Introduction

Intermediarism is a complex and confusing issue. In the peasant sector, it is handled with many assumptions, and there are different perceptions about this sector. The term intermediarism is part of the common language in the agricultural sector and refers to the economic agents that carry out commercial activity and appropriate a considerable part of the value generated in production units. Intermediaries constitute a bridge - sometimes necessary - between the primary producers’ needs for trading and the last stages in the production-consumption chain. They are economic agents specialized in buying and selling, stockpiling and transporting, primary products to distributors; and they usually also have valuable information about the market, outflanking the primary producer with this. When the number of intermediaries in the same chain increases, it results in excessive intermediarism (^{IICA, 1987}). This characteristic means that the proportion of the final value of the product that the primary producer could aspire to retain decreases significantly. The place where intermediarism primarily happens - or is most aggressive - is with small-scale producers; they facilitate these practices of intermediation when their operations are not very efficient, such as: by purchasing expensive inputs or having scarce productivity by not attaining the acceptable volumes of harvest that buyers demand, circumstances that do not stop them from having conditions to negotiate a better price for their products (^{García, 2008}).

In addition to the bad practices, there is the formation of an asymmetrical structure in rural areas. According to ^{Saavedra and Rello (2010}), welfare policies in Mexico derived into small-scale farming that is currently and regretfully identified as a figure of poverty in agriculture. For example, according to ^{FAO (2014)} this affects the existence of a dichotomous and inequitable agrarian structure, between them and those who have resources at a larger scale.

When addressing the issue that refers to agricultural and livestock production, ^{Saavedra and Rello (2010}) refer that a large part of the percentage of wealth in the Value Chain is linked to relevant economic functions such as trading and stockpiling, which, for misfortune of the producers, are habitually dominated by commercial intermediaries. To get a clearer idea about this aspect, the following graphic representation about the participation of different actors within the Chain was elaborated in order to determine in a mathematical way the price that is paid to the producer at the farm; the figure shows that in the best case scenario, the primary producer scarcely appropriates 35 % of the final price, that is, a third (Figure 1).

Figure 1 Graphic representation (calculation of the portion that the producer receives). 

Analyzing Figure 1 the following basic processes are observed: selection and processing, management of perishable products, workforce, transport, temporary storage, commercial utilities, etc. The relevant fact is that many of these processes and tasks are operated by commercial intermediaries. In addition, it should be considered that these agricultural products are, in their majority, voluminous and perishable raw material that requires extensive and careful management for it to reach from the farm to the final consumer; these specialized tasks are operated efficiently by the commercial intermediaries.

If the expectation is to obtain a higher percentage compared to the small portion that the producer receives, it is desirable to be competitive (^{Díaz Fernández, 2009}), focusing on appropriating at least the links from the Chain Value that have the greatest impact on wealth retention, such as stockpiling and trading. When reviewing these aspects, this study was undertaken, derived from the interest in understanding and examining some tested strategies by producers on wealth appropriation, evaluating directly and indirectly the real scenarios of the producer, analyzing some of their experiences and reviewing the contributions from producers’ organizations focused specifically on reducing intermediarism in the agricultural sector.

The experience rescued from the National Association of Trading Businesses (Asociación Nacional de Empresas Comercializadoras, A.C., ANEC), through their leaders, as well as the one observed during the path of the first author in the development bank, shows that successful experiences in trading have taken place in what refers to small-scale producers. On the one hand, there is the history of the ANEC itself, which was constituted on September 8, 1995, and currently associates 220 Peasant Commercialization Businesses (Empresas de Comercialización Campesina, E.C.C.) in 19 states of the republic, which represent 50,000 small and medium scale producers of basic grains, and have the operation and administration of 207 storage units for compacting and trading maize, sorghum, wheat, bean and rice.

For the research, the following questions are set out:

The general objective has the aim of identifying the influencing factors for producers to achieve retaining and appropriating wealth, contributing to reduce the margins of intermediation, considering the circumstances of the social environment and the different economic and political scenarios.

Specific objectives:

Stemming from the questioning exposed about the phenomenon of intermediarism, we suggest responding them by adopting the following hypothesis: “professional association effectively allows the producer to retain and appropriate portions of the wealth generated in the trading and stockpiling links of the Value Chain”.

