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Value
Chain Development in Mango and Highland Fruits production
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Recently two new Value Chain Development
interventions have been started as part of the SNV-BOAM programme
financed by the Embassy of the Republic of Ireland and primarily
undertaken by the team based in the SNV - Southern Portfolio (Awassa):
Mango and Highland Fruits production and
processing
Contact address
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|
Daniel TRUNEH
Portfolio
Coordinator
Mobile
+251-911-228 980
dtruneh@snvworld.org |
Pieter Lodewijk VISSER
Senior PSD advisor
Coordinator of SNV-BOAM - Southern
Portfolio
Mobile +251-912-07 29 56
pvisser@snvworld.org |
Project
objective
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The project objective is
“Sustainable increase in the production of exportable quality mango fruits
and increase in access to markets of mangos and other existing highland
fruits (apples, plums, peaches), through a sustainable supply of quality
mango seedlings and market promotion for mangos and highland fruits”.
By achieving this objective the programme aims
to harness the entrepreneurial capacity of producers, processors and
traders in poor communities with an economic potential in the SNNPRS (Arba
Minch area) and to bolster the subsequent effective use of this
strengthened capacity through increased access to local and export
markets. Its goal is to create income and new job opportunities, develop a
basis for the accumulation of capital, technology and skills and to
provide the foundations for fostering other dimensions of economic and
social development in these communities. The purpose is to develop
selected value chains within the perennial fruit crops sub-sector with a
high market potential and an important outreach to smallholder farmers,
thereby creating structural channels for the latter to earn a decent
living.
Primary target groups
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The primary target groups are the actors in the value chains
including farmers, producers, processors, traders and exporters’
organisations, which will be assisted to access resources and capacities
in order to better serve their members. Indirect target groups (means to
achieve the primary target groups); will include public- and
private-sector institutions, which will benefit from capacity development
support in order to deliver relevant services to different areas in the
value chains.
Area of value chain facilitation
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The value chain of mango and highland fruits determines
the areas of market development facilitation. This means the programme
activities will be driven by the constraints and market opportunities,
irrespective of where they occur. Thus the programme activities will not
be limited to the geographical boundaries of the two regions. The
dimensions of the value chains are not region specific. However,
activities will be spearheaded from SNNPR and more particular from the
area around Arba Minch.
Opportunities in the SNNPR region
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Opportunities in the region were identified
based on an identification mission during the inception of BOAM in
February until May 2005 when 29 potential sub sectors have been analysed
(national wide). During the identification mission, a number of criteria
were proposed for selection of potential commodities in SNNPR. These were
(amongst others):
-
smallholder-based production
-
percentage of production sold (the higher the better)
-
possibilities for chain integration
-
enhanced group activities
-
enhanced position of women
-
high added value (either via knowledge or via
agro-processing)
-
high market value
-
sound economic base (long-term comparative advantage)
-
good marketing opportunities, both on local and
export markets
-
exclusiveness
-
options for further innovations (knowledge-wise or
technology-wise)
-
supported by government policies
-
social acceptance
Based on these criteria and two overriding yardsticks
which are ‘potential market opportunity’ and ‘outreach to
smallholder farmers’, the perennial crop value chain was identified as
one of the most suitable.
Market potential of Mango Fruits
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The
government has a plan of expanding mango production by distributing high
yielding varieties for small scale farmers, especially in the Southern and
Oromia region by grafting mangos of known and high yielding varieties. In
July 2006, it was announced that the Oromia Government distributed 14,000
improved seeds of mango.
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Mangoes can
be processed in the following forms:
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Canned mangoes;
-
Mango juice;
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Concentrated mango drinks (e.g. mango fizzy drink);
-
Mango pulp;
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Dehydrated / dried mangoes;
-
Mango jams and chutneys;
-
Mango-applied products (e.g. mango skin cream, mango
detergent).
