Family agriculture makes a significant contribution towards eradicating hunger and poverty, improving food security, nutrition and livelihoods, managing natural resources, protecting the environment and ensuring sustainable development, especially in rural areas. For these reasons, Alterfin is also committed to financing sustainable family agriculture.
Over two billion of the poorest people on the planet depend on agriculture as a means of subsistence. However, as long as the terms of trade in the small-scale agriculture sector are unfavourable to them, smallholders will remain the poorest. Supporting family agriculture is one way of stimulating local economies and fighting extreme poverty.
Alterfin finances 53 organisations active in sustainable agriculture. Together they represent over 105,000 smallholders and 420,000 hectares of land farmed sustainably. Collectively, their sales amounted to EUR 430 million in 2015, 90% of which were certified (in line with fair trade and/or organic farming or by means of another type of certification such as UTZ or the Rainforest Alliance).
Fair trade benefits
Alterfin finances mainly farmers’ organisations operating in the fair-trade circuit. Thanks to the loans provided by Alterfin, these organisations can prefinance producers’ harvests, giving them better access to the market. The producers’ organisations often also take care of processing and marketing the products harvested. This means that the volumes traded are bigger and a balance of power with the buyers is restored, so that producers can receive a higher price for their harvest.
In addition to the minimum price, fair trade buyers also agree to pay a premium. The total amount granted to our ‘fair trade’ partners as a fair trade
premium amounted to EUR 16.8 million in 2015. The producers decide democratically how to use the premiums within their organisation.
In 2015, the premiums were mainly distributed among producers (45%), but a large proportion was also used to improve infrastructures (31%), enhance the quality of the products and ensure certification (13%) or for projects linked to health or education (6%).
76% of our partners in sustainable agriculture offer their members additional services, mainly technical assistance to improve the productivity of the organisation. There are also various education and health-care services, projects for women and other community projects.
TESTIMONIAL: Pedro and his melipona bees
Pedro Romero is a Hondurian coffee producer reached by Alterfin. He is member of the cooperative Cocafcal that buys his coffee to sell it on the fair-trade market. “Thanks to the cooperative, I sell my coffee at a better price, because the prices are negotiated for the entire production of 879 producers who are Cocafcal members. What is more, a minimum price is set. We also receive an annual collective bonus. Finally, the cooperative teaches me how to take care of my plantation better and operate it in a way that is kinder to nature."
Pedro now wants to expand his honey production so that he can sell it to the cooperative which has diversified to cover numerous products, including dried fruits, passion fruit, lemongrass, tomatoes and honey. “They are bees called ‘melipona’, a type of stingless bee that is only found in tropical regions” he explains. “Selling honey helps me out at the end of the month.”
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