ROOT AND TUBER SYSTEMS PROGRAM: Commercial Viability of Agro-enterprises Year 2007

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Cassava Enterprise Development Project in Nigeria,Small-scale Cassava Processing and Vertical Integration of the Cassava Sub-sector in Southern and Eastern Africa,Utilization of Cassava Chips in Animal Feed in the ECA Region

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ROOT AND TUBER SYSTEMS PROGRAM: Commercial Viability of Agro-enterprises Year 2007

  1. 1. ROOT AND TUBER SYSTEMS PROGRAM: Commercial Viability of Agro-enterprises Year 2007 International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  2. 2. IN THIS PRESENTATION:1. Cassava Enterprise Development Project in Nigeria2. Small-scale Cassava Processing and Vertical Integration of the Cassava Sub-sector in Southern and Eastern Africa3. Utilization of Cassava Chips in Animal Feed in the ECA Region International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  3. 3. THE CASSAVA ENTERPRISE DEVELOPMENT PROJECT IN NIGERIA• Main objective is to increase economic opportunities through sustainable and competitive cassava production, processing, marketing and agro-enterprise development in selected communities of the South-South and Southeast States of Nigeria• Implemented in the States of Abia, Akwa Ibom, Anambra, Bayelsa, Cross River, Delta, Ebonyi, Edo, Enugu, Imo, and Rivers• In partnership with the Federal Ministry of Agriculture and Water Resources, National Root Crops Research Institute (NRCRI), Root and Tuber Expansion Programme (RTEP), Agricultural Development Programmes (ADPs), farmers, and private investors International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  4. 4. BIRD’S EYEVIEW OF ACTIVITIESPRODUCTION PROCESSING MARKETING• create awareness • Training on processing technologies • Facilitate establishment• training (crop prodn and mgt) • Linking cassava processors to machine of market linkages• Cluster farming fabricators• Setting-up and training service • Training on equipment and general factory maintenance and hygiene providers• Link to input suppliers (agro- chemicals, cuttings) BUSINESS DEVELOPMENT SERVICES• demo on farm machine utilization• Mechanized farming Guaranteed supply of raw Improved regularity of supply• Guaranteed supply of farming cassava tubers for processing of processed inputs products CREATED JOBS, IMPROVED LIVELIHOODS International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  5. 5. CEDP ACHIEVEMENTS AS OF 2007 END• Introduced 43 improved CMD resistant cassava varieties with a potential yield of over 30 Mt/ha. Ten of these have been released and seven more submitted to the committee for approval• More than 200,000 farmers are planting improved varieties and the area currently under sustainable land management is over 19,000 ha• Commercial farms now exist• 120,000 farmers received improved CMD resistant varieties, and their yields increased from 11 Mt/ha to 25.6 Mt/ha. International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  6. 6. Yield of improved and local cassava varieties in farmers fields by State 12.3 Imo 21.7 Loc_yld 11.6 Imp_yld Enugu 27.1 10.5 Edo 25.4 15.8 Ebonyi 27.3States 10.6 Delta 24.2 15.1 Cr. River 24.7 13.9 A Ibom 23.2 13.4 Abia 28.3 12.1 Anambra 28.4 0.0 5.0 10.0 15.0 20.0 25.0 30.0 Yield t/ha International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  7. 7. • Established 451 processing enterprises, 71% of which started operations within 2007. The types of processing centres are SMEs (1-2 Mt/day), MPCs (<1 Mt/day), ICs, and mobile cassava graters (0.5 Mt/day) The new mobile grater entrepreneurs in Enugu State (capacity 400 kg/day) A micro processing center (MPC) inJob creation for youth and women Cross River State (capacity 600 kg/day) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  8. 8. • In these enterprises, 3,000 new jobs were created.