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Primary
product
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Selecting
the ripeness of mangos can be determined by either smelling or squeezing.
A ripe mango will have a full, fruity aroma emitting from the stem end.
Mangos can be considered ready to eat when slightly soft to the touch and
yielding to gentle pressure, like a ripe peach.
Medicinal uses
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Mango is one of the most recommended fruits to fight
beriberi and to heal bronchial diseases since a mixture of mango pulp and
honey can be made at home to fight bronchitis. Mango is an excellent
depurative for the organism and it is recommended for nervous people, to
fight insomnia, to heal brain fatigue, mental depression and as a
laxative, besides it is very helpful to fight heartburn. It has excellent
results when used to eliminate kidney sand and to assist digestion. Mangos
beyond being delicious and rich in vitamins, minerals and anti-oxidants,
contain an enzyme with stomach soothing properties.
Mangos are an excellent source of Vitamins A and C, as well
as a good source of Potassium and contain beta-carotene. Mangoes are high
in fibre, but low in calories (approx. 110 per average sized mango) fat
(only 1 g) and sodium. Mangoes are a good staple for your daily diet.
By-products
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Mango
kernel contains high amounts of fat and starch. The oil extracted from
kernel is of good quality and could be used in cosmetic and soap
industries. The kernel flour (starch) after mixing with wheat or maize
flour is used in chapaties in India. About ten per cent alcohol could be
obtained from mango kernel by co-culture fermentation.
Domestic market
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In the domestic
market,
consumption is largely in its fresh form due to the
fact that the cost increment for processing and packaging would make it
beyond the purchasing power of the vast majority of the Ethiopian consumer
group (low-income). However, since 1997 the demand for canned fruits in
Ethiopia has increased by 7% suggesting there is a sufficient domestic
market for canned mangoes to be produced.
Export
markets
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The mango
export markets are where the greatest growth potentials exist for mango
producers. The global mango markets are supplied by countries that are
strategically positioned to be preferred suppliers. For example, West
Africa is a key supplier to Europe due to its proximity to Europe and
direct sea-links.
The following table on
areas of intervention has been elaborated during the Local
Stakeholders Strategic Interventions Planning Workshop on Mango and
Highland Fruits in Arba Minich 1/2007.
More details see the workshop report for download in our
Library:
|
No. |
Areas of Intervention |
Group One |
Group Two |
Final rank of priority |
|
Priority |
Reasons |
Priority |
Reasons |
|
1 |
Improved supply of seedlings to farmers:
-
Introduction of new varieties;
-
Appropriate training of seedling
producers;
-
Support to farmers for
replacement of old trees with
new mango
varieties; and
-
Prevention of seedling
diseases |
4 |
To
improve the competitiveness of farmers or producers
|
1 |
To address basic problems; and
to ensure sustainability in production |
4 |
|
2 |
Stronger advisory services/training on various aspects of mango
production or marketing to smallholder farmers; |
1 |
-
To reduce the wastage of existing production; and
-
To improve the current low price of the products |
2 |
To
create solution for the prevailing market problems
|
1 |
|
3 |
Improved capacity related to mango in supporting institutions:
e.g., extension service, agricultural research incl.
R&D
center, local NGO training centers, ATVETs, etc. |
11 |
To
provide holistic support |
1 |
To address basic problems; and
to ensure sustainability in production |
11
(groups consensus) |
|
4 |
Promotion of intercropping and natural resource mgt. practices
appropriate for mango production;
e.g., irrigation and water management, integrated pest management,
composting, etc. |
9 |
Since
mango tree is perennial plant, this helps it to maintain its yield
over longer period of time |
9 |
To
support the organic production through encouraging natural
fertilizer use. |
9 |
|
5 |
Improved supply of specialized inputs; e.g., farm tools and crates; |
10 |
To
improve the production by making use of new technologies
|
4 |
To
support the organic production through encou-raging natural
fertilizer use. |
10
(groups consensus) |
|
6 |
Support to the development of cold chain facilities; |
3 |
To
prevent products from wastage and damages |
4 |
To
support the organic production through encou-raging natural
fertilizer use. |
3 |
|
7 |
Support to the establishment of market information systems; |
12 |
To
ensure the fair price for producers |
2 |
To
create solution for the current market problems |
12
(groups consensus) |
|
8 |
Support to better credit for all market actors to encourage
investment; |
7 |
To
improve the benefits of producers through improved buying capacity
of investors |
4 |
To
support the organic production through encouraging natural
fertilizer use. |
7 |
|
9 |
Support to an improved policy environment for
:
-
investment in mango
processing plants
-
commercial fruit farms.
