SUNFLOWER SUB SECTOR/VALUE CHAIN ANALYSIS TANGA REGION VALIDATION WORKSHOP TANGA 25 TH JUNE 2009

Similar documents
VALUE CHAIN ANALYSIS OF SUNFLOWER FOR THE REGIONS OF MOROGORO, IRINGA, MBEYA AND RUKWA

Cotton and Cotton By-products Country Survey Report for Tanzania November, 2017

Neil Balchin, Josaphat Kweka and Maximiliano Mendez-Parra Honest Mseri, ANSAF

Regional industrialisation and the development of agro-processing value chains in Tanzania and South Africa: Oilseeds-to-edible oils

Industrialization and Edible Oils MUNA NGENDA PROJECT MANAGER, DALBERG

ETHIOPIA BUSINESS DAYS WORKSHOP: OILSEEDS 5 TH NOVEMBER

Example from Poultry Sector in Mozambique

SUNFLOWER SUBSECTOR COLLABORATION BETWEEN SUNFLOWER OIL PROCESSORS AND RLDC FOR IMPROVED SUNFLOWER SECTOR IN TANZANIA

The Role of Quality Seed in Promoting Integrated Soil Fertility Management (ISFM): The case of maize

RURAL LIVELIHOOD DEVELOPMENT PROGRAMME (RLDP)

Future bright for sunflower producers

Centre International de Recherche et de Développement

AGRI-HUB TANZANIA ANNUAL PLAN February 2013

UNITED REPUBLIC OF TANZANIA MINISTRY OF WATER AND IRRIGATION (MoWI) NATIONAL IRRIGATION COMMISSION (NIC) KILIMANJARO ZONE

National Rice Development Strategy (NRDS) Proposed Template

Workshop on Cost Effective Aflatoxin Risk Reduction Strategies in Maize Value Chain 26 th to 30 th March ACDI/VOCA Activities under KMDP

Zimbabwe ANNUAL REPORT

Sunflower Value Chain Development in Tanzania: The case of SHADECO in Village Based Contract Farming Arrangement in Iringa Region -Tanzania

Session 3: Questionnaire on Policy, Laws and Regulations and National Policy Dialogue Plan

Agribusiness Approaches to meeting the protein demands of the urban and Rural Populations. By Amos Manyara Farming Systems Kenya

Soya Ni Pesa. Steady progress in building the soybean sector in Tanzania. Meet Mr. Nyigu Melkiard

Rice millers drive productivity and capacity in smallholder rice farming in Lao PDR

Estimated Budget (USD) of Concept Notes:

Dear Ladies and GentleMan, His Excellency Mr President, We thank you very much for giving us the opportunity to give this presentation to you on behal

Diversifying sources of farmer income and transformation of cotton growing zones in eastern Senegal

Unlocking the potential of private seed companies to commercialize beans seed in Tanzania: Experiences from bean seed system project.

COTTON DEVELOPMENT AUTHORITY

Women s economic leadership in agricultural markets

Umm e Zia. July Women Economic Empowerment through Small Scale Food Processing. Project Proposal 30 July 2009

GCP/RAF/448/EC STRENGTHENING LINKAGES BETWEEN SMALL ACTORS AND BUYERS IN THE ROOTS AND TUBERS SECTOR IN AFRICA PROJECT IMPLEMENTATION PLAN GHANA

Alternative and Innovative Financing in the Agricultural Sector in Nigeria A case study of the OLAM Nigeria Ltd (PPP)

Jane Carter CONTRACT FARMING IN TANZANIA S CENTRAL CORRIDOR. Lessons from the Rural Livelihood Development Programme Tanzania

Planning and Developing Community Micro-Enterprise

Agricultural Outlook Forum 2003 Presented: Thursday, February 20, 2003 THE FUTURE OF UKRAINE S GRAIN SECTOR

Farmers in the southwestern highlands of Uganda and neighbouring Rwanda

Sustainability of the Malawi Farm Input Subsidy Programme

COTTON PRODUCTION AND RESEARCH IN ETHIOPIAN

Strategic Options for Edible Oil Industry Development: Case of Sunflower sub-sector. 3 rd Annual Policy Conference March 02, 2017

Agri Trends 05 March 2018

THE INTER-SESSIONAL PANEL OF THE UNITED NATIONS COMMISSION ON SCIENCE AND TECHNOLOGY FOR DEVELOPMENT December 2010 Geneva UGANDA CONTRIBUTION

Summary of major findings.

