REPBLICA DE MOAMBIQUE

MINISTRIO DE ADMINISTRAO ESTATAL DIRECO NACIONAL DE PROMOO DO DESENVOLVIMENTO RURAL PROJECTO DE DESENVOLVIMENTO DE PEQUENOS PRODUTORES ORIENTADOS PARA O MERCADO NO VALE DO ZAMBEZE

Research Report on Sesame, Mapira, Maize, and Pigeon Pea Value Chains Analysis in Zambeze Valley (Morrumbala, Mopeia, Chemba, Maringue e Mutarara): For Market Oriented Smallholder Producers.

An analysis of the performance of the existing chains with the view of strengthening their efficiency and profitability for Smallholder farmers

Report on Research on Essential Value Chains for Small holder Producers in Zambeze Valley
Preamble Value chain analysis has become the most appropriate tool to diagonise and flash out problems and challenges facing agro-marketing in general. It has, for years being used as a tool that helps in linking farmers, in particular smallholder farmers with lucrative markers, helping in transforming many subsistence farmers in to smallholder semicomercial and speciality commercial farmers. The concept of value chain is not privy to agriculture, it was revolutionize in the manufacturing Industry by Michael Potter in 1985, and has been known as Potters Value Chain Model. Key to this theory is VALUE ADITION. 1Michael Porter in 1985 introduced in his book The Competitive Advantage the concept of the Value Chain. He suggested that activities within the organisation add value to the service and products that the organisation produces, and all these activities should be run at optimum level if the organisation is to gain any real competitive advantage. If they are run efficiently the value obtained should exceed the costs of running them i.e. customers should return to the organisation and transact freely and willingly. Michael Porter suggested that the organisation is split into primary activities and support activities. This basis theory was modified by various other utilisers to suit their own situation. In agriculture it was adopted to track the product form production at farm level throughout its transformation up to the state of consumption by the final consumers. Taking into consideration that through out the chain there is need for; Coordination and collaboration; Investment in information technology; Changes in organizational processes; Committed leadership; Flexible jobs and adaptable, capable employees; A supportive organizational culture and attitudes; It is in this contest that Market Led Small holder Development in the Zambezi Valley Project, commissioned a study of the current agriculture value chains in their area of focus to use this available knowledge to strengthen market access for small holder farmers in the valley.
1

Wikipedia value chains

Executive Summary

Introduction
The Government of Mozambique (GofM), through the Ministry of state Administration (MSA) is implementing a Project, Market Led Small holder Development in the Zambeze Valley, In some five districts of Morrumbala, Mopeia (in Zambezia), Chemba and Maringue (in Sofala), and Mutarara (in Tete). The general objective of the project is to increase smallholder producers income in the selected districts of the valley. The increase in income will not only be achieved through direct assistance to the smallhoder farmers and other critical stakeholders in supply and value chains, but also through reinforcing capacity to realize and manage service provision in the context of Mozambican government decentralization policy. The project has na Environmental objective of stoping and reversing the process f degradation of ecosystems in the region as well as improving its capacity of absorbing the effects of climate change. The project is composed of four elements, thus: a. Community based organisations developments (CBOs) and strengthening their institutional capacity at local level; b. Developing Agricultural production and commercialization capacity; c. Community Agriculture and Environmental Investment Fund; d. Project Management, Coordination, monitoring and Evaluation; To transform the subsistence farmer in to a market oriented farmer, it is essential that the production is valued from agro-business view point and that they have easy links with the market that will consume the increasing volume and remunerate better quality. In this way, it is very important for the project to promote the development of value chains e markets, especially improving the capacity of the actors, providing public and private services that are important in strengthening and diversifying market linkages. In this context, the project seeked to do an in-depth analysis of the value chain for Maize Sorgham, Sesame and Pigeon Peas.

