High-Value Commodities and Agroprocessing - International ...

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STAGES 1 & 2 (FARM GATE) TECHNOLOGY INDUSTRIES FIELD CROPS HORTICULTURAL CROPS LIVESTOCK FORESTRY LOGISTICS processing facilities is itself an essential first step towards stimulating both consumer demand for the processed product and as well as assuring adequate supply of the raw material. The provision of transport, power and other infrastructure required for agro-industries also benefits agricultural production. The development of these and other industries provides a more favorable atmosphere for technical progress and the acceptance of new ideas in farming itself. Agroprocessing operations (such as sun-drying) can preserve food for longer than its fresh shelf life and can salvage waste food. For some basic foodstuffs (rice, for example), it is essential that before the food can be eaten it must be de-husked. It can help raise the nutritional value of poor people’s diets and contributes to important cultural practices by providing foods with a more interesting taste than the daily staples. Today, however, it is becoming even more difficult to provide a precise demarcation of what should be considered an agroindustrial activity. The impact of innovation processes and new FIGURE 1: AGR0PROCESSING VALUE FERMENTING MACHINERY RESEARCH AND DEVELOPMENT MARKETING INPUT SUPPLIES MOLDING LIVESTOCK ISSUES Agroprocessing CUTTING FORTIFICATION STAGES 3 STAGES 4 MILLING GOVERNMENT SUPPORT P A C K A G I N G QUALITY ASSURANCE AND STANDARDS LARGE-SCALE BAKERY & CONFECTIONERY FRESH, DRIED, CANNED & FROZEN FRUITS PROCESSED, DRIED, FROZEN & CANNED VEG BEVERAGES SUGAR PROCESSED, VALUE ADDED MEAT & MEAT PRODUCTS INPUTS FOR BIO FUEL INPUTS FOR CHEMICAL INVESTORS technologies suggests a widening of the range of agro-industry inputs that could be considered, including biotechnological and synthetic products. Corresponding to this growing complexity of inputs is an increasing range of transformation processes, characterized by physical and chemical alteration aimed at improving the marketability of raw materials according to the final end use. All these factors – the growing complexity of inputs, the impact of innovation processes and new technologies, the sophistication and the growing range of the transformation processes – make it increasingly difficult to draw a clear distinction between what should be considered strictly industry in the broad sense and what can be classified as agroindustry. Many poor people in sub-Saharan Africa depend on agriculture for a living and it is important that this sector is well funded to enable continuous growth. An assessment of Africa’s productivity potential indicates that only 10% of the land is prime quality, 7% is of high potential and 28% is of medium to low potential. 251
The remaining land (55%) is unsuitable for production and is considered to be fragile, easily degraded because of bad management, and in general not productive or does not respond well to soil amendments. To improve food and nutrition security, the prevailing developmental view of agriculture in the region, which focuses mainly on production, must be expanded to include processing. The development of the agro-processing industry (Figure 1) is needed to improve fortification, nutrition and health through better diet. Furthermore, to harness the full potential of agroprocessing there must be a parallel growth of the other sub-sectors in the agribusiness system that includes the input, production, marketing and support sub-systems for maximum profit. The traditional view in most African countries is for the government to focus first on the agricultural sector in terms of policies, programs and resources, and then shift its emphasis to the industrial sector later when the former has become more efficient. The Food and Agriculture Organization (FAO) considers agroprocessing as a subset of manufacturing that processes raw materials and intermediate products derived from the agricultural sector between harvesting and final use (Gallat, 2007; FAO, 1998). It is also a means to alleviate poverty and address food security. However, special attention must not only be given to policies (and their sustainability) that affect the prices of inputs and outputs to producers, processors and consumers – such as policies regarding taxation, subsidies, direct support and tariffs in the short and the long term – but also to policies that contribute to the creation of an environment suitable for business and investment growth. Access to appropriate technical processes, machinery and equipment, technical inputs and markets must be carefully developed and maintained. Furthermore, the “production chain” must be a continuum from the raw material producer through to the processor, distributor and buyer, with each link being strengthened and improved in the process through