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Quick summary: Discover how empowering smallholder farmers can transform global food systems, improve sustainability, and enhance food security. Learn about the challenges they face and the solutions that drive their success.
Smallholder farmers, typically cultivating less than two hectares, are critical to reducing poverty, ensuring stable food supply chains, and advancing environmental goals. Their diversified farming practices preserve biodiversity, strengthen local food security, and drive climate-resilient agriculture by adopting low-input, sustainable methods. Because they supply both local and global markets, smallholders are essential to achieving sustainable food systems and meeting global sustainability targets.
The world’s smallholder farmers produce around a third of the world’s food, according to detailed new research by the Food and Agriculture Organization of the United Nations (FAO).
Despite their small scale, they are hugely impactful, producing over one-third of the world’s food and sustaining the livelihoods of nearly 2 billion people globally. Yet, sustainability goals cannot be achieved without them. Climate resilience, biodiversity conservation, and deforestation-free supply chains all depend on empowering these farmers to participate fully and meet new regulations. See how tech platforms like TraceX help them overcome these challenges.
Key Takeaways
Smallholder farmers, those managing less than two hectares of land, play a critical role in sustainable food systems. They produce over one-third of the world’s food (FAO), supply both local and global markets, preserve biodiversity by maintaining diverse crops and ecosystems, and adopt regenerative practices that build climate resilience. Their contributions are essential to achieving food security and sustainability goals worldwide.
Smallholder farmers are the backbone of both local and global food supply chains. Because they cultivate a diverse mix of crops on small plots, they feed rural communities while also supplying urban markets and export channels. In many regions, their flexibility allows them to pivot quickly to meet seasonal or regional demand—something large, monoculture farms struggle to do.
Unlike industrial-scale farms, smallholders often maintain traditional seed varieties and practice intercropping, which enriches soil and reduces reliance on chemical inputs. Their farms act as living gene banks, preserving indigenous crops that might otherwise be lost. This biodiversity isn’t just ecological—it’s economic, offering buyers unique, specialty-grade commodities.
Smallholder farmers tend to adopt low-input, regenerative practices like mulching, cover cropping, or agroforestry. These practices increase carbon sequestration, improve water retention, and create microclimates that protect yields against drought or extreme weather. Their localized knowledge often outpaces top-down climate adaptation plans, making them natural leaders in sustainable land management.
While global narratives often frame smallholders as vulnerable, they are also innovators and custodians of resilient food systems. Their scale allows for rapid experimentation with sustainable practices, and when equipped with technology (like TraceX’s digital traceability and farm management tools), they can leapfrog traditional barriers, proving compliance, reaching premium markets, and directly contributing to climate and biodiversity targets.
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Power of regenerative agriculture, and how smallholders drive sustainability from the ground up.
Smallholder farmers face three major challenges: limited market access, which reduces their income; complex compliance demands such as EUDR and certifications, which require data and documentation they often lack; and finance and resource constraints, limiting their ability to invest in better inputs and infrastructure. These barriers hinder productivity and prevent them from reaching premium, sustainable markets.
Smallholder farmers often operate far from established trade hubs, relying on middlemen who absorb a large share of value. Without digital tools or verified supply chain data, they struggle to reach premium buyers or certification-based markets. This isolation means their produce, however high quality, often sells at commodity prices, leaving little room for investment back into their farms.
Emerging regulations like the EU Deforestation Regulation (EUDR) require geolocation data, land use history, and detailed due diligence documentation, information that many smallholders have never been asked to collect. Instead of being recognized for their sustainable practices, they face a new barrier: paperwork and technical standards designed for larger enterprises.
Access to credit, insurance, and modern inputs remains a persistent gap. Without affordable capital, smallholders can’t invest in irrigation, storage, or quality seeds, leaving them vulnerable to climate shocks and price volatility. According to the World Bank, more than 70% of smallholders in developing regions lack access to formal financing, locking them into low productivity cycles.
These challenges aren’t just farmer issues—they’re systemic bottlenecks in global sustainability. Smallholders already farm with low inputs and traditional knowledge, but they’re being asked to jump compliance hurdles without the infrastructure larger players enjoy. The opportunity isn’t just to help them catch up—it’s to empower them as innovators who can set the benchmark for sustainable, traceable farming.