Intermediarism leads to economic inequality and to counteract or minimize its effects, there is the need to implement professional association, understanding this concept as the grouping of a set of individuals that develop the skills that effectively allow retaining and appropriating portions of wealth that are generated in the other links of the Value Chain, additional to primary production.

The approach of value chain represents a primordial aspect to be adopted by producers; it is defined as a model of analysis and intervention that seeks to add sustainable economic and social value for the people that make up the most vulnerable links (trading and stockpiling), which have great potential to have favorable results (^{Arvizu et al., 2005}).

The concept of “association” was proposed by recognized authors like ^{Ruíz and González (2002}), who suggest that the producers should be “associated” to execute their decisions in face of a complex and free-market economy; in addition, it has the objective of maximizing their utilities in the process of purchase or sale. “Association” is also characterized, among other characteristics, by synergy, solidarity, shared knowledge, support networks, and is directly related to the ability to negotiate and to differentiate effectively between human, monetary or time resources; association, as a mechanism of cooperation, does not necessarily have an impact on reducing the autonomy of producers, implies a voluntary decision when participating in a joint effort with the other participants in the search for a common objective (^{Lozano Monroy, 2010}).

An efficient activity for the producer to retain wealth and maximize his financial utilities is reaching the lowest purchasing prices in the inputs and the highest in sales; this happens most frequently when he is “associated”, reinforcing the success of his commercialization. Associating professionally implies radical changes in the attitude of the producer; it is not as simple as being organized, coordinated and cooperating between them, but if they really have the ambition of retaining wealth they will demand these actions to face such as complex market and which is not regulated (^{Ruíz and González, 2002}).

Therefore, some alternatives of response to the questioning set out are identified based on the following: for the part of professional association, resuming the knowledge tested and applied by the ANEC in their business model Peasant Trading Company (Empresa Comercializadora Campesina, E.C.C.), which results from the consultancy and technical accompaniment for the enterprise PROMACOCH that arose from producers’ wish to appropriate the trading link. On the other hand, to take up again the experiences of PROMACOCH producers, particularly focused on solving their deficiencies in terms of: productivity, high costs of inputs, ability to become organized for negotiating.

Results and Discussion

The generation of wealth by the producer requires appropriating at least the link of trading. Attempting to reach this goal demands at least the following aspects: adopting a professional association, coordinating better, improving productivity, and decreasing the costs of inputs. The domestic demand for maize demands higher volumes than those that small-scale producers can offer; in addition, there is a need for specific characteristics in terms of quality, size and variety. These situations have to be solved before attempting to negotiate effectively their products with their possible buyers; the agricultural market changes in a dynamic way. Since CONASUPO disappeared, it was evident that there was no knowledge of the market and that this process is the most important problem that the producer faces once the harvests are finished, and that it has driven the producers to seek other options, such as the specialization of production to improve the yields and the quality of maize (^{Maximiliano-Martínez et al., 2011}).

For this reason, there is agreement with the concepts by ^{Hirschman (1956}) and de ^{Roekel (1995}), about the advantages of wealth generation that other links in the value network different from the first link produce.

The producers require understanding the agricultural market, as defined by ^{Caldentey (1992}). The lack of information affects their commercial performance, which is why the ANEC developed communication strategies for members of PROMACOCH with the information of agricultural markets; these included the dynamic behavior, the prices, the offer and the demand for basic grains.

Aside from the lack of understanding of agricultural markets, it was observed that most of the primary producers of maize act daily in an individualized manner. This rationalist approach accepts individualism, based on the principle of individuals being self-interested; that is, directed at the satisfaction of their own interests, desires and activities defined in the material and political aspect of their environment (^{Vargas Hernández, 2006}). In addition, they face other adversities: effects of climate change, natural disasters, pests and droughts, so there is no other option other than thinking in an economic safeguard. These unfavorable conditions originate for producers to visualize the intermediary or coyote as “a necessary evil”; sometimes there is no other option other than selling to them. From the content of the ethnographic file cards, some perceptions are observed of the commercial intermediary, which the producers called “coyote”.