research and development (Figure 1). Cooperative production chains and their administration are a key component in the development of agroprocessing. Furthermore, enterprise and business must be at the heart of poverty eradication, not just aid, trade and debt (Shell Foundation, 2008). The overall goal of this paper is to highlight the challenges and opportunities for agro-processing and marketing horticultural crops in Sub-Saharan Africa. In the preceding section, we have highlighted the scope for agroprocessing in the region. In the 252 following sections, we provide a general overview of processing as a value-adding in agro-industrial enterprise, and review case studies of value adding in Sub-Saharan Africa agro-industry. Finally, we outline some of the enabling policy issues which underpin successful agro-industrialization, including marketing and market infrastructure development, finance and access to micro-credit, enhancing the role of women in food and agroindustry, and sustainable capacity building. Case studies of value-adding activities in sub- Saharan Africa agro-industry Case study 1: Agroprocessing in South Africa Agroprocessing is well developed in South Africa and contributes about 10% of South Africa’s GDP and it is the third largest manufacturing sector. Agroprocessing is the second most labor-intensive sector and in 2006 provided exports valued at up to 23 billion Rand (~US$ 2.5 billion) (Department of Trade and Industry-DTI, 2006). Fruit and wine are the largest export products by volume and value. There are many food-processing companies and the top 10 are responsible for about 70% of the industry’s turnover. These top 10 companies include: Nestlé, National Brands, Premier Foods Nabisco, and Unifoods/Best Foods; five of these food companies are listed on the South Africa Stock Exchange – AVI Ltd., Tiger Brands, Illovo Sugar Ltd., Toongat-Hullet Group and All Joy Foods Ltd. There are also smaller food companies that show strong potential, which produce health beverages, indigenous teas, traditional and exotic meats, dried fruit products, nuts, fruit juices, etc. In the case of South Africa, all food companies receive support (incentives) from DTI. Case study 2: Agroprocessing in Kenya Various factors may constrain the ability of small-scale enterprises to effectively manufacture and market processed food products. On a macro level, many policies hinder the development of small-scale industries. At the firm level, limited access to credit, lack of appropriate technologies, unreliable supply of raw materials, poor managerial skills and poor quality control constrain the development of small-scale industries. Although crops may be produced throughout the year in Kenya, they tend to be available only part of the year (Muhammad and Kiilu, 2004). Moreover, they are perishable commodities whose shelf life depends on how they are handled after harvest. Technologies to extend shelf life (or storage) or processing to increase availability during the year will be beneficial (Wasilwa,
Page 1 and 2: 218 Section 4 High-Value Commoditie
Page 3 and 4: Table 1. Average annual growth rate
Page 5 and 6: Farmers that cannot meet these crit
Page 7 and 8: Table 4. Overall food market share
Page 9 and 10: staples and dairy, under the expect
Page 11 and 12: Current status of horticultural sys
Page 13 and 14: Third, the cost of communications i
Page 15 and 16: Wholesale market logistics Wholesal
Page 17 and 18: to seed propagation and disseminati
Page 19 and 20: Graffham, A. and J. MacGregor. 2009
Page 21 and 22: Growth in high-value export markets
Page 23 and 24: have become the main export sector,
Page 25 and 26: Source: calculations based on FAOst
Page 27 and 28: smallholder contract-farming in hig
Page 29 and 30: Source: Maertens and Swinnen (2009)
Page 31 and 32: References Aksoy, M.A. and J.C. Beg
Page 33: Value adding and marketing food and
Page 37 and 38: system has not developed credit fac
Page 39 and 40: of container sizes allows the marke
Page 41 and 42: without changing taste. The groups
Page 43 and 44: Through various innovative agroproc
Page 45 and 46: Programme and community institution
Page 47 and 48: The production, processing and pack
Page 49 and 50: An assessment of the potential effi
Page 51 and 52: Figure 1. Six experimental sites fo
Page 53 and 54: and socio-economic research goes ba
Page 55 and 56: Raw material market assessment For
Page 57 and 58: Table 4. Local market trade: prices
Page 59 and 60: the fixed capital for Zogowale rema
Page 61 and 62: The role of farmers’ knowledge, w
Page 63 and 64: References Abass, A.B. 2006. “How
Page 65 and 66: ecently, the 2008 World Bank Develo
Page 67 and 68: e achieved through a focus on techn
Page 69 and 70: 286 Box 2: The “Milk War” In De
Page 71 and 72: Change Impact Mechanism Behavioral
Page 73 and 74: efficient functioning of these link

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