Resilient to Crises: How the Adaptive Nature of Cooperatives has Aided in Overcoming COVID-19- Related Challenges

October 7, 2020

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Member of the dairy cooperative IAKIB in Rwanda delivers milk at a collection center

This post was written by Alexandra Hamilton of Venture37

Chief of Party, Kari Onyancha shares insights from a global survey

In collaboration with fellow Cooperative Development Program (CDP) implementers NCBA-CLUSA, Global Communities, and Equal Exchange, Land O’Lakes Venture37 (Venture37) conducted a study on the impact of COVID-19 on nearly 90 agricultural cooperatives in 8 countries globally. Data for this study was collected in three intervals (May, June, and July 2020) to assess how the impacts of COVID-19 on cooperative operations changed over time. Kari Onyancha, the Chief of Party for Venture37’s CDP programs in Malawi and Rwanda, has played an integral role in the development, execution, and assessment of the COVID-19 impact study. In this interview, Kari highlights key takeaways from the impact survey and shares her insights on the resilient and adaptive nature of agricultural cooperatives globally.

What data point from the survey was the most startling and what does this mean for the work of cooperatives?

“One of the most startling data points was the percentage of agricultural cooperatives impacted by COVID-19. Ninety-four percent of the cooperatives surveyed reported severe impacts to revenue generation and household income, as well as other stressors. Though this statistic is not surprising given the impact that COVID-19 has had on the global economy, it is important to evaluate this statistic through a local lens. For example, in Rwanda, a country that has over 4,000 cooperatives, cooperatives are an essential component of the national food supply chain. Disruptions to cooperative operations can greatly impact food security, and therefore, it is imperative for NGOs to support cooperatives during these unprecedented times so that the cooperatives may continue their work as pillars of their communities and local and regional food systems.”
Can you share one case example of how COVID-19 cooperative disruptions are impacting a person or business on an individual level?

“In Rwanda, a farmer at KAMA cooperative noted that market disruptions caused by COVID-19 led to significant losses; the price of one kilogram of maize dropped from 300 Rwandan Francs to 200 Rwandan Francs. This drastic change in maize prices reduced his family income and resulted in him defaulting on his bank loan. Stories like this are common and will likely take significant community intervention to fix. For this farmer, it may take years to recover the loss of income and in the short-term, given maize’s status as the household’s staple crop, has a real impact on his household’s food security.”

How has cooperative membership helped individuals become more resilient to shocks, such as the COVID-19 pandemic?  

“Cooperatives have a high level of social capital, meaning there is a high level of trust between the cooperative leaders and its members. This beneficial relationship has enabled cooperatives to become a trusted and reliable source of information dissemination, especially in more rural communities that are difficult to permeate. Through the study, we have learned that over 80% of the cooperatives surveyed relayed vital COVID-19-related information to their members. Cooperatives have also used their high level of social capital to assist members that are struggling financially during the pandemic, with 50% of cooperatives providing small loans to members to cover the costs of inputs and other necessities. Overall, we found that cooperative services during COVID-19, such as information dissemination and financial assistance, have minimized the impact of pandemic-related stressors for cooperative members over the course of the study. For example, nearly 30% of cooperatives reported their members were having difficulty accessing food due to availability and increasing cost. By the third round of data collection, that figured had been reduced to under 10% of the participating cooperatives”

What are the core challenges that cooperatives are dealing with during COVID-19 and how have cooperatives adapted to address these challenges?

“Loss of revenue due to decreased consumer spending was the primary challenge noted in the survey responses. The magnitude of revenue loss has prompted 41% of cooperatives in Rwanda and 50% of cooperatives in Malawi to develop business continuity and emergency plans. Another highly referenced challenge was reduced contact between cooperatives and cooperative members. Cooperatives have addressed communication issues by using phone trees and WhatsApp groups and by implementing other creative strategies to disseminate information. 

How has Land O’Lakes Venture37 helped cooperatives adapt to the challenges stemming from COVID-19?

“We have collaborated with the Information Technology Innovations team at Land O’Lakes Inc. to develop a virtual learning system for CDP cooperatives in Malawi that have limited access to technology and internet connectivity. We have also contracted Picture Impact, a women-owned user-centered design consulting firm, to redesign the CDP training curriculum in collaboration with our Malawian coaches to be virtual (with offline applications) and low literacy friendly. Additionally, we have taken learnings on solutions to animal source foods challenges during COVID-19 from Land O’Lakes Venture37’s Orora Wihaze program and integrated them into the trainings for dairy cooperatives.”

Based on survey results and our analysis, if there were one thing development organizations can do today to help cooperatives during COVID-19, what would it be?

“Cooperatives that can maintain buyer and member relationships, even if adaptations are required, will have a greater ability to make up financial losses when the shock of this pandemic is over. Development organizations should be coaching and mentoring cooperative management and board members to communicate frequently and transparently with these stakeholders to ensure relationships are maintained and strengthened during this time.”

Collaboration has played a vital role in making this study happen, as well as making the learnings impactful and widely applicable. Kari and Land O’LakesVenture37 urge cooperatives and NGOs to collaborate on solutions to challenges to promote stronger and more sustainable resolutions. Thank you to NCBA-CLUSAEqual Exchange, and Global Communities for making this study possible.