Supporting

Smallholder Farmers
in Crisis
The impact of COVID-19 on TechnoServe’s
smallholder farmer clients

Internal document; v1
Last modified: May 1, 2020
Table of Contents
Background & Purpose 3
Macro-level insights on COVID-19 impact on agriculture, food systems, and smallholder
farmers 4
Ground-level insights on the impact of COVID-19 on our smallholder farmer clients
today 7
What does this mean for TechnoServe’s priorities? 10
What should TechnoServe do? 12
What’s next? 15

2
Background & Purpose
Through our agricultural programs, TechnoServe supports women and men across the developing
world to earn higher incomes through opportunities in agriculture. In 2019, TechnoServe’s
agricultural programs supported 204,000 smallholder farmers (39% women) around the world to
access opportunities in agriculture and earn $105 million in increased revenue as a result.

The COVID-19 health pandemic is impacting our agricultural programs, and the women and men
who rely on them, in a variety of ways. As governments around the world enact strict measures to
halt the spread of the virus, farmers are struggling to carry out day-to-day activities, and the
majority of our program teams are unable to carry out planned activities or provide support to
farmers in-person. In addition to facing these new challenges, farmers are left feeling anxious
about maintaining health for themselves and their family.

In this document, we outline how we expect COVID-19 to impact smallholder farmer clients, and
present our recommendations for shifting objectives and priorities in existing TechnoServe
programs to help them weather the crisis and emerge more resilient than before. This document
will be followed by toolkits and other write-ups to support teams in taking concrete actions,
within each priority area, and leverage best practices within the organization.

It’s important to note that this is a preliminary document: the economic effects of the pandemic
are not yet entirely clear and are likely to evolve over time. Further, we are continuously learning
during this unprecedented situation, and as we innovate our programming in response, we will
share our insights along the way.

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Macro-level insights on COVID-19 impact on agriculture, food systems, and
smallholder farmers

COVID-19-related lockdowns have already led to plummeting incomes for millions around the
world. By the end of March 2020, well over 100 countries around the world had imposed full or
partial lockdown, disrupting the movement of billions of people around the globe.1 The ILO
estimates that almost 2.7 billion workers, representing 81% of the world’s workforce, have been
impacted by full or partial lockdown conditions, and as of April 1, 2020, the combination of
layoffs and reduced working hours led to a contraction in employment equivalent to the loss of
195 million full-time workers.2

While rural areas and the agricultural sector are considered lower risk sectors in terms of job
losses in the short term, smallholders are not insulated from immediate shocks to daily incomes,
as a result of measures aimed at containing the pandemic. Estimates suggest that smallholders
generate between 14% and 34% of their incomes outside of farming activities, including
agricultural and non-agricultural wage labor, informal trade, sale of home-made goods, and
transfers and remittances.3 On average, farm size in most African countries, with the exception of
a handful of land-abundant countries, has declined by 30% to 40% between the 1970s and the
early 2000s – increasing reliance on non-farm sources of income.4 A sharp drop in transfers and
remittances has been predicted, and as rural areas undergo measures to limit contagion, including
closure of markets, closure of regional and cross-border trade, restriction on movement and
informal vending, and closure of businesses, farmers will see other forms of daily income at risk.5

There is consensus that this pandemic will push the world into a global recession. The World
Bank has estimated that global output is projected to contract by 3% in 2020. In Sub-Saharan
Africa, decreased economic activity and disruptions in the global economy, caused by COVID-19,
are likely to push the region into its first economic recession in 25 years, with growth predicted in
the range of -2.1% to -5.1%, down from pre-COVID-19 forecast of 3.4%.6

In the developing world, the global recession is likely to be accompanied by increasing levels of
poverty and food insecurity. The World Bank has estimated that COVID-19 is likely to cause the
first increase in global poverty since 1998, pushing between 40 to 60 million people into extreme

1
https://www.bbc.com/news/world-52103747

https://www.ilo.org/wcmsp5/groups/public/@dgreports/@dcomm/documents/briefingnote/wcms_740877.p
df

