Family Farming Knowledge Platform

The hidden middle: the quiet revolution in the midstream of agrifood value chains in developing countries

The food security debate has focused largely on the farm sector and on trade. Relatively
neglected or ‘hidden’ from mainstream debate are the middle segments (processing, logistics, whole-
sale) of agrifood value chains in developing countries—and yet this ‘midstream’ forms 30–40 per cent
of the value added and costs in food value chains. The productivity of the midstream is as important
as farm yields for food security in poor countries. The article shows that over the past several decades
the middle segments have transformed quickly and surprisingly—with a huge volume expansion, a
proliferation of small and medium enterprises (SMEs), but also concentrating and multinationalizing
(in some places and products), with technology change characterized by capital-led intensication, and
with the incipient emergence of branding and labelling and packaging, of new organizational arrange-
ments in procurement and marketing interfaces with farmers and retailers, and of private standards
and contracts. Economic policies of market and foreign direct investment (FDI) liberalization, com-
mercial and business climate regulations, hard and soft infrastructure investment, and food safety laws,
have paved the path to the expansion and shaped the transformation of the important midstream seg-
ment of food value chains.
Title of publication: Oxford Review of Economic Policy
Volume: 31
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Page range: 45-63
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Author: Thomas Reardon
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Organization: The Oxford Review of Economic Policy Ltd
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Year: 2015
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Type: Article
Content language: English
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