Whereas many smallholder farmers rely on rather diversified production systems, commercial market-oriented agri-food production is increasingly concentrated amongst midsize and larger farmers. We use data from the Value Chain Analysis for Development (VCA4D) project to (a) identify farm size structures in eight agri-food value chains in sub-Saharan Africa, (b) explain variation in farm size structure between commodities, and (c) discuss the implications for agri- food sector transformation dynamics.

Our cross-sectional analysis shows high labour intensity and low value added in the midstream segment of the value chain as factors favouring smallholder-based systems. On the other hand, high capital intensity of the production systems and high-value added in the mid-stream favour midsize and large-scale dominated systems. Changes in the farm-level production structure thus have direct implications for the organization of midstream trade and processing firms and shape the value added distribution between value chain stakeholders. Such farm- firm interactions are also influenced by country-level differences in urbanization, economic growth and market development. Crop-level differences offer particular opportunities for labour intensification in smallholder systems, while bimodal and large-scale systems rely more on input intensification.

The emergence of medium- and large-scale farms seems to be a key feature of agricultural transformation. The transition towards a bi-modal or large-scale dominated farm sector can boost agricultural productivity but, as such, can also be expected to be disruptive for existing smallholder farmers. The extent to which this transition is inclusive and can support structural transformation will depend to a large extent on the employment creation in the farm and mid- stream segments of the value chain that result from this transition.