Value Chains research report Tajikistan final - Microfinance Centre

• It is not profitable for farmers to produce tomatoes for processing where the
tomato prices are dictated by processing businesses and not by market forces. It
is difficult for processors to pay higher prices for raw product as they are focused
to sell to the lowest segment of the market which leaves little room for price
negotiation.
Payment is a serious problem for farmers. Frequently they are not paid for raw
product for as much as a year and often in barter goods, not cash. Because of the
problems in obtaining raw product over one half of the processors work 6 months or
less per year and even when working they are operating at a much reduced capacity,
many averaging below 66%.
Processors face additional problems beyond low raw product supplies. They are:
• Low quality of production;
• Outdated equipment;
• High cost of credit;
• Lack of quality control throughout the supply chain;
• Narrow internal market;
• Irregular supply of raw materials and production; and
• Lack of long-term contracts for product supply.
The processing side will require significant investment before it achieves
sustainability. Processors need to offer a higher quality product meeting consumer
demand. To improve the processing industry outlook it is necessary to improve the
produced output quality in taste, content stability, color, packaging and package. It is
necessary to make substantial changes in the production and marketing sectors to
change the status of existing and potential Tajik exporters. It is necessary to change the
tomato production approach radically, and it should be started at the producer level.
Processors must make contracts for the tomato varieties with long maturation periods,
thereby ensuring raw materials for a longer time.
In addition there are considerable challenges to developing a sustainable
industry around them, both from a production and from a market perspective. These
include:
• Supply issues need to be addressed, such as raw product availability, quality
and consistency of raw product, effective grading of product and appropriate
inventory management of all components in the chain to minimize fluctuating
demand/supply flows. Associated with supply is the question of sustainability and
efficiency of wild-grown product and bush harvesting methods, which, while
culturally extremely important, and should be fostered, are unlikely to be
plausible as the only source of product in a commercially driven environment.
• Sustainable and reliable linkage between out growers and the farm is critical.
Hence, providing necessary support including different inputs, trainings and
demonstrative farming are all provided by the farm to create strong linkage.
However, there is lack of trust and reliability on out growers, due to the fact that
out growers divert and sold the expected product to the market creating supply
gap on company’s planned delivery.
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