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Structure, operation and management of farmers’ organizations
3.4.7 Output marketing
Marketing produce is one of the main services provided by most FOs. To be successful 
in doing this, FOs must be able to analyse market information, identify opportunities, 
negotiate contracts and sales, collect, store and transport produce, and pay members 
on time. The ALSCs in Indonesia, the Samroiyod Shrimp Farmers Cooperative in 
Thailand and the NaCSA’s farmer societies in India all coordinate the sale of bulked 
produce to processors and exporters. 
3.4.8 Trading and intermediation 
Going one step further than just coordinating the sale of bulked produce, some FOs take 
on the role of trader or intermediary by negotiating contracts with buyers and purchasing 
produce from members (and sometimes non-members), ensuring it meets the quantity, 
variety or consistency of supply demanded by the buyers. For example, FOSCOT 
(Case Study 1) acts as an intermediary and has recently negotiated a contract to supply 
a large amount of shrimp to a national processor. To meet the contract requirements, the 
federation has had to supplement the shrimp bought from cooperative members with 
that of non-members, and will earn a commission on the total sale. Intermediary models 
drive change through negotiating with actors, improving efficiency through greater 
organization, and improving information flows and shared standards along the market 
chain. While FOs may want to “cut out the middleman”, chain intermediaries are often 
• providing technical services, including advice on application of BMPs, monitoring 
adoption of BMPs, disease diagnosis, screening inputs for banned antibiotics, and 
providing information and extension training;
• providing market services, including sourcing and bulk buying of good-quality feed 
and seed, coordinating sale of bulked produce to one processor/exporter, etc.; and
• record-keeping at all levels to enabling traceability back to shrimp farms and hatcheries.
Planned activities include introduction of banking services and microfinance facilities 
and building awareness among members of finance, credit, savings, small-scale business and 
investment opportunities.
The Aceh Aquaculture Communication Centre (AACC) was established in 2009 with the 
approval of the Indonesian Government, funded through the ADB-ETESP and technically 
advised by the ETESP and the NACA. The AACC provides information and communication 
services related to aquaculture direct to farmers and their associations through the ALSCs, 
including market information, technical information, disease diagnosis and training services. 
The AACC works with aquaculture FOs primarily through the ALSC system; however, 
services can also be provided to farmers outside the established ALSCs’ areas on a needs 
basis.
The ALSC-AACC model has had very positive initial results. Farmers have reduced disease 
risk through implementation of collective stocking and crop planning. Communication has 
increased through ALSC Web site facilities, improving transmission of information related 
to disease outbreaks at the village, subdistrict and district levels, and providing a platform 
for improving business and collaboration among all stakeholders, not just farmers, and 
reducing the gap between farmer communities and stakeholders. The ALSC system has also 
encouraged exporters and processors to visit ALSC sites and started preliminary discussions 
for group harvests and on processes leading to the introduction of a traceability information 
system. In the future, it is expected that the ALSCs and the AACC will become self-sustaining 
units, providing business, technical and communication services to fish/shrimp FOs, largely 
independent of government and external agencies.
Source
: Ravi Kumar and Yamamoto (2009).

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Aquaculture farmer organizations and cluster management – Concepts and experiences
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vital in linking smallholders to markets, especially those farmers who are located far 
away from markets. Recent attention has focused on a new generation of “doubly-
specialized intermediaries” (business-oriented and development-motivated), and is an 
area that appears to offer great potential for linking business with small-scale producers. 
FOs in the agriculture sector are developing innovative models of intermediation as 
alternatives to vertical integration; however, the majority of intermediary initiatives 
are still dependent on donors and NGOs, raising questions about their comparative 
advantage over traditional intermediaries. If the real costs of intermediation are going 
to be subsidized by external agencies, there must be an exit strategy in place that leaves 
behind a healthy and intact chain (Vorley and Proctor, 2008).