Small-scale farmers are forced to deal with intermediaries whose prices often fail to cover the costs of production. As a result, farmers often live hand-to-mouth, unable to meet basic needs. Short-term financial instability prevents long-term investments in education, housing, and other long-term needs.
Farmers are not trapped in poverty because they are unable to produce profitable crops.
If given loans at more competitive interest rates and the technical and social capital to access North American and European organic produce markets, they are able to build profitable farms and good lives.
Vida Harvest works closely with farmers and buyers. We get commitments from buyers and sign contracts with farmers in many cases before they even put seed in the ground, giving farm families unprecedented stability. We work with farmers throughout the growing season, giving technical and organic traceability support.
Organic production eliminates use of chemicals that poison air, earth and water. Vida Harvest curretly has planted 3,900 certified organic acres and anticipates 6,400 acres planted by 2018.
Because organic farming is more labor intensive, it has the potential to create more jobs than conventional farming. This year, Vida Harvest created 900 farm jobs, and expects that to grow to 8,500 by 2018.
Once crops are harvested, farmers deliver to our processing plants, and in most cases get paid at that time for their crop. As a result of improved prices and stability, Vida Harvest farmers have been able to make short and long-term investments in their farms, families, and communities.
Integrating small-scale farmers into value added chains is another way of ensuring they have more stability and get a better price for their product. To that end, Vida Harvest runs a sesame processing plant and a cotton gin, ensuring our farmers always have access to quality and timely crop processing.
This year, our sesame processing plant put 50 people to work for 8 months, and we hope to increase that to 75 full-time workers next year. We clean and hull organic farm stock sesame at a rate of more than 44,000 lbs a week. Since taking possession of the sesame processing plant in 2014, we've made major investments to improve the plant and in June it passed FDA inspection. With the farmers in control of the cleaning and hulling of the sesame, they are ensured that a quality product gets to their buyers in a timely fashion.
We've also been running Nicaragua's only functioning cotton gin since 2008, putting 25 people to work in cleaning and ginning organic cotton for 4 months out of the year.
All jobs created comply with fair trade standards, and workers receive a benefit package in accordance with Nicaraguan labor law.
We know that small-scale farmers can produce profitable crops, but commercial loan rates in Nicaragua are often between 15 and 36%, effectively prohibiting capital investment in small-scale farming operations.
That's why we've created the Vida Fund, a shared risk investment fund that gives small scale farmers access to loans at more competitive interest rates, as well as the technical and social capital to access North American and European organic produce markets.
Social lenders back these small farmers by investing in the Vida Fund. The Vida Fund is then able to finance post harvest crop collection, processing and in some cases, planting and harvesting. With accessible financing to back them, our farmers are able to build profitable farms and good lives.