Purchase For Progress in El Salvador
What is Purchase For Progress?
Purchase For Progress (P4P) an initiative of the United Nations World Food Programme (WFP), that arose as the WFP desired to purchase food in a way that was part of the “solution to hunger.” It enables low-income farmers to supply food to the WFP's operations. Eventually the transaction can be regulated by a forward contract, with the farmer agreeing in selling in the future (up to three years) a certain amount of output at a fixed price. Essentially, the P4P program aims to create a wide and sophisticate market for commodities in developing countries.
In El Salvador, low surplus to sell in markets, high marketing costs and low prices at the farm gate are the main causes for low income of smallholders. P4P works with partners to strengthen the institutional capacities of farmers’ organizations to effectively aggregate and market members’ commodities.
The organisations participate in a development capacity programme in areas including management, business & administration, quality control and contractual procedures. Smallholders’ processing and storage infrastructure and their post-harvest handling practices are also being improved.
El Salvador’s Agricultural Development Bank (ADB) provides credit to farmers to purchase inputs. However, the terms of the credits are not sufficient to bridge the gap farmers experience between planting and harvest.
WFP is working with ADB to develop more appropriate credit products for smallholders that are better adapted to the agricultural production cycle. El Salvador’s rigid market structure limits market access for smallholders and farmers’ organizations. Individual farmers as well as many organizations sell almost exclusively to middlemen, who collect and transport the grain and control market access at the primary level. Farmers’ organizations have developed some capacity to produce and market quality commodities.
So far, WFP has been their main market outlet by purchasing for its food assistance programmes. P4P promotes links between farmer organizations and other institutional markets to ensure sustainable markets for the farmers.
P4P focuses on fully integrating female farmers into all activities. Knowledge transfer activities are designed to accommodate the specific needs of women and men, young and old. Regarding farmers' organizations management and administration, gender audits were carried out to inform a plan of interventions to promote female participation in decision making processes and administration. Special attention is paid to ensure that women are able to sell their crops to WFP and other formal buyers.