I. Natureza das Funes do Especialista A Natureza das funes do Especialista enquadra-se nos seguintes aspetos:

Ao nvel dos distritos, as funes e responsabilidades do setor pblico na promoo e desenvolvimento dos mercados esto ainda pouco desenvolvidas e circunscritas ao licenciamento das atividades comerciais e industriais e aplicao mecnica da

regulamentao existente. A ativa promoo do desenvolvimento dos mercados dos produtos agrrios e pesqueiros , na presente fase, absolutamente necessria para aumentar os rendimentos dos pequenos produtores que o objetivo central do projeto.

O especialista ser responsvel por apoiar as instituies distritais relevantes a na reativao, expanso e modernizao da proviso das funes publicas no mbito da promoo da eficincia das cadeias de valor e redes dos agro-negcios e para que o valor criado/acrescentado seja distribudo pelos intervenientes dessas cadeias e redes de forma a remunerar o esforo e a contribuio de cada grupo interveniente e a criar incentivos para crescimento e desenvolvimentos subsequentes.

O especialista ir trabalhar no quadro dos objetivos e do modelo de implementao do projeto que estabelece a absoluta necessidade de promover a execuo e plena responsabilizao por parte das instituies pblicas distritais bem como a promoo da participao das comunidades rurais, organizaes de produtores e comerciantes e outros intervenientes relevantes no desenvolvimento das cadeias de valor, mercados e redes de agro negcio nos setores da Agricultura e Pescas.

O especialista dever ter o papel de dinamizador, formador e facilitador tomando a liderana nas atividades de natureza analtica e na conceptualizao das atividades promovidas pelo projeto, preparando metodologias e materiais de apoio concepo, execuo e avaliao das atividades que devero ser feitas com o pleno envolvimento e empoderamento das instituies pblica distritais e dos grupos especficos de beneficirios.

No sendo a atividade de desenvolvimento dos mercados dos produtos agro-pecurios e pesqueiros uma atividade que possa ser desenvolvida isoladamente o especialista dever trabalhar em estreita coordenao com os outros tcnicos de projeto e integrarse plenamente na equipa do projeto dando tambm a sua contribuio noutras reas da implementao do projeto de acordo com as suas capacidades e as necessidades do projeto.

Integrating smallholder farmers in to value chain need a comprehensive effort to organise them in product specific economic grouping in form of association, cooperative and farmers forums, depending on the size of area covered, farmer and farming development, local social and economic development level, educational level, skills

development and available market potential. Often farmers lose control of their produce beyond the farm gate as they only benefit from farm gate price. For smallholder producers in the Zambezi Valley (Morrumbala, Mopeia, Mutarara, Chemba and Maringue) a detailed research in some value chains will be carried out for Sesame, Pigeon pea, Mapira, Honey and Maize. This will give some insight on how to integrate the smallholders farmers in various lucrative chains that are stable and long term. This will also help in identification of the best strategies to improve agribusinesses and amplify their potential in the fore mentioned area. Critical the value chain approach is a comprehensive, analytical approach to increasing efficiencies along entire value chains from crop production through processing and marketing and always with an eye towards quickly improving the productivity and profit margins of large numbers of smallholder farmers. Our interventions minimize market distortions and build the capacity of private sector participants to act on their own behalf. Commercial crops must meet specific quantity, quality, packaging and delivery schedule requirements of a particular market. In the case of Zambezi valley Smallholders, this analysis will aim at identifying Gaps, SWOT, in the farmers groups, key chain players and the environment in which they perform their activities. In particular a participative analytical approach will be used to measure the effectiveness of their production capacity in terms of quantities supplied, quality, productivity and delivery patterns. On the other hand an analysis will be made to ascertain the needs of the end user markets and understand how the farmers and their intermediary markets are working towards fulfilling these needs. Some critical analysis will be made to ascertain how the inputs are supplied and how it is benefiting the farmer in reducing production costs. It is essential understand the inputs supply dynamics and how there are improving efficiency in the value chain. This is part of the profitability analysis that will be carried out for the chosen value chains, including the distribution of profit margins. Lastly an analysis of how information flows within and without the value chains will be carried out. This will include production information, negotiations and the flow of marketing information. This is paramount in helping smallholders to make informed decisions and improve their power base in the entire value chain.

