Sesame Business Network in Northwest Ethiopia. Mykadra action plan Mykadra, Ethiopia

Transcription

1 Sesame Business Network in Northwest Ethiopia Mykadra action plan Mykadra, Ethiopia 1

2 Information sheet Name SBC Mykadra Region Tigray Woreda Kafta- Humera Date of action planning 06/07/2013 SBN coaches facilitating action planning Names Muez Berhe Kahsu Kelali Aregawi Gebreslasie Gezu Seyoum SBN function SBN Support Program Team Coordinator, Humera SBC Agronomist, Humera SBC Extension and Communication, Humera SBC Value chain and agro-business development expert, Humera SBC actors participating in action planning Name Organization / actor group Function Phone number Birhane Gebremedhin Private/ Fana cooperatives Farmer Guash Gebreslasie Private Farmer Abiy Merasa Fana-limat cooperative Casher Tesfay Areki Fana-limat cooperativve Board member Teka Tesfay Fana-limat cooperative Accountant Gebremeskel Dagnew WoA Extension staff Birhane Asefa Fana-limat Cooperative Vice chairperson Birhane Hailay Kebele Adminstration Chairperson Birhanu Kahsay Dedebit credit & saving institute Manager

3 About action planning Action planning Through one day participatory action planning in June 2013, SBC actors have formulated the economic objectives, strategies, action and activities ir SBC, covering the period. The action plan, which succeeds the SBC baselines of March/April 2013, assessed the current situation of SBCs. The action plan will lead to the formulation of support activities by the Sesame Business Network Support Program for This action planning report is structured as follows: 1. Formulation of economic objectives o Objectives and change (table 1.1) o Specific objectives of stakeholders (table 1.2) o Stakeholder relations (table 1.3) 2. Strategy and action (table 2.1) 3. Objectives o Improving sesame productivity (table 3.1) o Cost price reduction (table 3.2), o Interest rate reduction (table 3.3) o Post-harvest losses reduction (table 3.4) o Entering into higher value markets (table 3.5) Introduction Mykadra cluster is located in Kafta Humera woreda, western zone, Tigray region. The cluster consists of different stakeholders such as small scale farmers, large scale farmers, traders, input suppliers, financial intuitions, research and office of agriculture. Mykadra is located 28 km far from (in the west direction) Setit-Humera town. It is also 33 km far from Lugudi border in Sudan. The total are of the Woreda is 160,000; out of which 100,000 is cultivated. From this, in 2012, about 63 percent was cultivated for sesame while the remaining 37 percent was covered by crops like sorghum, cotton and others. There are about 18 thousands inhabitants whose livelihood largely depends on sesame production and other rural income generating activities. The area is endowed with some vegetations and small rivers which is suitable for irrigation. Pertaining to infrastructure, Mykadra has shown some encouraging developments. For example, electric power is under construction in the area, all weather asphalt road and air transportation is also available. It has access to the main road which connects Humera to Port Sudan. Telephone access is available though there is lack of full mobile network in some localities. The cluster has four cooperatives with potential members supplying sesame to Setit Humera Union and Selit Hulling Company. All cooperatives have their own stores which can hold 10,000 quintals but the stores do not seem to be up to the standard. There are also about 52 stores that are owned by active traders. What is more, almost all the investors do have farm storages. There is no processing machine in the cluster but there has been a progressive effort by Selet Hulling PLC to install one. 3

4 Interest rate In an attempt to resolve the various challenges that have been observed in the sesame production and marketing, representatives from Mykadra kebeles, office of agriculture, cooperative leaders, cooperative staffs, traders, farmers and administrators came together and developed this action plan. In the action planning primary economic objectives were formulated, strategy developed and actions were selected giving due attention to the major challenges of the sesame sector in Mykadra cluster. The following part presents details of the action plan. 1. Economic objectives To double productivity of sesame (from 3.5 to 7 quintal/ha) at 2015 and produce the highest quality sesame (grade 1). Table 1.1 formulations of objectives and change Subjects Current situation (early 2013) Objectives (end 2015) Sesame acreage (ha) 63,000 70, Acreage other crops (ha) 37,000 30, Total acreage (ha) Sesame productivity (quintals/ha) Sesame production (quintals) Cost price per hectare (ETB) Cost price per quintal (ETB) Production &productivity of most important other crops (qt/ha) % change Observations/remarks ( reasons for change) - Price increase in sesame - Demand in the international market - Economic benefit compared to other crops( it can easily converted to cash) - Price reduction of sorghum and cotton - Increasing the price of sesame - Pest ( Striga in sorghum) - Proper controlling of pest and diseases - Improved agricultural practice - Extension and training - Using full agricultural package - Improving access to finance Cost price/ha increases Sorghum15 Cotton Decreases due to increase in productivity - Use of improved agricultural practices - Use family labour & labour DECSI 15 % 15% 0 - Improving the saving culture of farmers Bank % % 0 - Organizing SACCOs Cooperatives 15% 12% 20 - awareness creation among traders, Informal money lender - Shell - In money/cash 10%/month %/month 5% 50 producers, cooperatives and unions on financial - Expanding the Credit access by legal loan providers - Arranging collateral system - Increasing loan amount based on the need of beneficiaries Post-harvest losses (% of reduction) 30% 9% 70 - On time harvesting, stacking and threshing - Creating access to credit - Using quality sacks - Proper setting of Hilla 4

