Root Capital, Central America

Improving smallholder farmer livelihoods by strengthening cooperatives in the coffee, cocoa and honey sectors.

Agricultural enterprises, with proper support and access to finance, can improve the lives of millions of vulnerable rural families. In Central America and Mexico, agricultural cooperatives play a critical role in linking farmers to global markets, providing them with agronomic trainings and ensuring stable incomes. However, limited access to critical assets, as well as under-developed financial and accounting expertise, makes small farmers vulnerable to external threats such as volatile commodity markets and climate change.

In partnership with the Trafigura Foundation, Root Capital intervenes by extending essential financial and agronomic training to 12 agricultural cooperatives in Guatemala, Honduras, Mexico and Nicaragua, with the aim of boosting their resilience and credit-readiness. The programme targets small, farmer-led cooperatives in the coffee, honey and cocoa sectors.

Trainings, which help businesses develop stronger internal management capabilities, ultimately improve the livelihoods of 3,310 producers and their families. In 2019, for example, Mexican beekeeping cooperative Tagane significantly improved its pricing and profitability capabilities by learning how to navigate Mexico’s online tax portal. This enabled them to pay income tax directly, avoiding substantial accountancy fees, and boosting their profit margins.

Another cooperative, Nicaraguan coffee collective Flor de Dalia, rolled out a digital business intelligence system to make data-driven harvest forecasts, enabling it to secure and fulfil large international orders. While the new digital tool, developed by Root Capital, is facilitating more efficient agronomic and financial tracking and projection, it has also created new job opportunities, with a young person from the community employed to manage it.
Deeper levels of information revealed by the data also mean that the cooperative can offer larger and smarter lines of credit to its producers. In this way, Flor de Dalia’s members are equipped with the resources they need to invest in their farms, their families and their futures.

(Photo Credit: © Sean Hawkey)

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Key Figures

12

with increased resilience to market volatility and climate change

3,310

smallholder farmers generating an income in 2019

7

agricultural cooperatives with increased financial management capabilities in 2019

12 with increased resilience to market volatility and climate change
3,310 smallholder farmers generating an income in 2019
7 agricultural cooperatives with increased financial management capabilities in 2019

Root Capital - 20 Years of Impact

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