“the coyote has the function of uniting the producer with the final consumers of what he produces and this function becomes more important, until sometimes it is indispensable for the producers who are under precarious conditions of production (one to three hectares of cultivated surface at most); they almost always depend on support from the «Intermediary-Coyote» to trade their scarce harvest, in fact sometimes selling their own harvest for subsistence.” (Interview with Salvador M., Anastasio H.; PROMACOCH maize producer members (04/2012)

“that intermediaries can dominate the task of buying and selling, and that they execute it much more efficiently than the producers devoted solely to the productive process, we recognize the advantages that the «Intermediary-Coyote» has, because he knows his tasks and usually performs them well, maybe this happens because he is focused on this process only”. (Interview with Julio F., Norma A., Valentín T.; PROMACOCH maize producer members (04/2012)

“how is it possible that someone who does not have money and who is not doing a tangible job such as mine is paying from my own product?” (Interview with Cristian M.; PROMACOCH maize producer members from, 09/2012).

As is perceived in the comments, the participation of the “coyote” is a fundamental part in commercial intermediarism; these are traders that offer credits to small-scale producers of plots of less than 2 ha, with the objective of ensuring the purchase of the harvests, imposing their conditions for negotiation and the prices that are paid to the producer.

PROMACOCH arose in a complex context and of high uncertainty dominated by intermediarisim; by 2006 they took the idea of appropriating trade. From being isolated and individualized primary producers, they grouped together and decided to create a Rural Production Society with an initial objective: selling the public company responsible for supply in the rural environment for the Conasupo Distributers System (Sistema de Distribuidoras Conasupo, S.A. de C.V., DICONSA), in a direct way and without intermediaries, objective that regrettably was not fulfilled initially, by virtue of the group not being able to satisfy the requirements demanded by that enterprise.

“the exercise of selling to DICONSA was like a first and last time, since although it was an excellent commercialization option the purchasing volumes required by DICONSA produced by PROMACOCH were not available, in addition to lacking the infrastructure of warehouses, which must be certified, is a scheme for large producers’ organization.” (Interview with Ing. Josefina Torres; State technician from ANEC, 05/2015).

Although the objective failed, the producers had given a valuable first step, which is why the government of the state of Guerrero decided to continue fostering their initiatives. With this purpose, the state government contacted the ANEC directly in 2006, which was considered to be a producers’ association specialist in the area of agricultural commercialization. The intention was for ANEC to guide the PROMACOCH producers to be able to constitute themselves as a trading business through the adoption of their model of Peasant Trading Company. The producers were in agreement at the beginning and put aside idiosyncrasy, individualism and egoism among them; the interest and strategies that the ANEC could implement was considered more valuable in the PROMACOCH enterprise.

The starting point of the ANEC’s work was in 2010; first the application of a specialized diagnosis of the PROMACOCH organization was established, with the 160 original associated producers, in order to assess and identify the necessary actions for them to become a trading company. The general results showed many insufficiencies and deficiencies with higher or lower degree of impact in matters of: organization, planning, administration, production and technical management of the grain stocked, as well as optimization of the financial, material and human resources.

In addition to these unfavorable results from the diagnosis, valuable information was found from the interviews registered in the ethnographic file cards. The producers described that they could not sell to DICONSA because their infrastructure was insufficient and the one available was not certified; due to this, they could not gain access to credits for commercialization, since pawning harvests demands duly certified infrastructure. Another relevant aspect was the analysis of the product quality; their lack of financial resources to acquire laboratory instruments did not allow them to analyze the quality of their product; in addition, they did not have competent staff to perform these analyses. Likewise, they pointed out that their organizational operations turned out to be quite deficient, reflecting many internal conflicts, and there was no updating of the administration council, overly critical scenario, since it made legal procedures more difficult for the organization of producers.

Despite the aforementioned, the government in Guerrero decided to support this group of producers again. A new project was generated, which considered as priority the following actions: improving the production and productivity of those involved in order to reach better profitability rates; undertaking the negotiations necessary both inside the organization and with financial institutions, in order to obtain credits that allow the use of better technological packages; and giving training for the comprehension of the new schemes in commercialization and organizational management. A strategic plan was developed that allowed reaching these objectives in the year 2010, which is why a series of activities were implemented such as workshops, installation of plots for technological development, accompaniment and permanent technical consultancy.

