Farmer-entrepreneursoperate in a complex and dynamic environment. They are part of a largercollection of people including other farmers, suppliers, traders, transporters,processors and many others. Each of these has a role to play in producingproducts and moving them through to the market and value chain.
They also needto respect each other and work together to make the whole system work betterand be more profitable. Being an entrepreneur is a way of life and a way oflooking at the world to enjoy independence and freedom. They decide forthemselves what to do, they also need to face risks and to cope with the risksthey will face in the complex world in which they compete, they need to developan entrepreneurial spirit. Working under pressure and immediately accountablefor the outcomes good or bad of their decisions.
While farmer-entrepreneurs arefree and independent, they do not work alone. They operate in a complex anddynamic environment. A farmer with an entrepreneurial spirit energetically, enthusiasticallyand carefully makes many different decisions about his farm in the context ofthe value chain that influences the profits of the farm business.
This is allhappening in a dynamic, ever-changing and uncertain setting. To make sure their farm businesses developand adapt in response to these changes, farmer entrepreneurs need to focusingon their purpose to do the best to turn every event to advantage.They also need toseize every opportunity and make the best of it to make the whole system workin favour.
The ‘way of life’ of a farmer-entrepreneur also has its pros andcons, they are freedom in making decisions about the business and therelationship with family, control over what has to be done, when and in whatorder. They are working alone often in solitude to coping with a wide range ofmanagerial and daily tasks. However, they will live with uncertainty if cannotgenerate profit you may not survive in the future. It also facing the riskingpersonal assets and security, high level of responsibility and risk of failure.Living with an inability to control the actions of stakeholders upon whom thesuccess of the business depends on develops trust and alliances with otherstakeholders where mutual benefits exist. They also need working in long timeand irregular hours to meet demands but they also can closely interwoven familyand business life.
Last, good social is linked to the success of the businessand be ready working under pressure from stakeholders, by solving problems,experimenting, seizing opportunities, and learning from competitors. Entrepreneurshipdynamics but beyond this, successful farmer-entrepreneurs are technicallycompetent, innovative and plan ahead so they can steer their farm businessesthrough the stages of enterprise development – from establishment and survivalto rapid growth and maturity. However, there are many challenges that thesefarmers face: social barriers, economic barriers, regulations, access tofinance and information, and their own managerial capacity to cope with risksand changes and to seize opportunities. Next,the appendage of “Halal”, to a product it has also become a global symbol forquality assurance and lifestyle choice and not just a guarantee that theproduct is permitted for Muslims. This is evident by the participation andinvolvement of non-Muslim countries and organisations where halal is fastemerging as the standard of choice. Many Western countries have recognised theemerging global trend in consumerism towards halal products and services, andare now racing to gain a footing in the halal industry.
Agrowing market force Muslims represent an estimated 23% of the globalpopulation or about 1.8 billion consumers with an average growth rate of 3% perannum. If this growth trend continues, Muslims are expected to make up about26% of the world’s total projected population of 2.2 billion in 2030. The twostrongest markets for halal products are the Asia Pacific and the Middle East.
More than half of the global Muslim population lives in the South Asia and AsiaPacific and the number of Muslims from region are expected to reach 1.3 billionby 2030. With Muslim youth now accounting for 11% of the world’s population andrepresenting just under half of the total global Muslim population, demand forstylish halal brands is expected to increase significantly. Halal products on the rise and the halalfood marketplace is emerging as one of the most profitable and influentialmarket arenas in the world food business today. The halal food market has grownstrongly over the past decade and is now worth an estimated USD667 million. Halalfood represents close to 20% of the entire global food industry. With expectedincreases in both population and income of halal consumers, future demand forhalal food is strong. The rising halal consumer power as a market force in tandemwith the growth of the Muslim population and their rising disposable income.
Thereis greater awareness among Muslims on the need and necessity to consume onlyhalal food. In Malaysia, for example, Muslim consumersspent an average 14% of their food budget on meat. 60% of the halal meat isimported from India, Australia and New Zealand. Countries like Brazil,Argentina, New Zealand and Australia have established themselves as marketleaders in the export of halal meat and poultry.