|
6 |
To
attract investors and create closer market for producers
|
3 |
To
enable the government to formulate new direction and supportive
environment for fruits and horticulture production
|
6 |
|
10 |
Development of
market linkages by:
-
exploring potential for more
efficient domestic supplychains
-
developing export potential;
|
2 |
Since
mango fruit is perishable, this helps to create regular receiver and
thereby improve producers income |
2 |
To
create solution for the current market problems |
2
(groups consensus) |
|
11 |
Establishment of systems for
-
setting product quality
standards
-
certification of organic
production and conformance;
|
5 |
To
supply quality products |
3 |
To
enable the government to formulate new direction and supportive
environment for fruits and horticulture production
|
5 |
|
12 |
Support to national policy, strategy and program for development of
fruit and vegetable sub-sector
|
8 |
To
prevent from damages and wastages |
3 |
To
enable the government to formulate new direction and supportive
environment for fruits and horticulture production
|
8 |
Conclusions
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The
following points are to be drawn from the analysis above:
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The prevailing mango production systems in
Ethiopia
are largely oriented towards the domestic markets.
-
The major export potential of fresh mangoes from
Ethiopia is to the Middle East market.
-
There is a stronger potential for export of processed
mangoes both for the growing domestic market (in terms of juice and
canned mangoes) and selected export markets, as freshness is less of an
issue for processed goods, therefore opening up the option of sea-vessel
transport.
-
However, the declining price of mango – both fresh and
processed – means that export revenue growth potential is limited as the
market becomes mainstream with fierce competition from Mexico, Brazil,
Philippines, etc. who have cost and economy of scale advantages over
Ethiopia.
-
Ethiopia’s advantages lie in the niche product areas where its climatic
conditions are favorable. Mango is more suited to low altitudes and is
also becoming a mainstream product where volume is the key success
factor for international competitiveness (e.g. bananas, citrus) in
markets that are dominated by large, low-cost (often multinational)
producers
-
Ethiopia’s competitiveness lies in the tropical and sub-tropical
(exotic), off-season and organic markets. The latter point is especially
prevalent due to the traditional nature of Ethiopian farming production
methods being suitable for organic certification. Further, the organic
market is one where the price of produce has not trended downwards so
export revenues will remain robust. Organic production is more
labor-intensive than conventional methods, which will ensure Ethiopia
has a cost advantage due to its cheap labor.
-
If commercial farms were to contract out production by
commercial farms to smallholders through outgrowing schemes, it would
ensure the scale and support (e.g. technical advice, finance, seed,
agrochemicals, cold storage, export logistics and marketing) required to
export, but at the same time smallholder farming ensures a higher
standard of crop-care and organic production.
-
Therefore, the strategy should be to promote the sale of
organic mangoes to the European markets where
Ethiopia
has climatic advantage (using the right variety), mainstream / existing
mangoes for the Middle East markets, where Ethiopia has geographically
strategic advantage, and processed mangoes for selected export markets.
The initial agenda item for pursuing such a strategy will
be in product development and certification to meet international organic
standards, as well as improvements in the logistics infrastructure to
ensure manageable and predictable supply levels of the product.