• Generated an accumulative income of N1,400,465,436 or $11,868,251.15 USD (December 2007 exchange rate of 1USD=118N): Mobile grater enterprises (MGEs) = 0.78% Micro-processing centers (MPCs) = 2.58% Small to medium-scale enterprises (SMEs) = 27.98% Sales of fresh cassava tubers by farmer-beneficiaries = 68.10% Weed control service enterprises = 0.56%• In collaboration with Ekha Agro Farms Limited, the largest glucose syrup factory in Africa was built in Ogun State, which has saved Nigeria $15 million per annum on importation• Promoted local, national, regional and international trade by linking producers, fabricators and processors to markets International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  9. 9. • Some examples: The Aquada Enterprise (Abia State) now exports Scintilla hyper-fine gari flour to Baltimore, USA under the AGOA Initiative. Export to date is 11 tons valued at $46,875.00. Drena Farms Limited (Delta State) now exports Gari and fufu to London and New York in the USA. Export to date is 35 t valued at $22,400.00. Jon Tudy Foods (Delta State) now supplies 2,700 20-pound-bag gari to USA and currently has an order of 3,000 bags per month. “White garri” for export from Jon Tudy Foods in Delta State International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  10. 10. Quality andStandards Quality and standard specifications are available for cassava flour/composite flour, Gari & Starch by Standards organization of Nigeria. The Standards was largely derived from ISO, Codex Alimentarius. International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  11. 11. Financial Performance of Sample Enterprises (21% of 65%) BENEFITS & COSTS BENEFITS & COSTS SAMPLE ENTERPRISES, ABIA STATE SAMPLE ENTERPRISES, AKWA IBOM STATE 80,000 120,000 70,000 100,000 FIXED COST VALUE (Naira) 60,000 VARIABLE COST 80,000 FIXED COST 50,000 VALUE (Naira) 40,000 TOTAL COST 60,000 VARIABLE COST 30,000 TOTAL SALES, 1 TON 40,000 TOTAL COST 20,000 NET INCOME, 1 TON 20,000 TOTAL SALES, 1 TON 10,000 0 NET INCOME, 1 TON 0 -20,000 i E ap -10,000 o3 o1 o2 ak ua Es E 1 li Um ike 1 2 2 ere AG a i no AG ay hia ba Et om Ab Nd wa wa hia uy Uy Uy ng wa ud Ig Al ua ua -40,000 ER ER ng isi Ng Ng ua Um Nu Ik ap Um Um Os Nu AV AV Ok COSTS & BENEFITS COSTS & BENEFITS SAMPLE ENTERPRISES, ANAMBRA STATE SAMPLE ENTERPRISES, BAYELSA STATE 80,000 100,000 70,000 80,000 60,000 FIXED COST VALUE (Naira) FIXED COST 60,000 VARIABLE COSTVALUE (Naira) 50,000 VARIABLE COST 40,000 40,000 TOTAL COST TOTAL COST 30,000 20,000 TOTAL SALES, 1 TON TOTAL SALES, 1 TON 20,000 NET INCOME, 1 TON NET INCOME, 1 TON 0 10,000 E a 1 2 3 4 we go bia -20,000 am AG ls a ls a ls a ls a du 0 eg Og gb ye ye ye ye ER Ne Gw Sa Umuze Ihiala AVERAGE Ba Ba Ba Ba -10,000 AV International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  12. 12. COSTS & BENEFITS COSTS & BENEFITS SAMPLE ENTERPRISES, CROSS RIVER STATE SAMPLE ENTERPRISES, DELTA STATE 100,000 80,000 80,000 70,000 60,000 FIXED COST VALUE (Naira) 60,000 FIXED COST/Location 50,000 VALUE (Naira) 40,000 VARIABLE COST 40,000 VARIABLE COST 30,000 TOTAL COST TOTAL COST 20,000 20,000 TOTAL SALES, 1 TON TOTAL SALES, 1 TON 10,000 NET INCOME, 1 TON NET INCOME, 1 TON 0 0 Abualegu Kanyang Kesimekpa NTABE Godilogo AVERAGE -10,000 i E Ab r Ns a 1 Ns a 2 3 Sa 1 2 Ns ale ER o Ot ghel Sa h -20,000 bo AG AV av we le le wa -20,000 Kw w w Ag pe pe -o U uk uk uk or -40,000 COSTS & BENEFITS COSTS & BENEFITS SAMPLE ENTERPRISES, EBONYI STATE SAMPLE ENTERPRISES, EDO STATE 80,000 150,000 60,000 100,000 FIXED COST FIXED COSTVALUE (Naira) VALUE (Naira) 40,000 VARIABLE COST 50,000 VARIABLE COST TOTAL COST TOTAL COST 20,000 TOTAL SALES, 1 TON 0 TOTAL SALES, 1 TON E NET INCOME, 1 TON i za ike dia o a o NET INCOME, 1 TON ch b iar Ug AG mo olo Au bo 0 an -50,000 Ivb ER Idu Igb Ev Igb AV Abakaliki Ebonyi 2 Ebonyi 3 AVERAGE -20,000 -100,000 International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  13. 13. COSTS & BENEFITS COSTS & BENEFITS SAMPLE ENTERPRISES, ENUGU STATE SAMPLE ENTERPRISES, IMO STATE 70,000 70,000 60,000 60,000 50,000 FIXED COST FIXED COST 50,000 VALUE (Naira) VALUE (Naira) VARIABLE COST VARIABLE COST 40,000 40,000 TOTAL COST TOTAL COST 30,000 30,000 TOTAL SALES, 1 TON TOTAL SALES, 1 TON 20,000 20,000 NET INCOME, 1 TON NET INCOME, 1 TON 10,000 10,000 0 0 Nike Nsuka Enugu 3 AVERAGE Imo 1 Imo 2 Ave COSTS & BENEFITS SAMPLE ENTERPRISES, RIVERS STATE 120,000 100,000 80,000 FIXED COSTVALUE (Naira) 60,000 VARIABLE COST 40,000 TOTAL COST 20,000 TOTAL SALES, 1 TON 0 NET INCOME, 1 TON -20,000 lu E i rm ri s go arm AG bu Bo Fa n-O ue -40,000 kF ER wa Um Ba AV ora ok Om Kp International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  14. 