African food markets need overhaul as farmers struggle to reach consumers

KIGALI, Rwanda — Africa cannot build viable farming businesses without fixing the markets where agricultural goods are bought and sold, participants at a panel on agricultural transformation have warned.

Sara Mbago-Bhunu, Director of the East and Southern Africa Division at the International Fund for Agricultural Development, said governments and development partners needed to move beyond investing in production and start addressing the weaknesses that prevent farmers from accessing functioning markets.

She said many African markets lacked basic infrastructure such as refrigeration, internet connectivity and banking services, while vendors often operated outside formal market facilities.“Many of the vendors you find sitting outside the infrastructure,” Mbago-Bhunu said.

“There’s no point of investing in the market infrastructure when the vendors are actually outside.”The criticism came as panellists explored how agriculture could become a business capable of generating income and employment for a rapidly growing African population.

Mbago-Bhunu said markets were poorly governed in many countries and needed to be treated as a critical part of agricultural infrastructure rather than as an afterthought.

Many existing urban markets, she said, were not standardised and lacked basic services required to handle agricultural products efficiently.

She proposed modular improvements that could add refrigeration, internet and banking services to existing markets rather than relying exclusively on expensive new infrastructure. The panel also raised concerns about the way imports affect domestic agricultural producers.

Mbago-Bhunu said there were cases where countries imported large volumes of commodities such as tomatoes even when domestic farmers and commercial producers were struggling to gain access to supermarkets.

“Sometimes we’re importing large volumes of tomatoes which are not necessary,” she said, while domestic farmers could not get into formal retail markets.

The problem, she argued, was not simply production but the structure of agricultural markets and the relationships linking farmers to retailers and consumers.

The solution, she said, should include stronger markets directly owned and managed by smallholder farming communities, alongside greater use of digital systems.She pointed to Kenya’s e-voucher programme as an example of how digital systems could connect smallholder farmers with input suppliers.

According to Mbago-Bhunu, the programme had brought hundreds of agro-dealers into a network capable of improving farmers’ access to inputs where they lived.The discussion reinforced a central theme of the panel: farmers cannot be expected to treat agriculture as a business unless the surrounding commercial infrastructure exists.

Anup Jagwani, Global Director for Farming and Agribusiness at the World Bank Group, said the sector faced a difficult balancing act because governments wanted affordable food for consumers while also ensuring farmers received adequate returns.

Agriculture, he said, remained a risky business because of factors including climate and production uncertainty.

Governments and development partners could reduce that risk through measures such as irrigation, improved seeds and insurance, he said.But higher returns for farmers could not simply come from pushing food prices upwards.

“The only way to do that is by increasing the size of the pie,” Jagwani said.

That means creating more value through the agricultural chain, including processing, logistics, technology and other activities around production. The panel therefore framed market reform as central to agricultural transformation.

Without functioning markets, investments in irrigation, mechanisation, inputs and production risk creating more food without creating viable businesses.

And without viable businesses, African agriculture will struggle to deliver the jobs and incomes needed by a rapidly growing population.