Highland Fruits
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Introduction
It is
intended to determine the potential for substitution of imports of
highland fruits, with special emphasis on apple production with the aim of
creating interventions as part of a value chain program. This will also
provide the initial data set required to make decisions based on the
microeconomic and macroeconomic factors prevailing for the industry.
Apple
production is relatively new in the country. Trials in the southern parts
of the country and Central Shoa were conducted as far back as the
1950s-60s. One of the first apple productions was started about 40
kilometres from Addis Ababa on the way to Ambo in a small farm 15-20 years
ago. This farm has since ceased to produce apples.
It is
estimated that an individual farmer could make up to $150 to $275 a year
from producing apples over other crops in Ethiopia. Yet Ethiopia has
become a net importer of apple.
There is no
large scale production of apples in the country. This could be due to two
reasons:
 |
-
Apple grows in altitudes higher than 2200 metres. These
areas are highlands which are typically occupied by farmers.
-
Unlike lowlands where the population is scarce, it may not
be possible get large acreage of cultivable land in areas where farmers
have occupied for years.
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It is only
in the last 10 years that apple production has started to increase in
volume. There are only small plots of apple production in the country.
The
government of Ethiopia has the intention of importing selected apple
varieties of foreign countries to distribute to farmers. In July 2006, it
was announced that the Oromia Government distributed 25,000 improved seeds
of apple imported from Spain.
The extra
farmer incomes as well as the import hard currency savings for the economy
make this an opportune fruit market to produce locally for.
Domestic market
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At present,
small farmers are the main producers of apple in the country. The
varieties that grow in Ethiopia are the variety with low chilling variety.
They need relatively low periods of cold season to break dormancy.
There was
previously not enough know-how on apple cultivation in the country. It is
recently that the know-how of apple cultivation is expanding in the
country (the Kalihiwot church in Chencha is the leading apple material
distributor and provides training for farmers in apple production in the
country).
The price
of one apple seedling is 40 Birr, which is very high as compared to the
price of a citrus seedling which is only about 5-10 birr based on the age
of the seedling. However, farmers can earn an extra $150 - $275 per year
on apple production over other crops in Ethiopia.
Apple production is very
low and it can not even satisfy the local market. The production has been
increasing year-to-year, starting in the last 5-7 years. The price of a Kg
of apple in Addis Ababa market is as high as 30 Birr. This is an
artificially high price which has led to importation of apples to satisfy
demand.
Import market
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The retail
prices of imported apples in Ethiopia are (per Kg):
Peaches and
nectarines, another highland fruit, have been actually exported from
Ethiopia according to UN FAO, although in recent years Ethiopia has begun
importing. This trend is growing, which suggests that the local market is
growing and local production is not able to keep pace with the demand,
hence resorting to importation.
The following table on
areas of intervention has been elaborated during the Local
Stakeholders Strategic Interventions Planning Workshop on Mango and
Highland Fruits in Arba Minich 1/2007.
More details see the workshop report for download in our
Library:
|
No. |
Areas of Intervention |
Group One |
Group Two |
Final rank of priority |
|
Priority |
Reasons |
Priority |
Reasons |
|
1 |
Supply of seedlings to farmers:
-
Introduction of new varieties;
-
Certification of seedling producers to control for disease,
differentiate by variety and allow traceability;
-
Targeted training for seedling producers;
-
Disease prevention activities;
-
Build farmers interest to engage in apple production by facilitating
initial access to certified seedlings;
|
2 |
To
ensure the quality of seedlings distributed |
2 |
To
create and raise farmers’ or producers’ awareness in the production of
apple |
2
(groups consensus) |
|
2 |
Advisory services and training on business and technical aspects of
apple production and marketing to smallholders |
4 |
To have
visionary production and marketing activities |
8 |
To
enable producers know right time and appropriate practice of
production |
4 |
|
3 |
Build capacity of local institutions:
e.g.,
extension service, agricultural research incl.