14. AVERAGE COSTS & BENEFITS SAMPLE ENTERPRISES, ALL CEDP STATES 100,000 80,000VALUE (Naira) 60,000 FIXED COST 40,000 VARIABLE COST 20,000 AVERAGE TOTAL COST 0 -20,000 SALES FROM ONE TON ER rs r E o A. ia An m C. sa yi u Eb ta En o bra NET INCOME ve Im ug Ed AG AV ve Ab Ibo l on l De ye Ri am Ri BaNot all enterprises are making profit CEDP’s approach to challenges mitigating profit:• Internal group problems • Community analysis before • Conflict resolution• Poor accountability intervention with group members• Breakdown of machines • Part contribution by community • Regular visits • Agroenterprise training • Cross enterprise visits • Equipment maintenance training • Linkages to markets International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  15. 15. Some Challenges• Limited capacity of local fabricators to produce high quality processing machines even though machinery fabrication has been localized in the States• Inconsistent policies• High production costs (manual labour)• Restive youths• Militants• Political problems• Poor infrastructure (particularly in the Niger Delta region)• Internal group disagreements, especially with the management of the MPCs• Enterprises are facing difficulty to sell cassava to flour millers as a result of the non- enforcement of the policy to use 10% of cassava flour in bread International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  16. 16. THE SMALL-SCALE CASSAVA PROCESSING AND VERTICAL INTEGRATION OF THE CASSAVA SUB-SECTOR IN SOUTHERN AND EASTERN AFRICARESULTS/OUTCOMES• Small scale farmers, private investors and NGOs have adopted the HQCP technologies• Project outputs have influenced development of National standards for cassava products by Standards bureau of Project Countries  Madagascar – 4 National Standards Approved (Roots, Starch, HQCF, Chips)  Tanzania - – 4 National Standards Approved (Starch, HQCF, Chips, HCN Analysis)  Zambia– 2 National Standards Approved (HQCF, Chips)• National Committees were formed partly based on the project outputs/experience  Tanzania - Ministerial Committee on Cassava Development  Committee on Standards for Root and Tubers and their by products  Zambia - Technical Committee on Standards for cassava products  Madagascar - National Committee on Standards for cassava products International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  17. 17. Musa - Bungu GroupInternational Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  18. 18. UTILIZATION OF CASSAVA CHIPS IN ANIMAL FEED IN THE ECA REGIONRESULTS• 8 farmer groups sensitized on production of high quality chips• 9 local fabricators were trained on chipper fabrication + 15 local artisans trained in machine operation and maintenance, drier construction and warehouse maintenance.• The introduction of combined improved processing methods reduced on moisture retention, aflatoxin contamination and cyanide toxicity after chips drying, while bag stacking on the wooden pallets reduced on moisture uptake/pickup, aflatoxin contamination, insect damage and discoloration of dried cassava chips during storage• Increased use of improved technologies for processing high quality cassava chips in the region International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  19. 19. • Well-organized and positioned market-oriented farmer groups with market linkages in place• Heightened positive farmers’ attitude and enthusiasm towards cassava as a high income crop• Improved product quality, reduced processing cost, increased product value (Uganda: increase of 20-26% in product value; ave. 37.5% Gross Margin) International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org
  20. 20. Abass, A.; Asiedu, R.; Davis-Mussagy, M.; Ntawuruhunga, P.; Okechukwu, R.; Sanni, L.; Tarawali, G. International Institute of Tropical Agriculture – Institut international d’agriculture tropicale – www.iita.org

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