The rapid expansion of modern food retail encapsulated in the so-called ‘supermarket revolution’ is often portrayed as a pivotal driving force in the modernization of agri-food systems in the Global South. Based on fieldwork conducted on horticulture value chains in West Java and South Sulawesi, this paper explores this phenomenon and the concerted efforts that government and corporate actors undertake with regard to agri-food value chain interventions and market modernization in Indonesia. The paper argues that after more than 15 years of ‘supermarket revolution’ in Indonesia, traditional food retail appears not to be in complete demise, but rather adaptive and resilient to its modern competitors. The analysis of local manifestations of supermarket-led agricultural development suggests that traditional markets can offer certain advantages for farmers over supermarket-driven value chains. The paper further identifies and discusses two areas that have so far been neglected by research and policymaking and which warrant further investigation: (i) the simultaneous transformations in traditional food value chains and their relation to modern markets, and (ii) the social and environmental performances of modern vis-à-vis traditional food value chains.
1 January 2011 in International Journal of Technological Learning, Innovation and Development
This paper addresses the main dynamics in the global agro-industrial value chains for tropical products. It examines new upgrading opportunities for smallholder production in Africa as a consequence of two dominant trends within global agricultural value chains. The first is caused by the dynamics of the co-existing collaboration and intensified rivalry between lead firms within the same chain. The other is caused by new opportunities and challenges stemming from increased requirements on retailer-driven markets in the North and expansion of new markets in the South. The paper points out the need to rectify the heavily biased policy focus on standard compliance with the purpose of strengthening smallholder incorporation and upgrading in retailer-driven strands of global value chains ending in the North. Instead, markets in the South and in emerging economies may function as a training ground for upgrading of African smallholder production via increases in volume and consistency of exports.