5 Market channels Storage facilities 4 stores very traditional & poorly constructed - Fana- limat coop has a plan to construct store that can hold 3000 to 4000 MT Storage practices traders Cooperative Store at home have their own stores Grading Grade 2 Price Grade 1. Grade 2. No price difference Farmers -Selit hulling-export Farmers- cooperatives/ union direct export Farmers- traders -via ECX to export market Use of standard storing practice Improve 60% to grade 1 High price (>3600/qt) Farmers- tocoops- tounion -to direct export Cleaning No plan Processing No plan End market (international buyer) union directly export union directly export to Europe, Japan, others % - using a store which is free from any chemicals - providing storage service to member - using stores free of chemicals - Training on quality, - Certification of product - Providing grading instrument at cooperative and spot market level - Creating strong linkage with buyers - Providing good price for quality seed - Giving recognition & reward for quality - There will be dividend from cooperatives and unions - Strengthening financial capacity of unions and cooperatives - Increasing membership - Contract farming and traceability implementation - Strong linkage with foreign buyers - Providing marketing information 5

6 Table 1.2 specific objectives of stakeholders Actors / stakeholders in SBC Producers / cooperatives Local traders Present in action planning (/no) Motivation of this actor for participation in SBC to improve quality and productivity; to get financial, marketing linkage & experience to supply quality sesame and increase the quantity Specific objectives of this actor for end 2015 Strengthen of producers & coop, to access credit and high value market to improve the quality of sesame Observations/ remarks Limitation in knowledge of agronomic practice and market of the production Poor quality and mixture of foreign matter Banks / MFIs Input suppliers Research financial support to sesame sector; understanding the current statues of stakeholders; awareness creation on saving and loan repayment provide input sector; to sale input on fair price to develop improved seed verities; to improve pest to provide credit and increase loan amount; to create awareness on financial, loan repayment and credit to sell quality input on time with reasonable price to provide improved seed and produce quality production Farmers did not get collateral based credit; Group collateral is very problematic limited amount and poor quality input limited improved agronomic practice Extension Woreda / kebele adminstration to improve production and productivity of sesame to assist stakeholders in the Sesame Business Network to increase productivity of sesame 159% to facilitate and support the sesame sector shortage of qualified staff and weak support poor support and linkage in the stakeholders Table 1.3 Stakeholder relations Desired Observations: Stakeholder relations Current score score (Why is it important? How to improve relations? (scores 0-3) (end Subjects should be improved/collaboration be 2015) developed? Farmers with traders 1 3 creating healthy relation and mutual benefit Farmers with extension staff 3 3 improving technical support Farmers with banks 1 3 increase credit access and loan amount Farmers with micro-finance 3 3 increase credit access and loan amount institutions (MFIs) Farmers with informal money lenders 2 0 developing contract farming, saving culture and cooperative capitalization Cooperative(s) with the union 3 3 full supply of input and product Cooperative(s) with bank(s) 2 3 increase credit access and loan amount Cooperative(s) with MFIs 2 3 to increase and revise the collateral system Cooperative(s) with processors 3 3 to increase quality and add value Cooperative(s) with service providers 3 3 to improve the service 6

