Marketing and Marketing Linkages for Rural Producer Organizations in Tanzania

Abstract

Rural Producer Organizations (RPOs) in both Tanzania and at the regional level are formed around food and non food crops. During the colonial period, the attention for structured marketing was on selected agricultural commodities and mainly those, which were internationally demanded. Those commodities included coffee, cotton, sisal, tea, cashewnuts and tobacco. Such commodities still command international demand to date. In Tanzania, coffee, cotton, cashewnuts and tobacco, command international market supremacy although at different degrees. Strong RPOs were built around cotton, coffee, cashewnuts and tobacco because the production of such comities was adaptable to smallholder investment and technological capacities. While in very few cases, the rural producer organization targeted production, most RPOs in Tanzania which emerged during the colonial era and even after independence, were geared to make positive intervention in the marketing of commodities produced by the members. The market and marketing intervention by RPOs was aimed at resolving two types of problems: - first, to remove the Asian middlemen who bought low and sold high, reaping higher profits than the real producers. Secondly, while marketing was a manageable activity, RPO intervention sought to cut down operational and transaction coast both the physical activities of marketing as well as on financial services (Khaila 2004). The logical framework of all marketing cooperatives for example, was built on the fact that the members, through their RPOs, would wield market power by quantity and quality and hence play a monopolistic role through the achievement of economies of collection, transport, financial as well as technological services. The market intervention by RPOs was not tested in the plantation-based production systems in sisal and tea. A clear reason, as to why this was not the case, is the nature of heavy investment and technological complexity that was beyond the reach of smallholder farmers individually and at group level. In tea production however, co operatively organized out grower systems, have been encouraged with marked success. In the sisal industry, smallholder sisal production is also emerging. on individual initiatives and through the promotional efforts of the Tanzania Sisal Growers Association. Apart from the so-called cash crops, RPOs were marginally involved in the marketing of food and horticultural crops. The main food crops include maize, rice, oil seeds and millet. Horticultural crops include bananas, fruits and vegetables. Group action has had very little involvement in diary, chicken and other production and marketing systems. this study will 100k into the marketing structures of cash and food crops in rural areas