India s Edible Oil Demand & Supply Situation

Reaching Smallholder Farmers in Africa with Appropriate Agricultural Technologies, the African Agricultural Technology Foundation (AATF) experience.

Central Kalimantan s Oil Palm Value Chain: Opportunities for Productivity, Profitability & Sustainability Gains


Agricultural Mechanization in Cambodia

A Successful Extension Model with Smallholder Farmers A Side Event at the 2015 World Food Prize/Borlaug Dialogue

USDA WASDE Report. Friday April 9 th 2010 World AG Supply & Demand Estimates. Office Friday April 09, 2010

Soy Canada SOYBEAN PROCESSING WORKSHOP PRESENTATION NOVEMBER 16, 2017 BRANDON, MANITOBA

Value Chain and Entrepreneurship Development : Purushotham R. B.Sc(Agri) MBA (Tech Mgmt)

AGRIBUSINESS VALUE CHAIN APPROACH FOR AFRICAN YOUTH EMPLOYMENT CREATION

2018/19 Soybean Market Outlook & Strategies

Seed Value Chain Analysis

Executive Summary: Market Analysis of Potato Value Chain in 3 target countries of East Africa. April 26, 2016

WEATHER RISK INSURANCE FOR SMALL FARMERS IN MALAWI

COLLECTIVE MARKETING: MAKING MAIZE A PROFITABLE PRODUCT IN TANZANIA

FROM SEED TO SHELF VALUE CHAIN DYNAMICS IN KENYAN HORTICULTURE. David Knopp Emerging Markets Group, Ltd. 10/5/05

VIABLE EXTENSION APPROACH TO PROMOTE RURAL ECONOMIC EMPOWERMENT

Central Kalimantan s Oil Palm Value Chain

A paper presented at the Stakeholders Dialogue Forum on Kilimo Kwanza (Agriculture First), Held at Isamilo Conference Centre, Mwanza, on 4 th August,

lndonesian Palm Oil lndustry: Challenges and Prospects

POLICIES AND INSTITUTIONS FOR PROMOTING NERICA RICE COMPETITIVENESS IN SUB-SAHARAN AFRICA

China as a market for Latin American dairy and beef : a supply and demand outlook with a food security perspective

Bashaier Egypt s M-Agriculture Channel

Proposal to assist farmers in getting reasonable price of paddy discussed

agriculture, forestry & fisheries Department: Agriculture, Forestry and Fisheries REPUBLIC OF SOUTH AFRICA

Session 5. Fertilizer Policy Toolkit an Interactive Policy Tool

JICA TRAINING FOR CARD-CAADP INTEGRATION SUCCESSFUL EXPERIENCES OF RESOURCE MOBILIZATION IN GHANA AUGUST, 2015

Analysis of the Value Chain for Root and Tuber Crops in Malawi: The Case of Cassava Joseph S. Kanyamuka, Joseph K. Dzanja and Flora J.

AGRICULTURE IN BANGLADESH A NOTE ON FOOD SECURITY BY ENHANCING PRODUCTIVITY

Sustainable spice trade

ACRE Africa s Contribution to Climate Risk Management. Adaptation of African Agriculture Marrakech 2016

Cambodia Perspective on Rice Production and Mechanization in Cambodia The Regional Seminar on Rice Production & Mechanization

Improving Mechanization for African Smallholder Farmers Part one of a three part webinar series

FACILITATING SMALLHOLDER FARMERS MARKET ACCESS IN THE OIC MEMBER COUNTRY SUDAN PRESENTAION

Presentation outline

Checklist for Agricultural Engineering Sector (Policy) Anglophone Group

Economics of Organic Farming over Conventional Farming- A Case Study in Karnataka, India

Financial Tools for the Promotion of Biofuels

IMPACTING JOBS THROUGH INCREASING EXPORTS:

CEDO SEEDS.

Production Income and Employment

Warehouse Receipt System

Pigeonpea in ESA: A story of two decades. Said Silim

CHAPTER 4 DATA COLLECTION AND ANALYSIS

10 Million Acres of Opportunity. Planning for a decade of sustainable growth and innovation in the Canadian soybean industry

Emerging Sustainable Commodity Value Chains in Asia. Ms. Lakshmi Venkatachalam Vice President (Private Sector and Cofinancing Operations) Outline

Agro-dealers in Zimbabwe: Scaling input provision as key for successful small farmer engagement

Key Messages for Annual Review Implementation of Selected Key Messages. Summary of the Medium term Reform Agenda

Policy Brief # 3 July 2016

Roles of Private and Public. Agricultural Mechanization. Strategies (AMS) sector

CASSAVA MECHANIZATION PROSPECTS AND FUTURE MARKET POTENTIALS IN NIGERIA. Suleiman, A.A. Bashiru, L Iheikhena, O.W.