3
https://www.worldbank.org/en/news/press-release/2020/04/22/world-bank-predicts-sharpest-decline-of-
remittances-in-recent-history

4
Headey and Jayne, 2014
5
https://www.worldbank.org/en/news/press-release/2020/04/22/world-bank-predicts-sharpest-decline-of-
remittances-in-recent-history

6
https://www.worldbank.org/en/news/press-release/2020/04/09/covid-19-coronavirus-drives-sub-saharan-
africa-toward-first-recession-in-25-years

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poverty in 2020, principally in Sub-Saharan Africa and South Asia. The WFP has put out a strong
warning that physical and economic barriers to food access resulting from the COVID-19 crisis
can potentially have a catastrophic impact on food security for millions around the world,
particularly those already in vulnerable situations. While smallholder households produce a large
proportion of food consumed, they also tend to purchase food. Physical barriers and falling
incomes resulting from measures to contain the virus have already put pressure on food access for
many, and it is very likely that food insecurity will become more severe as the economic impact
of this crisis extends and deepens.

The economic crisis will put pressure on food and agricultural systems in developing countries,
with direct implications for the incomes of smallholder farmers. In the immediate term,
lockdown conditions are interrupting planting, harvesting, transport and sale activities – for
example, shortages of migrant labor, equipment and transport logistics have disrupted the winter
crop harvest in India; cashew farmers in Benin are struggling to find buyers and prices have fallen
by 30%. In addition to the knock-on consequences of these immediate disruptions, in the longer
term we anticipate shifts in consumer demand, reduced demand and pricing for certain crops,
closure of small or medium-sized enterprises (SMEs) within agricultural supply chains and market
systems, devaluation-linked restrictions and changes to pricing of imported inputs, and labor
imbalances/shortages. Further, Bain & Company suggest that a number of existing structural
challenges within food and agricultural systems will be exacerbated by the current crisis. Without
intervention, these challenges can severely impact smallholder farmers’ incomes in the short and
long term.

The crisis is likely to create disproportionate economic, health, and nutritional challenges for
women within rural households. Our experience suggests underlying gender inequalities in access
to productive resources will deepen, leaving women economically vulnerable in the short term
and challenging their ability to recover quickly. Complex, and often unequal, intra-household
dynamics will have significant and negative impacts on the nutrition and health of women, girls,
boys, and other vulnerable populations. Without a deliberate response, this crisis puts many of
the gains that our women clients have made towards addressing these inequalities at risk.

The COVID-19-related pressures on the lives and livelihoods of smallholder producers fall on the
heels of other crises – including climate change and pest infestations. Smallholders around the
globe have been grappling with the impacts of rising temperatures, changes in rainfall patterns,
and extreme weather events on their production, incomes, and food security. According to the
WHO, in 2019 34 million people faced severe food insecurity as a result of climate change.
Smallholders in many parts of the world, particularly East Africa, have already been grappling
with devastating pest infestations in recent years – including the ongoing locust infestation that is
estimated to cause an $8.5 billion loss in agricultural output in East Africa in 2020, with
devastating economic and food security implications for the region.7

If smallholder farmers’ participation in agriculture is affected, there will be implications to

broader national and global food supply. In many parts of the developing world women and men
farming on less than 2 hectares of land form the backbone of national and global food systems.

7
https://blogs.worldbank.org/voices/locust-plague-fighting-crisis-within-crisis

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Globally, such producers contribute between 30% to 34% of global food supply.8 If smallholders’
ability to contribute toward the supply of food is negatively impacted, this is likely to impact the
global supply of food. In countries that rely heavily on the import of food, this risk is
compounded by the potential of food imports being restricted or becoming more expensive due to
currency devaluation.

In many parts of the developing world, experts expect that the full health consequences of
COVID-19 are yet to come, and it may not follow the same model as developed countries. At the
end of April 2020, a little over three million people have been infected by COVID-19, and over
200,000 have died, but infection rates in many countries where we operate – particularly in Africa
– have been lower and slower.9 Experts suggest that the full brunt of this pandemic on health in
these countries may be coming in the future and is likely to be even more devastating given their
weaker health systems.10 While rural areas have lower population density, and potentially lower
risk of contagion, rural areas also tend to have weaker health infrastructure systems and longer
travel distances to health clinics and hospitals.

