Cash crops enhance food security
Crops sold on markets ('cash crops') are an integral part of strategies to improve food security at farm household level in developing countries. By selling their surplus production, agricultural households generate income that improves access to food. Research by LEI Wageningen UR, commissioned by the Dutch Ministry of Economic Affairs, shows how farmers choose to cultivate cash crops or food crops for subsistence. The study argues that cash crops play a key role in the transition towards sustainable intensification of agriculture.
Cash crops like cocoa and coffee, but also vegetables and maize, offer income and employment opportunities to the rural economy. In addition, farmers generate capital for management improvements and innovation, and cash crops accelerate the build-up of institutions that enable further commercialisation. As any farming activity, cash crop agriculture requires the management of various types of risk such as soil degradation and price variability. Examples show that farmers employ several adaptive and risk reducing strategies, for instance by diversifying cropping patterns to cope with risks of harvest failures, price slums or loss of market access, and by establishing cooperatives or using agricultural commodity exchanges.
In Africa food demand will be increasing over the next decades. Sustainable intensification – aiming to reconcile production and protect the environment – is a practical approach for African farmers to cope with food insecurity. Examples are micro-dosing of fertilizers, intercropping, genetic crop improvements, extension and establishing farmers' marketing associations. Cash crops are an essential part of sustainable intensification as income generated with cash crops provides farm households with means to save and invest in a more productive farm, and cash crops may have a catalytic effect on agricultural innovations as they add value and productivity in rural areas.