Corn & Soybeans. Corn (source WASDE) Soybeans (source WASDE)

J.C. ONYANGO, CLIMATE CHANGE, ECOLOGICAL INTERACTIONS, LAND USE MANAGEMENT, AND SOCIAL IMPACTS AT CREATE SEMINAR ON 19 TH FEBRUARY 2014 RICE OVERVIEWS

Banks Make Supply Chain Financing Work. Michael Andrade

Terms of Reference for Sugarcane Coordinator

Olam International. August Important instruction: Place an image in exactly the same position as this grey box.

Mozambique s Natural Resource Boom. What potential impacts on the competitiveness of Mozambique s Cotton industry?

Market access for women producing Karité Butter in Mali

International Grains Summit

Transcription:

SUNFLOWER SUB SECTOR/VALUE CHAIN ANALYSIS TANGA REGION VALIDATION WORKSHOP TANGA 25 TH JUNE 2009 1

Outline of the presentation Background Sunflower subsector overview Sub Sector Map & Dynamics Opportunities, constraints, and viable solutions Driving forces Value chain, subsector business development model Proposed subsector development interventions 2

Background to the study Commissioned by SIDO under Rural Business Support Services (RBSS) Sub Component of MUVI Program The study was conducted by MMA The primary objective is to enhance a clear understanding of the sub sector to enable programming of strategic interventions under the MUVI RBSS Program 3

Specific Objectives of the study Specific objective of the study are; Undertake market analysis of sunflower (global, regional & national) and assess critical success factors for the market Analyse sub sector product flow, value addition and information flow Analyse sunflower sub sector and value chain actors, roles & interrelationships Analyse factors affecting the growth and competitiveness (constraints & opportunities) of the various supply channels 4

Specific Objectives of the study Analyse value chain governance, horizontal and vertical integration and impact on RMSMEs Identify potential business solutions (value chain upgrading strategies) that will address constraints and tap the opportunities Identify potential for public and private partnerships in developing the value chains 5

Specific Objectives of the study Offer a set of recommendations based on the value chain analysis specifically: Highlighting specific constraints analyses of the recommended value chains to be supported Organisational and value chains support activities Investment proposal 6

Methodology Steps included: Review of literature Interviews and focused group discussions with representatives of the entire value chain actors Analysis Validation Final reporting 7

Global perspective of Sunflower sub sector Major oil seed crops include Copra, Cotton (cotton seed), palm, groundnuts (peanut), rape (rape seed), Soybean and sunflower. World production of oil crops stands at over 385 million metric tons. The world s demand for oils and fats has doubled for the last 15 years and is projected to reach 217 million metric tons by year 2030. Crude palm oil and soy oil currently account for almost 50% of the global demand of the crops. 8

Global perspective of Sunflower sub sector FAO projects the oil seed industry to maintain growth pace among the major agricultural sectors up to 2010. The global consumption of edible oil is forecasted to grow at 2.5% annually between 1999-2010. Globally exports are projected to grow by about 15 million metric tones by 1020. Brazil and Argentina (Soy oil) and Malaysia and Indonesia (Palm Oil) will increase their share. 9

Global perspective of Sunflower sub sector Sunflower oil world trade has been stable in the last five production years. However, Argentina is still holding a leading position. The volume traded in 2003 reached 3.4 million tons for US$ 1,583 million. Argentina (30%), Ukraine (27%) and The Netherlands (10%) are the main exporters. 10

Sunflower subsector in Tanzania Sunflower production is growing and locally produced sunflower oil is contributing to about 40% of the national cooking oil requirement. With minor sunflower producing regions (e.g. Tanga, Kagera) taking up production, local production is expected to grow further. Sun flower production is a profitable venture at the farmer level with a gross margin of up 60% earned by a farmer. The farm gate prices in many parts of Tanzania fluctuate between TShs 18,000 to TShs 30,000 per 60-65 kg bag (TShs 200-500/kg). 11