7 2. Strategy and actions Table 2.1. Strategy and actions Objective Challenges to address Actions to undertake Sesame productivity improvement To increase productivity from current 3.5 quintals/ha to 7 quintals/ha by December 2015 Cost price reduction To reduce the cost price by 50% per quintal by the end of December 2015 Interest rate reduction To reduce interest rate of informal money lenders by 50% by the end of December 2015 Post-harvest loss reduction To reduction post-harvest loss from current 30% to 9% by the end of December 2015 Value addition Higher-value markets Lack of Improved seed Poor pest Lack of agricultural machinery and equipment Climate change Lack of finance for input Poor labour Inefficient use of family labour Low agricultural practice and input Poor credit access and low amount of loan Poor saving culture of stakeholders Weak PCs and SACCOs Poor harvesting and threshing Lack of quality storage Poor storage practice Knowledge gap Poor linkage with foreign processors Low traceability and certification Lack of knowledge on marketing information Improving seed availability Practicing intergraded pest Improve the availability of agricultural machinery and equipment Practicing natural resources conservation technologies Lobbying banks and MFIs Improving labour Employing family labour efficiently Improving the use of modern technology Lobbying financial institutions to reduce interest rate and increase loan amount Improving saving culture Strengthening PCs and SACCOs Improving harvesting and threshing practice Constructing standard storages Improving storage Creating awareness on value addition Establishing contract farming Creating traceability and certification Creating communication linkage on high value market; Contract farming and traceability 7

8 3. Operational plan Table 3.1. Objective: sesame productivity improvement Improving seed availability Practicing integrated pest Improving availability of machinery & equipment Practicing natural resources conservation Lobbying banks and MFIs WHAT ACTVITIES? Distribution of improved seed Linking with seed multiplying company Training for selected seed multiplier farmers Training on integrated pests Applying improved pest practice informing farmers to use permissible chemicals Provision of machinery and equipment on rent base Demonstration ( fertilizer distributer, row planter etc) Training on rehabilitation of degraded natural resource or climate change Giving credit access and increase amount of loan Improving creating collateral loan system Training on loan repayment and credit HuARC, Coops, Union & OA HuARC, OA SBN HuARC, OA SBN HuARC, SBN and WoA resource s (cash/ki nd) Mykadra 10,000 30, Humera 10,000 35, Mykadra 30, Mykadra 40,000 Farmers Mykadra Coops,OA, Selit hulling, SBN Selit hulling & Hiwot mechani Selit hulling, Hiwot mechan, SBN, others HuARC, WoA CBE, private bank MFIs CBE, private bank, MFIs July 2013 July Mykadra Own capital 120, ,000 Mykadra 120, , Mykadra 80, Humera 50, Mykadra Own capital Mykadra 20,000 Banks, MFIs Mykadra 40,000 8

9 Table 3.2. Objective: cost-price reduction Employing family labour efficiently Improving labour Improving the use of modern technology WHAT ACTVITIES? Awareness creation on use of family labour Making agreement Improve services (mobile health centre, water e, shelter Demonstration on different modern agricultural technologies SBN, OA and coops, union labour & social affair office Woreda health office, labour and social affair office HuARC, SBN, OA & selit Hulling co. resourc es (cash/k ind) Mykadra 20, Mykadra own capital Mykadra 50, Mykadra 30,000 Table 3.3. Objective: interest rate reduction Lobbying financial institutions on reduction of interest rate and increase loan amount Improving saving culture Strengthening PCs and SACCOs WHAT ACTVITIES? Meeting/workshop with loan providing institutions Training on loan repayment Training on saving culture Capacitating cooperatives Organizing SACCOs Training on financial MFIs, banks, SBN SBN, WoCP and union SBN, WoCP and union resourc es (cash/k ind) Mykadra 20, National 40, Humera 30,000 Members Mykadra SBN, WoCP, other Stakeholders SBN, WOCP and union Own capital Mykadra 30, Mykadra

10 Table 3.4. Objective: post-harvest losses reduction Improving storage system Improving storage WHAT ACTVITIES? constructing modern stores Training, & visit Coop, traders and union OA, SBN, coops union resources (cash/kind ) Mykadra 2,000,000 3,000, Humera 60,000 Table 3.5. Objective: value-addition Establishing contract farming Creating traceability & certification Creating awareness on value addition WHAT ACTVITIES? Making agreement with foreign company Branding Mykadra sesame Training & visit resources (cash/kind ) SBN, OA, Mykadra 10,000 20,000 SBN, OA Mykadra 30, ,000 SBN, coops, union OA Starting sep 2013 Gonder, A.Ababa - 150,000 Table 3.6. Objective: higher-value markets Creating linkage with high value market Contract farming and traceability WHAT ACTVITIES? Training on market information Searching & linking with new markets Linkage & facilitation (workshop, meeting) Making contract farming agreement SBN, OA,selit hulling union SBN, OA, HuARC SBN, OA,selit hulling union SBN, Selit hulling union resources (cash/kind) Humera Humera 40, National level Humera 20,000 10