As a result of these actions, the productivity to obtain higher volumes in agreement with what buyers demand increased from two tons per hectare that they produced in 2006 to almost seven; by 2015, their production increased more than three-fold. The increments in productivity of their lands were achieved through technological transference; also, in 2013 they obtained a credit with the purpose of improving the technological packages that were obtained after a long period of prior negotiations. Producers and leaders were trained for associates to be able to work and learn to negotiate between them, facing commercial challenges in a joint manner; they were trained in management of market information and prices of basic grains, in order to learn to interpret them to their benefit, gaining access in an efficient and timely manner to data that were current.

The next step was for PROMACOCH to adopt the commercialization model of the ANEC, that is, they became a Peasant Trading Company (Empresa Comercializadora Campesina, ECC). The fundamental objective was to transcend the sphere of primary production, which is why they had to be subject to several evolution processes, ranging from schemes of agrarian and productive organization towards economic organization models specialized in commercialization. In the implementation process there was a strong demand for commitment and requirements for producers, which is why a particular phenomenon happened, the desertion of many producers, so PROMACOCH was reduced to only 65 producers from the original group of 160; this was caused more by agrarian conflicts, disagreements, divisions and controversies among them and not so much by the process mentioned.

It is observed that although they were organized to establish a Rural Production Society (Sociedad de Producción Rural, S.P.R.), this was not a guarantee for success. Although they were constituted legally, they needed guidance and specific consultancy to negotiate and coordinate adequately among one another; this is what it means to have a professionalized association, as defined by ^{Ruíz and González (2002}). It is evident that it was not enough to have a producers’ organization that was constituted as a legal society, but rather it was more important that they could act united in search for a common benefit for all; therefore, it was necessary to «become professionalized». The professionalization that producers adopted was the social process by which the skills of producers improved to make them more competitive in terms of their profession or trade. The producer was obligated to develop skills according to what he faced in his productive, commercial, day-to-day work; it also implied a change in perspective, thought and traditional approach, with all that going beyond focusing on primary production represents.

The innovative professionalization model allowed PROMACOCH to visualize other markets, such as that of the dough and tortilla industry, managing since 2014 to appropriate better technologies to increase production. They bought improved seed, but no longer in an individualized way but as a group; this allowed them to reduce their costs from inputs and to focus on the commercialization of their product, when selling directly to tortilla shops in the state of Guerrero, since the best market price for the maize product is given by the tortilla maker.

Due to the new skills they acquired, PROMACOCH producers reoriented their commercialization approach by removing from their sales the agricultural intermediary and they sought new sales options for their product. This was the result of the work of training and permanent technical assistance with the ANEC.

This new approach allowed finding a new commercial option: selling directly to tortilla makers. However, this has not been crystallized completely yet, since the buyer offers the best prince in exchange for the grain to be delivered packaged, winnowed and very clean; that is, a process of selection and processing of the product offered is needed in order to deliver a degree of quality that the tortilla makers demand, in addition to stockpiling it adequately, infrastructure that is not yet available for PROMACOCH; presently work is being done in these requirements from the client.

There are good favorable results, since it has been proven that by being professionally associated it was simpler to find and locate more attractive market alternatives, such as selling directly to the tortilla maker. These actions would generate very important tangible economic benefits and even to appropriate economic margins in the order of 30 to 40 % of the final value of the product. Although it is a desirable scenario for them, in reality there are still opportunity areas that have not been solved completely; for example neither the group or producers nor the tortilla makers have infrastructure to store the maize and, then, to manage it according to the everyday requirements. There is need for at least one small warehouse with gable roof that allows stockpiling the grain selected for the tortilla shops; in addition, there is need for transport to supply the clients constantly their daily needs for the product; they are still struggling to acquire the infrastructure and operation management required for the new identified market.