Sunflower subsector in Tanzania Tanzania edible oil demand is estimated to be 18,000 tonnes per month. The industry needs 250,000 tonnes a year of edible oil. Domestic production of seeds can not meet the demand of seeds for processing. Sunflower has also been designated as a potential crop for the bio fuel initiative of the Government of Tanzania. 12

Sunflower subsector in Tanga Production Sunflower can be grown in almost all parts of Tanga region using different varieties for different agro-ecological zones. Currently sunflower is grown in the districts of Handeni, Kilindi, Korogwe, Pangani and Muheza with potential in Mkinga, Lushoto and Tanga Production is predominantly by small holder farmers in small acreages of 2-4 acres and maximum 5 acres 13

Sunflower subsector in Tanga It can be estimated a total of 12,000 acres was cultivated in 2008 production period (Handeni about 8000; and 4000) shared between the other districts. Total production of sunflower in 2008 can be estimated at about 6,000 metric tons (Handeni 4,000 mt) Sunflower yield is 520 kilos/acre (8 bags of 65kgs/acre). Limited trade between the region and the rest of the country - limited by small volumes produced 14

Sunflower subsector in Tanga Inputs/Seeds In Handeni, the district council stocks seeds for farmers at a subsidised price (TShs 2,500). Private stockists (agro dealers) of seeds also operate in Handeni and Korogwe. Farmers own seeds are also used. Church based organisations e.g. Passionists Fathers stock seeds for farmers in the surrounding area Pannar seed varieties costs up to TShs 6,000/kg 15

Sunflower subsector in Tanga Processing Total installed capacity for processing is about 52.5 mt/day Currently 8 motorized SME processing installations of Chinese and TEMDO Technologies; Handeni (3); Muheza (1), Tanga (2), Korogwe (1) Pangani (1) ; combined capacity of 12.5 mt/day 16

Sunflower subsector in Tanga Processing 1 medium scale processor in Tanga Town with installed capacity of 20 metric tons a day Hand/mechanical oil press are also available Actual quantities processed is about 6 metric tons/day and only during the production period 17

Focus of study Subsector Definition: Sunflower edible oil for local markets 18

Sunflower Sub sector map 19

Subsector support actors and functions Tanga Regional, Districts and local authorities Confederation of Tanzania Industries (CTI) World Vision Tanzania- Agriculture Sector Development program Tanzania Chambers of Commerce, Industry and Agriculture (TCCIA) The Centre for Agricultural Mechanization and Rural Technology (CAMARTEC) Tanzanian Engineering and Manufacturing Design Organisation (TEMDO) Private sector investments 20

Profitability Analysis Profitability comparison for current and best practices 21

Profitability Analysis Farmers can still increase profitability up to a gross margin of 68% using best farming practices. Production When a farmer sells sunflower seeds = 60% When a farmer sells sunflower oil and seed cake = 75% When a farmer is leaving seed cake with the processor = 64% 22

Processing Profitability Analysis Profitability when a processor buys sunflower seeds, mills and sell oil and seed cake = 39% 23

Tanga region sunflower Sub Sector Dynamics Constraints and opportunities Input supply Lack of /scarcity of improved/quality seeds Limited knowledge of the private dealers on what variety suitable for which agro ecological zone Business opportunity for private sector investment in seed supply Opportunity for community seed production and multiplication 24

Tanga region sunflower Sub Sector Dynamics Constraints and opportunities Production and farm management Sunflower diseases and pests Inadequate knowledge of best agronomic practices Small acreages for growing sun flower Rain fed farming practices resulting to low yield Private sector trainings in proper agronomic practices Increased production resulting from increased acreages cultivated Private sector investment on weather insurance 25

Tanga region sunflower Sub Sector Dynamics Constraints and opportunities Farmer organization Few farmer organisations in Tanga Weak organisations of farmers unable to undertake group marketing Low literacy and weak management of farmer groups Presence of institutions with mandate and willing to facilitate strengthening of farmer groups 26

Tanga region sunflower Sub Sector Dynamics Constraints and opportunities Processing Low efficiencies of manual/non motorised processing machines Processing skills are lacking mainly among small holder processors Presence of installed equipments for SME processing Presence of suppliers of processing machines who are willing to give after sale services 27

Tanga region sunflower Sub Sector Dynamics Constraints and opportunities Marketing Small volumes and no bulking limits market access Stiff competition between sunflower oil and imported edible oil High demand for sunflower oil due to health reasons The opportunity to increase domestic production and substitute imports for edible oil Models for Farmer Organisations for group marketing exists 28

