RSA6 - Value Chain, Markets and Policy
Unlocking new market growth
Lead: Vanya Slavchevska and Jonathan Newby
Collaborators: Imran Malik, Erik Delaquis, Wilmer Cuéllar
- Australia: Australian Centre for International Agricultural Research (ACIAR); University of Queensland
- Cambodia: Cambodian Agricultural Research and Development Institute (CARDI), General Directorate of Agriculture (GDA)
- Colombia: Universidad Nacional de Colombia (UNal), ASOMUSACEAS
- Indonesia: Indonesian Legumes and Tuber Crops Research Institute (ILETRI), Brawijaya University (UB)
- Lao PDR: National Agriculture and Forestry Research Institute (NAFRI), Dept of Agriculture Lao PDR (DOA), The Plant Protection Center (PPC)
- Myanmar: Ministry of Agriculture, Livestock and Irrigation (DOA-MYANMAR), Dept of Agricultural Research (DAR)
- Thailand: Kasetsart University (KU), Dept of Agriculture Thailand (DOA)
- Vietnam: Agricultural Genetics Institute (AGI), Institute of Agricultural Sciences for Southern Vietnam (IAS), Field Crops Research Institute (FCRI), NOMAFSI, Tay Nguyen University (TNU), Michigan State University (MSU)
- The International Institute for Rural Reconstruction (IIRR) for the COVID-19 survey in Cambodia.
RSA-6 understands the production process and cost related to each element of the production chain to add value to cassava products in LAC and ASEAN regions.
This RSA brings cross-cutting support to the Cassava Program, guiding it in fulfilling its mission by helping to set research priorities to better assess different stakeholders’ and end users’ demands and needs; to identify market opportunities and production and consumer trends; to develop business models inclusive toward poor farmers, women, and youth; and to generate evidence of the program’s outputs and impacts.
The RSA-6 team examines the production process and costs related to each element of the production chain in search of ways to add value to cassava products in the Latin America and the Caribbean (LAC) and Southeast Asia (SEA). RSA-6 provides the Cassava Program with cross-cutting support, based on a thorough understanding of Asian cassava markets, the value chains of smallholder cassava producers and partnerships. In addition, by collecting valuable data on cassava farming households through different surveys implemented in SEA, we generated evidence of the program’s outputs and impacts.
"Asian cassava market update" (Jonathan Newby)
Cassava markets gave mixed results in 2020, varying according to the geography and products, especially in the context of the COVID-19 pandemic. However, many other global factors impact these and related commodity markets – particularly in Asia, which remains the focus of the cassava market. Since the outbreak of COVID-19, commodity flows have been altered by a range of trade policy shifts together with outbreaks of animal disease (African swine fever) as well as crop pests (FAW) and diseases (CMD). Many market and trade developments have occurred in China, which remains the main destination for cassava from SEA. China’s overall import growth has been one of the main contributors to trade resilience during the pandemic and to strong market prices for cassava in SEA. As the FAO reported in 2020, unabated import growth was not caused by the outbreak of COVID-19 in China but took place despite the ensuing global health crisis (FAO, 2020).
Trade in cassava products includes cross-border trade in fresh roots, cross-border and regional trade in dried cassava chips, and global trade in cassava starch. While the global cassava trade remains a multi-billion-dollar industry, the aggregate value of traded roots, chips and starch declined by around 0.5bn USD during 2018-2019. This was largely driven by lower demand for cassava chips in China. Global trade in cassava products remains dominated by Asia as both the major source and destination. In 2020. there was some recovery in the volume (27%) and value (33%) of cassava chips exported from Thailand into China. This trend is expected to continue into 2021, as the derived demand for cassava chips increased due to increasing maize prices in China. Starch exports declined slightly (-2%), reducing export value by around 6.5%. Higher starch prices have caused exports to Indonesia to decline significantly, as processors seek alternative feedstocks for applications that are easier to substitute between starch types – that is, toward maize.
