Viewpoint: Finance Needs of the Agricultural Midstream

• Published in: Food policy 2023-11, Vol.121, p.102530, Article 102530
• Main Authors: Ambler, Kate, de Brauw, Alan, Herskowitz, Sylvan, Pulido, Cristhian
• Format: Article
• Language: English
• Subjects: finance; food policy; supply chain
• ISSN: 0306-9192; 0306-9192
• DOI: 10.1016/j.foodpol.2023.102530

•The agricultural midstream is relatively understudied.•The vast majority of firms in the midstream are MSMEs in potential need of finance•Needs are heterogeneous by agricultural conditions, seasonality, and policy environment Recent literature suggests that agricultural value chains are changing rapidly and places an increasing focus on the importance of actors and activities taking place in the “midstream” of these value chains, after production and prior to final sale. This article discusses the financial needs of midstream actors in agricultural value chains, emphasizing differences across midstream activities and highlighting how value chain characteristics can influence both financial needs and potential remedies. The paper concludes with a brief discussion of the prospects of digital financial services and policy levers for government actors in this space. This paper is an output of a project funded by the Bill and Melinda Gates Foundation. We are deeply appreciative that Marc Bellemare, Lauren Bergquist, Alfredo Burlando, Lorenzo Casaburi, Marjolaine Chaintreau, Anne Craib, Shaun Ferris, Seth Garz, Xavier Gine, Jikun Huang, Thomas Jayne, Mayank Kaushik, Saweda Liverpool-Tasie, Panos Loukos, Mywish Maredia, Maria May, Craig McIntosh, Hamilton McNutt, Hope Michelson, Bart Minten, Betty Muriithi, Sudha Narayanan, Indalecio Perez, Tom Reardon, Katherine Rickard, Brian Sserunjogi, Meredith Startz, Jo Swinnen, Ezgi Ucaner-Flor, and Bjorn van Campenhout took time to share their thoughts on these topics and contributed to the formulation of the ideas presented in this paper. We also thank the editor, Chris Barrett, and three anonymous referees who made suggestions that greatly improved this paper. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.