Tanga region sunflower Sub Sector Dynamics Constraints and opportunities Finance Limited accessibility of financial services for small scale sunflower agricultural enterprises/ farmers Limited financing mechanisms for large scale investment in rain fed sunflower farming Presence of savings and credit cooperative society initiatives to mobilize group finance Financing opportunities available through contract farming 29

Viable business solutions 1. Quality Sunflower Seeds; (a) Community seed production and multiplication (QDS). Estimated demand for seeds: 33.5 metric tons of quality seeds Potential suppliers: TOSCI, ASA; Private companies 30

Viable business solutions 2. Training in basic agronomy, disease control and pest management Estimated Demand: 120,294 Farmers in Handeni currently growing sunflower and more from other districts Potential suppliers: SUA, TOSCI, ASA; private firms 3. Institutional strengthening of farmer s groups and associations Estimated Demand: About 3 farmer clusters in Korogwe, and 2 in Muheza and 6 in Handeni and others in Pangani and Kilindi Potential Supplier: FAIDA Mali, RUDI 31

Viable business solutions 4. Training of SME processors in sunflower processing, entrepreneurship and business management Estimated Demand: 3 farmer clusters (1 in Mashewa and 2 in Handeni Kabuku and Misima) Potential suppliers: TEMDO; private firms 5. Market information provision Estimated Demand: About 3 farmer clusters in Korogwe, and 2 in Muheza and 6 in Handeni and others in Pangani and Kilindi Potential Supplier: Communication and knowledge management strategy for rural business (MUVI component 32

Viable business solutions 6. Financing for sunflower production and processing Estimated demand: More than 120,294 Farmers Potential supplier: PASS, Through contract farming arrangement 33

Sunflower sub sector driving forces Macro economic issues (exchange rates) affect import and export trade of crude oil and sunflower seeds. The zero tariff rates for the East African block Price of SME processed sunflower oil compared to imported oil (1300/liter VS ) A growing local market for sunflower oil Importation of crude palm oil still remains a big driving force Removal of import tariff of 10% in 2009-2010 budget 34

Subsector or Value chain? We identify value chains by looking at key element of a value chain 1. Sharing of economic gains 2. Governance 3. Market focussed collaborations 35

Subsector or Value chain? 1. Economic gains are concerned with the generation and distribution of returns arising from the various functions, e.g. design 2. Governance ensures that interactions between firms exhibit organisation rather than being random 3. Market focused collaboration - different business enterprises work together to produce and market products which meet the needs of a targeted consumer Conclusion: sub sector is at an infant stage of development; no evident of emerging value chain 36

What next? Proposed value chain for development Business Module for the sub sector development Proposed sub sector development interventions 37

Proposed Value Chain 38

SS development Business Module 39

Strategic interventions 1. Promotion of sunflower commercialization in Tanga region Facilitate farmer mobilisation and training in best agronomic practices for sunflower Lobby for sunflower sub sector development to be taken up and promoted in the development agenda of the regional government Identify missing link in demand and supply of critical services Make available to private sector information on investment opportunities in the sub sector. Enhance marketing and a market linkage for sunflower seeds Promotion of a sunflower SS Development Platform in Tanga 40 and link with national forums.

Strategic interventions 2. Development of a comprehensive contract farming business module Develop contract farming modalities between farmer organisations with processors (small, medium and large scale). Assessment of critical services, their providers and their availability Promote private sector service providers to work in the sector 41

Strategic interventions 3. Making seeds readily available and affordable to farmers Initiate a community based seed multiplication approach to seed production (learning from best practices) Engage and certify progressive farmers to produce and multiply seeds Train farmers and extension personnel in seed production Support seed certification at farmer level Encourage private sector seed suppliers to supply seeds in the region. 42

Strategic interventions 4. Enhance availability of financial services Identifying a financial service provider to provide services within the integrated framework of the contract farming module Design a package through which farmers can access credit and later pay for it as a deduction from sale of their outputs 43

Strategic interventions 5. Develop weather crop insurance module to be piloted in the sub sector. Developing the module bearing in mind its application in the crop specific context Testing the module and its application Setting up a framework and structures for its application 44

Strategic interventions 6. Research and develop small and medium scale processing technologies. Research and develop cost effective small and medium processing technologies Identify local entrepreneurs to pilot identified technologies Review and disseminate the improved technologies 45

46