Halal food products are notconfined to meat and poultry, including other food items such as confectionary,canned and frozen food, dairy produce, bakery products, organic food, beveragesand herbal products. Another growing sector of foods is comprised ofsubstitutes for products that traditionally contain non-halal (haram)ingredients such as pork gelatine or alcohol. These products, which includeyogurt, biscuits, and chocolates, are now being modified so that they can bemarketed as halal. Theglobal halal market has emerged as a new growth sector in the global economyand is creating a strong presence in developed countries. With a growingconsumer base, and increasing growth in many parts of the world, the industryis set to become a competitive force in world international trade. The halalindustry has now expanded well beyond the food sector further widening theeconomic potentials for halal.
Asia has the fastest growing region for halalproducts is Asia, driven by countries like Indonesia, Malaysia, Pakistan, Chinaand India. Since this region has the largest Muslim population in the world,Asia has become an important and lucrative halal market. The increase inpurchasing power of consumers in this region also brings about demand for morediversified products, opening up a new and growing market for halal producers.A number of Asian countries have been actively promoting themselves as centresfor halal production, standardisation, research, and international trade.
Malaysiahas been aggressively promoting itself as a leader in the global halalindustry. The market size of the halal industry in Malaysia is estimated to beUSD1.9 billion with 90% contributed by the food industry. Export of halalproducts contributed about 5.1% of the country’s total export and is expectedto record an increase of 6% in 2013. The major bulk of halal products exportedwere ingredients, food and beverage and palm oil. The top country destinationsof halal products from Malaysia are China, the US, Singapore, Netherlands andJapan. In Malaysia, a more holistic approach towards the development of a halalindustry and creating a halal ecosystem is being undertaken by the governmentwith the principal aim of positioning Malaysia as a global halal hub by 2020.
As one of the country’s engines of growth, the halal industry is expected tocontribute 5.8% to the country’s gross domestic plan by 2020 from less than 2%currently. Comparedto other countries in the region, Malaysians are among the most knowledgeablein organic food and their health benefits. The Chinese still remain the majorconsumers of organic food in Malaysia, the younger Chinese generation havestarted to take a keen interest in organic food, unlike in the past where itwas mostly the older Chinese generation. Other races such as the Malays andIndians have also started to try organic food, although their numbers stillmake up a small fraction of Malaysian consumers. Since2006, very few family-run organic shops have opened. Instead, their roles havebeen taken over by big retailers like Cold Storage, Jusco Supermarket, Tesco,Giant, and Carrefour.
All large supermarkets in Malaysia is carrying certifiedorganic food in large quantities and varieties. Smaller and more upscalesupermarkets like Mercato, Isetan Supermarket, and Village Grocer also stockcertified organic food. The hub of vegetable farming in Malaysia can be foundin Cameron Highlands. Grace Cup Sdn.
Bhd. and Cameron Organic Produce Sdn. Bhd.It is established by Lee Ong Sing in 1997 have established organic vegetablefarms in Cameron Highlands.
Nonetheless,organic agriculture and food are facing several challenges in Malaysia.Although the demand for organic food in Malaysia is growing, the supply oflocal organic produce is not keeping up with the increased demand. Local supplycan fall by as much as 50 per cent in certain periods of the year. Beside theinconsistent supply, the varieties of local organic food are also limited.Consequently, Malaysia still needs to heavily import organic produce from othercountries, especially from Australia, U.S.
, and New Zealand. Anotherproblem facing organic food consumers in Malaysia is the price differencebetween organic and conventional food. Although it is well known that organicfood is more expensive than conventional food, their price difference inMalaysia is particularly substantial, by as much as 100 to 300 per cent,compared to only 25 to 30% price gap in the U.S. and E.U.
Despite the higherprice and limited variety of organic food in Malaysia, I foresee that organicagriculture and food would continue to rise rapidly in Malaysia as Malaysiansbecome more health and environmentally aware.