It is more critical than ever to support our clients with their response and recovery from this
crisis, so they might continue on their path to economic prosperity and resilience. This crisis –
which comes on the heels of other crises – will put pressures on the health, nutrition, and
incomes of our clients both in the short term, and in the longer term as the crisis unfolds and
deepens. This crisis is likely to exacerbate inequalities within agricultural systems, putting hard
won progress in supporting inclusion of women and the poor into more profitable agricultural
opportunities at risk. In addition to creating significant short-term hardship for our smallholder
farmer clients, the expected impacts create a risk of smallholder farmers being unable to re-enter
the more profitable agricultural opportunities, putting them on a downward income-investment-
production trajectory, a situation where diminished earnings will limit investment potential and
perpetuate and exacerbate low incomes into the future. Negative impacts to smallholder farmers
are likely to have broader implications for rural economies and national food supply.

8
Ricciardi, Vincent, How much of the world's food do smallholders produce?
9
https://coronavirus.jhu.edu/map.html

10
https://www.theatlantic.com/ideas/archive/2020/04/why-covid-might-hit-african-nations-
hardest/609760/

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Ground-level insights on the impact of COVID-19 on our smallholder
farmer clients today

In mid-April 2020, TechnoServe conducted a rapid survey with 22 of our agricultural programs in
13 countries to understand the situation on the ground and the challenges facing our smallholder
farmer clients.

The insights from the ground-level survey resonate with the macro-level challenges described in
the previous sections, and in many cases offer concrete, tangible examples of the challenges that
have been described at a high level in the previous section.

We would like to share a few caveats on the insights shared below:

– We expect the economic impact of this crisis on smallholder farmers and rural
economies to evolve over time as the health and economic effects cascade through
supply chains and various levels of market systems.

– Second, we recognize that there will be significant variation by geography, value

chain, stage of production, and household socio-economic profile, and that the
solutions and responses will need to be tailored and contextualized.

COVID-19 restrictions are directly impacting nearly all of our smallholder farmer clients. In only
1 out of 22 programs farmers are operating in contexts without any restrictions. Fifty-five percent
of projects reported that farmers are living under full lockdown conditions, and in 42% there are
some restrictions on movement and gatherings.

Access to reliable, trusted health information remains a challenge for farmers in 1 of 4 of our
projects. While many project teams reported that farmers have access to accurate, fact-based
information on COVID-19, primarily from government sources, 25% of projects said this is not
the case. For farmers that do receive information, it is primarily from government sources,
transmitted over radio and open channel television. Even in cases where farmers do receive
information from official channels, there is some evidence of farmers being inundated with false
and misleading information, or information that leads to stigma. A coffee program manager in
Honduras reported: “many producers have access to the internet, so they also have access to false
information, which confuses [them] and causes fear. There have been reports in two communities
where we work where individuals have suffered violence and discrimination for presenting
symptoms.”

Overwhelmingly, farmers are experiencing reductions to cash income due to interruptions to

income-generating activities. In addition to the opportunity that we support farmers to leverage,
our smallholder farmer clients, in almost all cases, also generate daily cash income through other
farming and non-farming activities – e.g. selling their labor, dairy farming, sale of other fruits and
vegetables, or other home-made items – which in many cases is no longer possible, or is
generating less income. For example, while coffee farmers in our program in Zimbabwe have not
experienced any price reductions for their coffee, our coffee program manager there reported that
“farmers cannot sell some of the cash crops such as bananas which gives them daily income.” A
program manager in Honduras reported, that farmers, women in particular, are experiencing a

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reduction in income because they cannot engage in other activities such as sale of bread,
vegetables, and other foods produced at home. In addition to supporting farmers pay for
household requirements (including food, health care, education, etc.), these additional cash
streams are often critical in enabling investment in longer-term, potentially more profitable,
crops like cashew, coffee, and food crops.

