Cash Crops
Many poor families that survive on the produce of their farms still need additional income. Profits from the sale of animals or crops are used to buy household items, food that is not locally available, school tuition and supplies, clothing, and other items such as health care.

One of the major ways Food for the Hungry (FH) works to help farmers generate more income is to introduce new varieties of crops that are more productive and often more pest resistant. Cash crops include but are not limited to onions, spices, fruit, and high value grain crops. FH generally works with the country’s Agricultural Extension (AE) service department to determine which varieties have potential. Working closely with AE reduces duplication of efforts and streamlines the process. The local farmers are the ultimate decision makers on whether a variety is good or not by field testing these potential new varieties. If the variety is approved, farmers can then become involved in the seed multiplication process so that it will become readily available in the area.

Improved Animal Husbandry
Most farmers in developing countries not only grow crops but they also raise animals to support their families. These animals are very important to household food security because in many cases they serve as a “bank account” for the family. A goat or sheep is sold to raise tuition money to send a child to school or in an emergency to pay for medical expenses. Animals need a number of “inputs” to make them productive and profitable. A ready supply of water and food are two key essentials but good veterinary service and connection to markets for the sale of the animal(s) are also necessary. A good supply of fodder and water that is close by are not always easy to come by in the areas Food for the Hungry works. If animals need to travel long distances to obtain water, they remain skinny and less valuable. Helping farmers to produce and manage sustainable supplies of fodder and water are very important challenges.

Like crops, more productive breeds are sometimes available. For example, a breed of cow that can produce more milk and is resistance to local diseases can greatly improve a family’s income. Food for the Hungry works with the Agricultural Extension service and local farmers to determine which breeds have the most potential. Subsequently, breeding programs are then used to upgrade the local stock.

Market System Development
The introduction of a new cash crop that is more productive and of better quality is a great accomplishment but if the farmers are not able to sell them it will not be of much use to them. Therefore, the development and improvement of the market system the farmer uses to sell his or her products is an absolute necessity. One of the terms used to describe a market system is “value chain”. The value chain begins with the purchase of the seed and other inputs needed to grow a crop. Other important links in the chain include proper agricultural extension, crop production, proper storage of the harvested crop, proceeding all the way through to the sale of the crop. A truly successful cash crop will be associated with an efficient value chain. Many of the places Food for the Hungry works are very rural and isolated, creating an obvious challenge. Connecting the farmer to the interested buyers requires everything from pubic relations (informing buyers of the availability of the crop) to the development of roads leading to local markets.

Savings and Credit
Agricultural production is the backbone of most countries where Food for the Hungry (FH) works, but it is important that other mechanisms are set into place. Families need access to savings, credit systems and income that is not exclusively farm-related. Credit in developed or developing countries is essential for economic development, however credit opportunities can be very limited to the poor in rural areas where we work. Institutions many not be available and if they are, they generally do not lend to the poor.

To counter this challenge, FH works with local communities to form savings and credit groups. Generally a group is formed of about 20 individuals who contribute weekly to the group’s “bank”. Usually the members know one another and therefore can apply “peer group” pressure to others when necessary. The money becomes available to individuals in the group for interest-bearing loans. Money to borrow becomes available to members who usually do not have access to formal lending institutions. Generally the payback rate is very high on loans. The ability to borrow for business purposes at reasonable rates of interest contributes greatly to family and community economic development.

Non-farm income generation
Starting small businesses that supply useful, value-added products is a must for rural economic development. To be successful, these products must be tied to appropriate value chains that connect the rurally-produced products to urban markets.