The co-operative Asociación Agrícola Cañera del Sur has 330 members, and is located in Iturbe, Paraguay, a region historically known for sugar cane production.

It is a democratic association of small-scale farmers who grow sugar cane, cotton and soybeans and tend livestock on farms averaging 15 hectares in size. The association was set up to negotiate with the processing mill for the raw cane, which it still does along with maintaining local roads and providing medical assistance.

Conventionally in Paraguay, and in the case of Iturbe, farming sugar cane has been marked by individual commercialisation by producers, low bargaining power, no access to price and market information and low prices that fail to provide sustainable livelihood conditions for producers.

Paraguay has a long history of dictatorship government that only ended in 1989. Repressive measures led to weak social organisations. Progressive ‘popular’ organisations were forbidden. Families had had little opportunity to develop their own security of income during this period, and even today shortages of capital prevent most farms from being fully cultivated. Migration of family members to nearby Argentina provides additional income for most families but adds to rural depopulation.

It is difficult for small producers to rely on government help as the government does not provide access to credit, nor does it promote urgently needed soil recuperation projects. Soil recuperation is very important in the Iturbe region as the land is already very old.

Getting more value added
Sugar cane processing requires large milling facilities. In most cases lack of capital prevents small-scale farmers from owning their own mill. In addition to them not benefiting from the processing value-added, they have no experience in trading in a world commodity market. It is one of the long-term aims of Fairtrade to allow farmers to gain such experience.