A somewhat undesirable result is the reduction to 65 affiliated producers with 200 ha, from the 160 of the total initial partners of the S.P.R.; throughout time many personal differences came up, because not all producers had the same interests and approach towards commercialization; this aspect provoked mainly the generation of impulsive internal conflicts, resulting in social breakups and the lack or null negotiation among them, falling into the separation of many members of the S.P.R. It is important to mention that this happened despite most of them staying involved in entrepreneurial training, direct attention and consultancy from the ANEC; however, the negative emotional reactions of many of the producers were stronger than the economic reason of the society, with the decision of leaving the organization over differences in interests predominating, even over the understanding that by continuing to act individually they would not be able to change their conditions of dependence on intermediarism, so they decided voluntarily to return to their status of small-scale producer.

Conclusions

In the rural environment there are many diagnoses about agricultural commercialization, but using these can cause extracting wrong conclusions and actions in face of a scenario that is not totally clear. As initiative of this study, the authors sought the comprehension of adverse situations that small-scale farmers or small-scale agricultural producers of maize withstand, who are regularly facing excessive intermediarism, a free and unregulated market which also has the presence of monopolies and oligopolies; the producers face this challenge with minimal defense elements in face of these adversities.

In this article, we attempted to describe the initial conditions of a group of primary producers, unionized in the rural company PROMACOCH, and members of the ANEC. Initially they experienced the ins and outs of being disorganized and survived in a market full of intermediaries; under these conditions it was clear that they did not have the possibility of appropriating trading and also had an emerging productive activity that sometimes only allowed them auto-consumption. This position of isolation and null cooperation among one another caused for them not to appropriate and retain portions of wealth and, therefore, they had an unstable, difficult and uncertain quality of life.

The primary producer is normally focused on and considers many times that his main objective in the country life is to produce the highest yield of tons per hectare; he invests heavily in cutting-edge fertilizers, crop pest control, technological packages; he obtains credits to sow, fertilize and harvest, to only realize at the end of the day that even with a high yield volume in tons per hectare, his dividends were minimal compared to the earnings that commercial intermediaries obtain in a few days.

The theme of association is vital to make an incursion into other levels of producers’ organizations. However, there is an important statistical indicator: most people in the countryside are older, the average age of the heads of agricultural-livestock households was 53 years in 2004 (^{Grammont, 2010}). The perception of this generation is to “not go into” entrepreneurial training, and sometimes they only approach the “technical” specialization that they receive from “agronomic technicians” about how to produce more. This is important, however, in most cases it is executed without understanding if there are favorable conditions in the market or if there are identified buyers to sell the projected production to. It was observed that the vision of the producer was shortsighted, limited and partial regarding the real environment of the economic scenarios.

Primary producers are a fundamental and strategic part of food sovereignty in our extraordinary country. They should be “seen as rural entrepreneurs”; they are an essential part of the strategic projects of innovation for the «farmland», understanding that these projects are the proposal of rural producers to add value to their production, collaborate in a collective edification that is expressed in the accompaniment of a transition of the primary link in the consumption production chain that is characterized for being individual, of low rent and scarce sustainability, and to be able to transcend and evolve into a process of value aggregation, entrepreneurial development, that is competitive in addition to sustainable.

There is a subordination of the peasant with various mechanisms that operate in the Mexican agricultural market, as for example what is caused by the intermediary who fixes a low purchasing price; this achieves the supply to large cities, but at the expense of confining the primary producer to subsistence earnings. However, when the small-scale producer is professionally associated, he knows how to negotiate, cooperate and becomes coordinated.

It is concluded that certainly the hypothesis proposed is fulfilled in part, since intermediarism and its negative effects are reduced when effectively there is professional association and, in fact, the producer is allowed to retain and appropriate portions of the wealth that is generated in the trading and stockpiling links of the value chain. However, the following should be considered: if the producer hopes to retain and appropriate wealth in the value chain, he will have to face the challenges that internal and external factors in his environment entail. He may be able to acquire the necessary professional skills, but he needs to understand in a practical way that the objectives of the enterprise are attained when there is cooperation, coordination and negotiation between its members; in addition, this allows them to have better capacity for commercial negotiation with the buyers.

This article ends with this contribution: only as one more solution alternative to the issue of intermediarism, producers need to be seen as «Productive subjects with needs for: continuous training, technical assistance and professional accompaniment»; new agriculture and livestock policies should be established with «multi-annual approach» that allow the State to design new strategies for supports to the farmland, eliminating the idea of peasants being a poor sector that only need welfare policies.