For many farmers, food security is already a concern and is likely to intensify as the crisis
deepens. Typically, smallholder farmers are well diversified and make planting and production
decisions to maintain adequate food reserves. However, 12 of 22 programs reported concerns
around food security, and highlighted that this challenge is likely to become worse over time.
Presently, physical access to food is less of a concern, rather, reduction in cash income from
agriculture and other income generating activities (highlighted above) may drive farmers to
deplete their food reserves faster than usual, or sell food reserves in order to generate cash. Our
coffee program manager in Zimbabwe reported, “farmers still have some food from reserves, but if
the lockdown is extended, they will be food insecure.” In Honduras, a program manager
supporting bean productions said, “producers cultivate in order to maintain food reserves, but
there is a risk that they may choose to sell some of their reserves to generate cash income.”
Further in some cases, for example, as reported by our programs in Uganda and India, the
migration of family members from urban areas back to rural areas is causing pressure on food
resources in rural areas. In the longer term, reductions in output and productivity can also
compound food security challenges.

Even though in most countries agricultural activities fall under essential services, farmers are
facing disruptions to agricultural activities today that may lead to lower output, lower incomes,
and lower investment in the future. As outlined in the graphic below, what farmers need to
succeed in agriculture, and thereby the nature of challenges and disruptions farmers may face,
varies depending on the stage of production farmers are in. For farmers that are in the midst of
harvesting, in addition to lower prices and limited access to market options described later,
farmers are struggling to access hired or group labor to harvest. Farmers that are preparing to
plant have reported challenges accessing labor, as well as, in some cases, key inputs and
mechanization services due to the lockdown. Our program in Zimbabwe supporting farmers to
supply mange tout peas for the export market said, “farmers are not able to access inputs like
fertilizers, seed, fuel, and chemicals to be able to plant mange tout peas, and they may not be able
to plant after end of June as mange tout peas are a winter crop.” In Zimbabwe, farmers are coping
by choosing to plant lower value crops for which they can access seeds locally, or will plant late
and experience lower yields. A program manager for a vegetable project in Ethiopia said:
“limitations and restrictions in movement make it difficult for farmers to work efficiently. These
conditions will have a significant negative impact on their income.” We can expect these
immediate disruptions to have a negative impact on farmers’ incomes in the medium term, which
can reduce farmers’ ability to invest in the next crop cycle. Our program in Nicaragua said, “lower
profits due to depressed prices will generate little capacity to pay attention to the crop for the
next cycle, thus generating a climate of low investment, which will be aggravated by a lack of
financing.”

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Most farmers that are in the process of marketing and selling their agricultural output are
experiencing significantly lower prices. In our survey, for projects where farmers are in the
process of harvesting, selling or marketing their production (8 of 22 projects surveyed), in 75% of
cases farmers reported experiencing lower prices. Farmers in five of eight projects - including
cashew farmers in Benin, coffee farmers in Peru, and dairy farmers in Honduras - reported very
large price drops greater than 30%. In some cases, lower prices are caused by limited buying
activity due to physical restrictions imposed by the lockdown (coffee, cashew), and exploitative
practices by middlemen. Our mango program in Kenya reported that “with restricted movement
of people, farmers aren’t able to access reliable markets for their produce and are being exploited
by those that buy their produce at lower prices due to fewer options.” In other cases, lower prices
are due to lower end-customer demand (e.g., dairy and cheese). Our dairy program in Nicaragua
reported, “with excess products in the cheese cellars, and exports to our main markets of El
Salvador and USA closed, cheese cellars in Rio Blanco and other dairy areas of the country are
filled up to the maximum. National prices for a liter of milk have gone from C$10 to C$6 in the
last 2 weeks.” We expect there to be continued volatility in pricing as the crisis continues. We
have also seen a few cases – e.g., the case of sugar beans in Zimbabwe, or maize in Karnataka,
India in March – where farmers have seen large upward spikes in price. In addition to causing
losses, price volatility in the short term can cause panic and speculative behavior.

