENGES FACING SMALLHOLDERS 7
the capacity of smallholders to step up their production and to bring the increased output to market (making use of storage and transport). Evidence from Ghana shows that higher maize prices have the largest adverse welfare effects on urban, female-headed, poor, and small farm house- holds because these groups are traditionally net buyers of maize (Minot and Dewina 2013). Similarly, recent stud- ies in Bangladesh and Malawi show that an increase in the price of staple crops—rice and maize, respectively—results in a higher welfare loss for small landholders compared with larger landholders (Karfakis et al. 2011). Te impact of price fluctuations also depends on other household characteristics, including off-farm income and the income linkages between buyers and sellers (Aksoy and Isik- Dikmelik 2011). At the same time, an analysis of household data from
before and aſter the 2007–2008 food price crisis in Indone- sia shows that the crisis created “forward-looking incentives” for farmers to increase investments in productive assets (Nose and Yamauchi 2012). Rising food prices translated into higher investments by both large and small farmers, with higher prices and the resulting higher incomes partly relieving credit constraints among smallholders. Tese find- ings also reveal, however, that unanticipated price shocks had a smaller positive impact than anticipated shocks. Tis means that although some smallholder farmers with mar- ketable surplus stand to profit from rising food prices, the volatility and uncertainty of prices make it difficult for them to take advantage of these opportunities. Te uncer- tainty concerning future food prices raises questions about smallholders’ future income and risks as both producers and consumers.
NUTRITION AND HEALTH
Agriculture, nutrition, and health are closely linked, and smallholders play an important role in this relationship (as both consumers and producers). Shocks to the health and nutritional status of smallholder farm households have been shown to reduce these households’ ability to under- take more productive and innovative activities that generate food and income (for an overview, see Fan and Pandya- Lorch 2012). Tis is largely because such shocks lead to losses in physical and financial assets and work capacity and skills. Nutrition has a particularly significant influ- ence on the relationship between health and agricultural
productivity. Nutritional deficiencies—especially in terms of micronutrient intake—impair farmers’ productivity through poor physical health, inability to innovate, and poor cognitive development (Ulimwengu et al. 2011). Health shocks and the subsequent loss of agricultural pro- duction capacity can also lead to changes in cropping pat- terns and diminishing crop diversity. Affected households may switch to less labor-intensive crops—such as root crops—that also oſten have lower yields, lower economic value, and lower nutritional value, starting a vicious circle of ill health, poor nutrition, and low productivity (Barnet and Rugalema 2001; UN 2004). Development efforts over the past several decades have focused on providing an adequate supply of food through improved agricultural productiv- ity, but they have failed to deliver adequate quantities of nutritionally balanced food, especially to poor people. For example, strategies to increase food production during the Green Revolution were disproportionately concentrated on productive cereals at the expense of more nutrition-dense crops and placed litle focus on increasing nutrient intake and human health (Welch and Graham 1999). As developing countries’ populations grow larger, richer,
and more urban, the intensification of agricultural produc- tion will occur in rapidly changing agrifood value chains (Reardon et al. 2009). Increasingly globalized and liber- alized agrifood markets are dominated by supermarkets, distributors, processors, and agro-exporters that are intro- ducing and expanding food safety and quality standards that many smallholders are unable to meet. Tese developments are further shiſting the competitive advantage away from smallholder farmers toward large-scale producers. At the same time, more intensive agricultural practices will have significant implications for food safety, disease transmis- sion, and environmental sustainability. In fact, the presence of contaminated food in the food distribution chains and the transmission of zoonotic diseases, such as avian influ- enza, is already an emerging public health concern in many developing countries. In China, for example, the contamina- tion of milk and baby formula, which sickened an estimated 300,000 people, has been linked to the rapid and unregu- lated development of the dairy sector (Pei et al. 2011).
CLIMATE CHANGE
Climate change is likely to increase the vulnerability of many poor rural communities. Given their already weak
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