Modern sustainable sourcing and traceability platforms are transforming how smallholder farmers and their buyers meet regulatory and market demands. Instead of relying on fragmented records and manual reporting, these platforms create a digital ecosystem that connects farms to global supply chains with accuracy and transparency.
Mobile apps and field ready tools allow farmers to record crops, inputs, and yields on the spot—even in remote areas. This creates reliable, UpToDate farm profiles that buyers can trust.
AI-powered features handle the heavy lifting for regulations like the EU Deforestation Regulation (EUDR). From mapping farm boundaries with geospatial data to automatically preparing Due Diligence Statements (DDS), these platforms remove the documentation burden from farmers and intermediaries.
Verified supply chain data gives exporters and brands the confidence to source from smallholders, often unlocking premium markets or certifications. Trust built on data translates into better contracts and more stable incomes.
This is how technology doesn’t just bridge the gap—it builds a stronger, more sustainable supply chain.
Discover how TraceX empowered KMIT farmers to digitize operations, ensure traceability, and achieve true sustainability in the maize supply chain—from farm management to market access.
TraceX brings these capabilities together. By integrating geospatial mapping, AIdriven compliance tools, and open APIs, TraceX simplifies EUDR compliance for exporters while empowering smallholder farmers to meet global standards—without adding layers of complexity.
TraceX gives farmers and field agents easy-to-use mobile tools to record everything from crop cycles to input usage and yields. This creates accurate, digital farm profiles—even for remote smallholders who previously relied on paper records. It ensures that exporters and cooperatives have real-time visibility into what’s grown, where, and how, which is critical for meeting sustainability benchmarks.
TraceX integrates geospatial mapping and AI validation to pinpoint farm boundaries and link them to production data.
This directly supports EUDR compliance, providing plot-level coordinates, risk assessments, and ready-to-file Due Diligence Statements (DDS) for EU TRACES. By automating polygon checks and data quality validation, TraceX removes the manual burden from both farmers and compliance teams.
TraceX’s verified supply chain data builds a digital chain of custody from farm to export.
Buyers gain confidence that products are deforestation-free, legally sourced, and certified, enabling them to pay premium prices or enter new markets.
Farmers benefit because TraceX empowers them to meet global sustainability standards, turning compliance into a competitive advantage rather than a barrier.
TraceX goes beyond compliance and data capture—it actively promotes financial inclusion for smallholder farmers.
Digital records build credibility: By capturing verified farm data, yields, and input usage, TraceX helps farmers establish a digital footprint that lenders and microfinance institutions can trust. This makes it easier for them to access credit, insurance, and input financing, which were previously out of reach due to lack of documentation.
Market linked incentives: With verified traceability and proof of sustainable practices, farmers gain access to premium buyers and certifications, which can lead to better prices and more stable income streams—driving long-term inclusion in global trade.
See how TraceX streamlined farmer financial settlements for a global leaf tobacco giant, delivering faster payouts, improved transparency, and stronger farmer trust.
TraceX’s combination of farm management, traceability, and sustainable sourcing solutions doesn’t just help businesses meet regulations—it actively empowers smallholders, reduces compliance risk, and opens doors to responsible global trade.
Your role isn’t just to comply—it’s to lead. Buyers, brands, and policy makers that act today to support verified traceability, empower smallholders, and integrate intelligent compliance systems will define the future of sustainable food systems.
Smallholder farmers are not just participants in agriculture—they are the foundation of resilient, sustainable food systems. By supporting them with the right tools, financing, and market access, we can unlock their full potential to drive food security, preserve biodiversity, and build climate resilient supply chains. When empowered through platforms like TraceX, these farmers gain the digital visibility and compliance readiness needed to thrive in global markets—ensuring sustainability is not just a goal, but a reality.
Build a smarter, greener supply chain today.
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Sustainable food supply chains,
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How to achieve EUDR and smallholder compliance with confidence.
They produce over one-third of the world’s food, maintain biodiversity through diverse cropping, and use regenerative practices that build climate resilience.
They struggle with limited market access, complex compliance requirements, and a lack of finance or resources to invest in better practices.
Digital platforms like TraceX provide farm management tools, traceability data, and compliance automation, helping them access markets and meet regulations such as EUDR.