Finally, farmers are facing a tremendous amount of uncertainty, and potential risk associated with
future changes to pricing and demand. The crisis is currently affecting farmers’ immediate
activities, but agriculture is a long-term endeavor and decisions that farmers make today
materialize many months in the future. If there are big shifts in demand and pricing between now
and the time of sale, agricultural opportunities and planting and investment decisions that made
sense in times of economic stability may no longer be sensible. Our program staff in Nicaragua
said that the biggest challenge facing farmers is: “the uncertainty of the export market, and
reductions in export demand which will drive down the price.” Our coffee program staff in Peru
said, “there is uncertainty and a lack of clear guidance that help the coffee grower to face this
situation and access the market.”

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What does this mean for TechnoServe’s priorities?

TechnoServe is an economic development organization. We support our clients to earn higher

incomes by linking them to capital, markets, and information. In times of economic stability,
TechnoServe’s agricultural programs are designed to support women and men that work in
agriculture grow their incomes and profits. Our programs typically pursue this objective by
supporting farmers access high margin agricultural opportunities. Among other interventions, our
program teams support this objective by helping smallholder farmers view farming as a business,
to identify demand-side opportunities and link smallholder producers to more profitable buyers
and markets. We train farmers in improved agronomic and processing practices to meet the
requirements of buyers, and support access to better inputs, services, and financing.

Our model of support is underpinned by the assumption that by supporting women and men
within the household to grow their incomes, we can support the overall wellbeing of the
household and build resilience. Under normal economic conditions, higher incomes and increased
buying power enable farmers to invest in improved health, nutrition, and education for
themselves and their families. Increased livelihoods enable the individuals that make up the
household to re-invest in income generating activities and productive assets. In stable economic
times, farmers can maintain well diversified and nutritious diets through the combination of their
own production and cash income, and can maintain their health and physical wellbeing.

As a result, to achieve our objective of smallholder wellbeing and resilience, in normal economic
conditions we target our efforts on supporting farmers grow their incomes. We do this not
because we feel this is the most important goal, but because rising incomes enable farmers to
pursue these other objectives in a sustainable manner. We are deliberate about expanding
economic opportunities for women within the household, as we understand the disparate cultural
expectations of women and men, and the resulting complexities of intra-household decision
making. We ensure our advice never threatens food security, nutrition or health outcomes, and is
always designed to support and enable these objectives.

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However, In the current COVID-19 crisis, assumptions that hold during stable economic
conditions can no longer be relied upon, and our primary focus on incomes may fall short of
driving overall wellbeing and resilience. First and foremost, the pandemic is threatening farmers’
ability to safeguard their health and the health of their families and unexpected reductions in
income are creating economic barriers to food security. Farmers around the globe face the risk of
catastrophic economic losses in the immediate term if they cannot sell their current harvest or
make the most optimal planting decisions for the upcoming season. Further, this crisis will likely
reveal and deepen underlying inequalities and structural weaknesses in agricultural and food
systems, and it is likely that women and poorer populations will face a harder challenge in
responding and recovering.

In this context, to drive the wellbeing and resilience of the women and men we support through
our agricultural program, TechnoServe must re-articulate and broaden program priorities to
support – in tandem – the safeguarding of health, securing of food and nutrition, and sustaining of
incomes. We are not suggesting TechnoServe embarks on programs focused on supporting health,
food production, or nutrition; rather we are suggesting that, in the short term, existing and new
programs focused on high margin agriculture will need to incorporate actions aimed at supporting
smallholder farmers mitigate for shocks to health, food security and nutrition, alongside our
traditional focus on incomes.

This crisis highlights the need for us to further sharpen our gender lens; to carefully craft actions
and solutions within each priority area to meet the different challenges of women and men, and
support women to recover at the same pace as men.

Finally, while our focus on resilience is not new, this crisis highlights the need for us to embolden
our focus on supporting resilience to this and future crises, most notably climate change.

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What should TechnoServe do?

Deloitte has demarcated the crisis response into three phases: “Respond”, “Recover” and
“Thrive”.11 For our purposes, we are focusing our response on two phases: Respond and Recover.

