Farmer based organizations in Ghana

In recent years, there has been renewed interest among both public and private organizations to establish farmer based organizations (FBOs) in Ghana. This interest is based on the premise that FBOs give farmers bar-gaining power in the market place, enable cost-effective delivery of extension services, and empower FBO members to influence policies that affect their livelihoods. This paper seeks to examine whether FBOs have achieved these objectives and draws from two main data sources: a 2010 IFPRI Survey of 501 FBOs and 24 FBO case studies. We find that the motivation for forming an FBO and the nature of the collective activity are the best predictors of FBO effectiveness. In general, FBOs involved in production tend to be more concerned with capturing resources like training and financial aid than with generating profits. Such FBOs rarely become economically viable entities. FBOs engaged in processing and marketing activities tend to operate more like a business and are driven by revenue generation; they also are more successful in attracting loans. Despite the recent dramatic rise in the number of FBOs, the evidence suggests that it is unreasonable to expect that many of them will evolve to sustainably undertake profit-generating activities.