Regional Markets

3 Cases
(USD 39 to USD 46 per ton fresh roots). With local varieties, farmers would obtain half
the yield, thus practically production costs would double (from USD 70 to USD 140
per ton HQCF), resulting in a very small gross margin (USD 30 per ton HQCF). By
promoting the introduction of high-yield varieties, the project worked on ensuring that
production costs of HQCF remain competitive and smallholder farmers still receive a
good gross margin. If the first stage of processing (transforming fresh roots into pressed
wetcake) is outsourced, the farmer processor can secure a better gross margin (about
USD 45 per ton HQCF), but it is not without risks. In February 2011, the estimated
production costs of artificially dried HQCF exceeded the price biscuit manufacturers
were willing to pay for HQCF (due to the lower price of wheat). However, by having
all processing take place at the factory site, the processor price could be reduced to a
viable level for supplying HQCF to the paperboard industry.
Innovation and sustainability
Equipment should not be purchased based on price alone: tight quality control and
technical backstopping for manufacturers of equipment is crucial. Making high-quality
products for new markets requires processing equipment that is of the right specifications,
to assure quality and processing efficiency. Although NGOs and donors have
distributed graters and presses for cassava processing before, the equipment was often
designed for household processing, where timeliness and volume issues are less important
than in a commercial HQCF VC. Furthermore, the equipment was often of inferior
quality and often broke down because of inadequate maintenance. C:AVA faced
this problem in the sun-dried VC; the equipment failed to meet the requested technical
specifications and had to be modified. The project also took steps to include and
empower the private sector as drivers of innovation in the HQCF VC. Taking advantages
of pre-existing strong links amongst the private sector (processors and end users)
is crucial. Working closely with the private sector can have very positive effects on the
sustainability of project outcomes (Sandifolo 2010a).
Concluding remarks
There is potential to include small-scale producers in both sun-dried and artificially
dried HQCF value chains. Proximity to customers and lower production costs give
the sun-dried HQCF VC a competitive edge in the rural market. Quality, reliability
of supply and economies of scale give the artificially dried HQCF VC the edge in the
industrial markets (Westby and Adebayo 2010). A crop initially meant as food security
crop might become a profitable cash crop with such increased market opportunities.
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