Deloitte describes the “Respond” phase as the phase where governments are dealing with an
immediate crisis and taking actions to slow the spread of the virus. It is marked by events such as
business closure, and restriction on movement. Most of the countries in which we operate are in
this phase as of April 29, 2020, even though the health crisis is yet to fully take shape.

The “Recover” phase is the phase where the immediate danger of the health crisis eases, and the
focus of governments shifts to quickening the pace of economic recovery.

It is unclear how long these two phases will last, and it is also unclear if these phases will be
consecutive or even distinct. However, the two phases will likely require different actions from
TechnoServe, so it is worthwhile to maintain this distinction in our labeling.

In the “Respond” phase our role will be more focused on supporting farmers to mitigate losses and
risks in all three priority areas: health, food, and incomes. During this phase we may need to take
a more active role than we have historically, and will likely need to adopt remote / digital
platforms to carry out these efforts, given travel and movement restrictions.

In the “Respond” phase TechnoServe can support through the following categories of actions:

Health
• Regularly provide accurate, fact-based information and guidance to smallholder farmers
(SHFs) on COVID-19
• Encourage and support healthy behaviors (e.g., hand washing, social distancing,
quarantining) amongst our clients and their families to slow contagion in rural areas and
flatten the curve

Food & nutrition

• Support immediate actions to maintain or slow depletion of food reserves
• Support immediate actions to support consumption of nutritious food at the household
level

Incomes
• Support farmers to overcome disruptions to agricultural activities (e.g., planting, input
application, weeding, harvesting, storage, transport, sale)
• Facilitate emergency financial support for SHF clients
• If farmers are able to engage in agricultural and other income generating activities, advise
on how to safely do so

11
https://www2.deloitte.com/content/dam/Deloitte/th/Documents/about-deloitte/th-about-economic-
outlook-2020-covid-19-impact.pdf

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In the “Recover” phase, TechnoServe will return to its central goal of supporting incomes, and our
actions will be focused on helping farmers to rebuild their economic lives and re-engage in high
margin agricultural activities, but with a newfound recognition of macro- and micro-level
challenges resulting from COVID-19 intact. We will also likely return to a more facilitative role
and the focus on resilience will be more pronounced in the “Recover” phase. In both phases we
will take a sharp gender focus.

In the “Recover” phase TechnoServe can support through the following types of actions:

Health
• No direct role, but via our support on incomes we will support economic access to health

Food & nutrition

• Advise on allocation of land/labor/inputs in a manner that secures access to food,
including nutritious foods (land allocation less relevant for tree crops)
• Educate members of the household on good nutrition
• Via our support on incomes we will support economic access to food

Incomes
• Support farmers to continue engaging in profitable agricultural opportunities, or re-enter
profitable agricultural activities, following micro- and macro-level shocks, and
uncertainty (e.g., pressure test and confirm that the farmer business case for the high
margin agriculture opportunity still holds – i.e., offtake arrangements, demand, price,
production costs, etc., support farmers that have suffered losses or depleted their savings
to access cash or financing to re-enter the agricultural opportunity, support farmers to
access mechanisms to mitigate for future uncertainty and risks)
• Build smallholder resilience to future shocks, including climate change

Across both phases we recommend that TechnoServe programs regularly gather data directly
from smallholder farmers to understand how COVID-19 is impacting them in terms of health,
food and nutrition, and incomes. These real-time farmer-level insights will enable us to adapt our
support as required, and better serve our smallholder farmer clients.

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How can TechnoServe support SHF participating in our agricultural programs?

12

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Icons from flaticon.com

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What’s next?

As a next step we will work to provide further guidance on actions that can be taken within each
new initiative, with practical guidance and best practices on how to create a sub-set of activities
that are likely to be relevant across our high margin agricultural programs.

COVID-19 is new and evolving, and everyone around the world is continuously learning to
adjust. As we move forward through the coming weeks and months, it will be more important
than ever to work together, share lessons learned, and remain optimistic about the impact we can
continue to achieve for women and men in the developing world.

For more information, please reach out to: Nupur Parikh, Director, Strategic Initiatives at
nparikh@tns.org.

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