R&D
center, local NGO training centers, ATVETs
|
1 |
To bring
a holistic change and dynamics in all stakeholders |
3 |
To
support the production and expansion of production by research
findings and proper exten-sion
advices |
1 |
|
4 |
Promote intercropping and natural resource management;
e.g.,
water resource management, integrated pest management, composting,
production of pyrethrum, etc.
|
2 |
To
ensure the quality of production |
10 |
To
ensure natural and environmental conservation and adaptation
|
2
(groups consensus) |
|
5 |
Supply of specialized inputs; e.g., pruning scissors, crates, etc.
|
2 |
To
ensure the quality of production |
12 |
To make
different and necessary inputs available at farmers’ disposal
|
2
(groups consensus) |
|
6 |
Explore the potential for more efficient supply chains and develop
associated market linkages; |
9 |
To
introduce and make use of new or improved ways of doing business
|
6 |
To have
better price for the products |
6 |
|
7 |
Support the development of cold chain; |
5 |
To
reduce the wastage of products and to ensure uniform supply
|
4 |
To
prevent wastages and to store for longer time |
4
(groups consensus) |
|
8 |
Support improved access to credit for all market actors to encourage
investment; |
7 |
To
increase the amount and capacity of producers and suppliers
|
9 |
To
improve production capacity
|
7 |
|
9 |
Support the establishment of a system for setting grades and standards
for apple quality and variety; |
3 |
It is
the only alternative to ensure better price for products |
7 |
To
enable producers competitive in the market |
3 |
|
10 |
Support the establishment of market information systems; |
6 |
-
To set the right price based on the available information
-
To balance demand and the supply
|
11 |
To
balance the market price and demand |
6 |
|
11 |
Support formulation of policy, strategy and program |
8 |
To help
internalize the systems of production and marketing in the society
|
1 |
For
market protection and to encourage inland (home country) products
price |
8
(groups consensus) |
|
12 |
Support for Apple processing |
|
|
5 |
|
additional point
(group 2) |
Import
Substitution
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The
conclusion for highland fruits is a clear case for import
substitution, via seed distribution, training and eliminating the shortage
of planting materials in the country.
Apples are
being imported from as far as Chile and USA, which suggests that the price
of apples could be as high as 300% of what it should be, suggesting high
earnings for farmers in this area.
There was no data on
plums available in the time-period, but with regards to peaches and
nectarines, there is clearly a local industry that needs to be increased
in volume due to the inability to satisfy the local demand as well as the
demonstrated ability to export the fruits.
Expected results
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Final results have to be defined
in a participatory planning session with all stakeholders. The following
listed results shall give only an illustration of the possible scope:
-
increased volume of mango planting material in export quality and hence
increased exportable volume of mango fruits
-
increased bee forage potential. (Mango trees are very rich in flowers and
have got nectar in considerable quantity, which is good source for honey
and beeswax business. One mango tree flower yield is 100 000 to 30 million
flowers and good forage for apiculture farming).
-
import substitution for apples by increased volume of locally available
highland fruits
-
increased value added by processing highland fruits (conservation of fresh
ware)
-
increased business opportunities for processors and farmers and hence
increased revenue and employment.
Documents
for Download
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SNV-BOAM Southern Portfolio, Addis Ababa 2006
Support to Business Organisations and their Access to Markets for Mango
and Highland Fruits
boam-mango-highland-fruits.doc
480 KB. All details about the planning of mango and highland
fruits value chain development.
Global Development Solutions
Consulting for SNV-BOAM, Southern
Portfolio, January 2007
Stategic Intervention Plan for Mango and Highland Fruits
SIP-for-mango+highland-fruits.pdf 512 KB
SNV-BOAM Southern
Portfolio, Arba Minich 1/2007
Local Stakeholders Strategic Interventions Planning Workshop
on Mango and Highland Fruits
mango-highland-workshop.doc
1,9 Mb
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