Of particular interest is studying how smallholders in the foresaid areas are guaranteed food security. The study recognizes that in order to succeed in promoting economic opportunities there is need to first ensure that Smallholder in Zambezi Valley can meet their basic food needs and that vulnerability to future crises is reduced. The study will analyse the possibility to Trainings and technical assistance to increase beneficiaries knowledge of appropriate inputs as well as best agronomic, post-harvest handling, record keeping, marketing and nutrition/hygiene practices, Association and cooperative development to help communities take collective action for increased food security, Income-generation activities at both on- and off-farm sites to provide vulnerable populations with increased household income and Improved financial systems through savings and credit technical training and linkages with the financial sector

Rationale of the Study

The main objectives of this study are to establish strategies, methodologies and procedures to will help smallholder producers in Zambezi Valley to;

increase the productivity and profitability of existing and new community farming and business activities in an environmentally sustainable manner expand stakeholder knowledge of, access to and control of key livelihood production and market systems through information systems and technology improve the economic well-being, business activities and entrepreneurial spirit of smallholder farmers, and try to upgrade them to small-scale commercial farmers build the capacity of local associations ( CBOs) and rural entrepreneurs to form and manage democratic and economically strong associations/ businesses Create capacity at District government level to carry some value chain analysis and create an enabling environment for agribusiness as well as creating synergies that will catalyse agriculture development in the Zambezi Valley area.

The study focuses on the need to improve access to markets and marketing information for Smallholder producers in the Zambezi Valley by integrating them in lucrative and efficient value chains where they will be able to increase their household income from farming and noon farming activities. This entails linking them to formal and lucrative markets and creates an enabling environment that will allow them to improvement of production and productivity of the fore mentioned crops. The study will take a particular interest in the following: Increasing Competitiveness, Service Linkages and Market Access Associations, Cooperatives and Capacity Building End markets Business enabling environment

Horizontal linkages (Producer/ Buyer relationship) Supporting markets, including finance and other sector- and nonsector-specific services and products Agribusiness opportunities Power dynamics among specific value chain actors Access to learning and innovation Distribution of benefits

Historic background on value chain: understanding the concept Importance Applicability

Area of study The research will be carried out principally for the benefit of 5 districts linked to the project (Morrumbala, Mopeia, Chemba, Maringue and Mutarara). Most of the primary data concerning selected value chains will be collected from all important stakeholders in these areas. However data from buyers and other important stakeholders like provincial Authorities will have to be collected outside of the valley. Basically most of the buyers are from Manica, Chimoio; this entails collecting data from this area. Deliberation on key research issue The main objective is to gain an inside understanding of the main issues thus; understanding the main actors, their strengths and challenges, gaps between actors, the environment (business) as well as understanding the facilitating organisations and their roles. This will help in having a clear foresight on the intervention strategies needed to strengthen the existing chains. Understanding the producer will also give an insight to the other two components that are paramount to the development of the farmer thus inputs provision and extension support services. Input provision on its own have to be wholly understood as the nature of supply chain to have a direct impact on the production and productivity of smaller holder farmer. The valuation of the inputs can also be spiky issue that needs to be well understood so that will adequately appreciate the ability of the farmer to meet demand. The impact of supplying (giving/ handing) over versus purchasing (buying with cash or coupons) Findings Challenges Recommendations Action plan Coinclusion Annexes

Develop structure for data analysis

This is largely meant to help siphon the data in to usable information. In so doing the three themes identified are; Identifying of trends patterns and interpretation This will enhance the understanding of issues past present and future in the selected subsectors in the fore mentioned districts. The insight gained will enable the researcher to do an in-depth analysis of the targeted groups and give more accurate recommendations. Writing of findings and conclusion as well as giving recommendation. This is the ultimate result of the value chain analysis. This will give a launching board for the formalisation of markers for small holder producers. The following structure of a written report is suggested give a clear picture of the reality of the selected value chains: Executive summary (including preface) Content Page Findings Conclusions Recommendations Appendices