value chain/ market analysis of the orthodox tea sub ... - Nepal Trade

3.2 FunctionsThe major functions involved in the orthodox tea value chain are input supply, production,transportation/ collection, processing, blending and packaging, and exporting and domestictrading (wholesaling/ retailing). The input supply function is carried out by agro-vets andfertilizer distributors. Farmers and tea gardens are equally involved in getting their owninputs such as saplings, manures, and bio-pesticides. The transportation/collection isconducted by farmers, tea estates, cooperatives as well as green leaf brokers. Processing iscompleted by large/medium factories and small processors. Blending and packagingfunctions are conducted either by individual companies or the tea factories, themselves. Mostof the exporting is conducted by factories. Some trading companies are also involved inexportation. Domestic trading is conducted by outlets of factories, wholesalers, and retailers.3.3 ActorsA brief description of the actors involved along the orthodox tea value chain is listed below:· Input Suppliers: Besides a few plantations including Ilam Tea Estate, Nepals entire teaplantation is carried out by using cloned planting materials. Most of the clones arederived from an existing mother bush. Small holder farmers and tea gardens usuallyprepare clones from their own fields; however, some get the clones from commercialnurseries which are very few in numbers. The extension offices of NTCDB also maintainthe mother bush. The research and development of new clones are still lacking.Agro-vets supply the necessary inputs like pesticides, insecticides, sprayers, and otheragricultural equipment. There are registered companies that supply fertilizers to farmers.For organic production, organic manure is prepared by small holder farmers; however,they also purchase organic fertilizers, bio-pesticides, and insecticides.· Producers: Smallholder farmers play a significant role in the production of orthodox tealeaf. According to NTCDB data, 67 percent of total orthodox tea production wascompleted by small holder farmers in 2009/10 and the total numbers of small farmersinvolved in green leaf production (excluding Jhapa 3 ) reached 7,781 in 2009/10. The totalproduction area of small holder farmers producing orthodox tea is 4,987 ha (NTCDB,2011).Most of the producers supply directly to large and medium sized factories. Some supplyto small processors and some conduct hand-processing themselves. The green leaves arealso collected by local collectors and cooperatives.There are several orthodox Tea Estates owned by factories. The total area of Tea Estatesas presented by NTCDB is 3,052 ha in 2009/10. The Tea Estates employ laborers formaintenance and harvesting of tea bushes. The current wage rate is about 120 NRP/dayand some other incentives are provided by the Tea Estates depending on the quality of theharvest. Some provide social incentives like education to farmers/laborers. Six NTCDBprogram offices in four districts are also involved in production and supply green leaf tofactories.3 Jhapa has mainly green leaf production for CTCValue Chain/Market Analysis-Orthodox Tea 21