The previous article explained that agricultural marketing is the link between production and the consumption of agricultural products. This article focuses on the role of marketing in more detail and its challenges.

The Place of the Consumer in Agricultural Marketing

In a market economy, much emphasis is placed on the consumer. This philosophy of marketing is known as the “marketing concept.” The consumer’s satisfaction is said to be the ultimate goal of the system.

If many consumers decide not to shop at Supermarket A or eat at Restaurant B, those institutions will wither away. If a significant number of consumers decide they prefer beef to chicken for most of their meals, cattle producers will prosper for a time, while poultry farms may not.

No agricultural product or agribusiness has a guaranteed place in the market. Each must continue to earn its position based on the tastes and preferences of consumers.

In view of the strategic position of consumers in marketing, millions of naira are spent annually on advertisements and sales promotions to influence consumer demand.

These activities are aimed at persuading consumers to attribute certain desirable characteristics to one brand of product over a competing brand, even when the products are objectively identical. This fact explains why firms, including farmers, strive to control the marketing system.

Most consumers are found to be passive in their consumption. In the case of industrial products, some firms are highly successful in influencing consumer demand for their specific products, for example, in the soft drink industry.

However, for agricultural products, due to their homogenous nature, the influence of sellers on consumer choice is insignificant. In these cases, a successful marketing program must be consumer-oriented and focus on achieving consumer satisfaction. Part of that satisfaction will come from effective packaging, advertising, and merchandising.

Read Also: Agricultural Tillage Practices

The Role of the Farmer in Agricultural Marketing

The farmer plays a pivotal role in agricultural production and marketing, as the first point of contact. Farmers’ activities are usually focused on meeting the immediate needs of family members, with any excess output entering the market as part of the overall economic development and agricultural transformation strategies.

The farmer remains key in agricultural transformation and poverty reduction, contributing to agricultural development strategies by adopting new technologies and ideas for enhanced production.

The income generated from agricultural production has supported the commercialization of agriculture, increasing trade in high-value crops and value-added traditional crops.

Extension services, production planning, and service delivery are among the services rendered by experts to complement and enhance agricultural transformation. These services are available because farmers are willing to adopt them.

Economic Importance of Marketing and Markets

In a free market economy, the price system and competition provide the mechanism for determining the flow of resources into production and the flow of goods and services to consumers. It is within the marketing system that prices, resource allocation, income distribution, and capital formation are determined.

As a result, the structure and performance of the marketing system can significantly impact total commodity production, consumer prices, the adoption of improved production and marketing technologies, and the growth of the entire economy.

The existence of markets allows for specialized production. Since people can exchange what they produce for what they cannot produce through marketing, they are encouraged to focus on specific lines of production, where they can gain more skill and efficiency.

Marketing enables this exchange. The level of specialization in an economy depends on exchange, and the rate at which an exchange economy emerges is tied to the performance of its marketing system.

As the marketing process becomes more complex, additional steps appear between producers and consumers. Agencies or individuals, known as middlemen or marketing intermediaries, emerge to facilitate the process. In the early stages of development, farmers sold directly to consumers.

In rural communities, this practice persists, but it does not support a developed marketing system, which can limit productivity. A good and efficient marketing system accelerates economic development by encouraging specialization, leading to increased output.

Other roles of marketing in economic development include:

1. Generation of foreign exchange earnings;

2. Sustaining a country’s economic growth through the development of an exchange economy;

3. Providing incentives to farmers to adopt improved technologies, leading to increased production;

4. Offering income and livelihoods to marketing agencies or intermediaries;

5. Encouraging specialization and expansion of output.

The Possibilities for Expansion of Agricultural Products

Expanding agricultural production in Nigeria would require overhauling some existing policies that have constrained agricultural output over the years. Similarly, those engaged in agricultural production would require other forms of encouragement. Areas that require further emphasis include:

1. The granting of price and tax incentives to producers.

2. An increase in the number of processing and storage plants to avoid post-harvest losses.

3. Enforcement of the land use decree which was passed and incorporated into the 1999 Constitution with the aim of making land readily available for large-scale agricultural activities. This has the possibility of expanding agricultural production in the country.

4. Making available the results of research from Agricultural Research.

Some Special Features of Agricultural Products

There are certain inherent characteristics of farm products which make special demand on marketing systems and organizations. These are:

1. Bulkiness: Farm products are usually bulky. Their weights and volumes are great in relation to their monetary value, especially when compared with many manufactured goods. As a result, transport and storage costs for such products tend to be high in relation to their value.

2. Perishability: Some crops, such as rice (in the form of paddy), retain their quality for a long time but most farm products are perishable. Fruits and vegetables rapidly become overripe and begin to decay if they are not consumed or kept in special storage. Milk is especially perishable in hot climates and without special treatments, it may keep for only a few hours.

3. Seasonality: The seasonal nature of farm products imposes constraints on the marketing system. At harvest time, there is a heavy demand for marketing facilities such as storage and transportation. At other times of the year, these facilities are hardly used at all. This situation is made worse by the small size of the average production unit.

Over the greater part of Africa and Asia, for instance, the average size of a holding is not more than two hectares; so many farm products start their journey to the markets as the surpluses of many thousand separate farms.

The output of a farmer over and above the food requirements of his family is called the marketable surplus. Generally, in developing countries, the marketable surplus is small, hence there are very many smallholder farmers trying to produce food and fiber for the teeming population, and many middlemen are involved in the distribution system.

Problems Confronting Agricultural Marketing

Over the years, agricultural marketing has not received the type of attention accorded agricultural production. Although there have been attempts in the past for organized marketing institutions like the defunct Marketing Boards to intervene, the farmer has continued to face problems in the marketing of his produce due to a number of factors:

1. The prevalence of poor infrastructural facilities such as poor federal roads, inadequate road networks, and poor telecommunication services between the rural areas where agricultural production takes place and the urban areas which serve as markets for the produce from the rural areas.

2. The problem of inappropriate on-farm storage facilities, thus leading to wastage of farm produce.

3. Irrigation facilities are still very poor despite the existence of River Basin and Rural Development Authorities.

4. The extension service delivery system is still inadequate and especially women extension personnel are very limited to handle gender issues.

5. The land tenure system in some cultural settings, especially in the south, tends to constrain land availability.

6. Over the years, prices of inputs such as herbicides, fertilizers, and pesticides have risen steeply, and these have constrained their adoption and subsequent impact on yield and production levels.

7. Unavailability of credit to farmers, while the cost of borrowing is generally high for operators in the agricultural marketing chain.

8. There is a dearth of information relating to inputs, modern technologies, and market trends.

9. Existing policies are not supportive enough for agricultural marketing transformation, such as the land use act, tariffs on imports of agro-inputs, and machinery.

In this article, the strategic position of the consumer, the pivotal role of the farmer, the economic importance of agricultural marketing, the possibilities of expanding agricultural products, and the challenges facing agricultural marketing have been explored.

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