Elevated root prices are a factor of both supply shocks and trends coupled with a significant increase in the derived demand due to the maize situation in China. The supply of cassava is likely to increase in the coming season, with farmers changing from other annual crops to cassava, involving in some cases the conversion of perennial crops. The frontier is also likely to come under pressure, with expansion into forested areas where regulations are not enforced. Increased production is also likely to influence the flow of planting stems and the spread of disease into new frontier regions.
ACIAR Value Chain and Livelihood Program concludes
The production and marketing of cassava by smallholder farmers is part of a complex global value chain influenced by many factors outside the control of farmers or other actors within these countries. However, despite price fluctuations, the sector contributes significantly to the livelihoods of smallholder farmers engaged in the industry, leads to economic development in rural communities and contributes importantly to national economies.
The ACIAR Value Chain and Livelihood Program posed the question of whether the productivity and sustainability of smallholder cassava production could be enhanced by strengthening market linkages and thus accelerating the spread of improved technologies. In search of answers, the program used cases study sites in Vietnam, Indonesia, Laos, Cambodia and Myanmar. The results indicate that in reality the potential for scaling out varies significantly between technologies and in the different production and value chain contexts.
The evidence further indicates the high likelihood of generating better practices for new varieties, while underlining the importance of new models and partners to generate changed behavior with respect to fertilizer as well as the need to work with farmers for redesigning technologies aimed at minimizing land degradation to ensure that these match farmers’ priorities and preferences. In some cases, the constraints that need to be addressed are not directly related to the technology itself. In other cases, there is a clear need to continue to invest in technology development and refinement with farmers and other stakeholders.
Regardless of the technology or value chain context, there was an evident need for the creation of partnerships between public and private sector actors, and also for better coordination between these actors, ministries and development partners. The requirements for partnering with the private sector are summarized below. The “key conditions” listed can be regarded as provisional generalizations arising from the cross-case analysis and are not intended as a simple recipe for knowledge partnerships. As we have emphasized, there are many case-specific factors that restrict our ability to make such firm generalizations. Nevertheless, these key conditions can serve to delimit situations where private-sector partnerships are more likely to succeed.Key conditions for effective knowledge partnerships with private-sector actors, based on results of cassava case studies:
- A fund of adoptable technologies (ie with moderate to high relative advantage and learnability) requiring no more than local adaptation
- A commercially oriented farming population, experienced in repeat-dealing with stable agribusinesses
- An articulated value chain that establishes strong, enduring links between farmers, traders and processors
- A market structure OR industry regulation that assures agribusiness actors of capturing the benefits of investing in improved farm productivity
- Absence of policy constraints, such as distortions in fertilizer pricing or sudden changes in cross-border trade restrictions
- Involvement of a knowledge broker to catalyze and support the partnership (eg a public agency, a university, a development project or an NGO)
- Individual actors with the interest and capabilities to pursue these partnerships
Collecting evidence of impact (Vanya Slavchevska)
The team registered several noteworthy achievements in 2020, despite the challenges posed by the global pandemic, with interruptions or delays in some activities. The team collected a nationally representative panel survey of cassava farmers in Vietnam with funding from CRP-RTB. The survey, which was applied to the same cassava farming households interviewed by CIAT and Vietnamese partners in 2015 (Le et al., 2019), collected information on a wide range of key topics around cassava production and value chains, including agricultural practices and technologies, productivity, disease pressures, livelihoods, experiences of shocks, impacts of COVID-19, gender and youth entrepreneurial issues. DNA fingerprinting and disease surveillance were also carried out. The survey data will be used by the whole Cassava Program to analyze a wide range of issues.
Global value chains, such as that of cassava, are improving incomes and enabling many smallholder farmers in developing countries to escape poverty. However, they are often criticized for exposing farmers with limited access to insurance or credit to significant income shocks. To increase our understanding of cassava as a pathway to prosperity, it is critical to also understand how smallholders are impacted by global shocks, such as COVID-19. In 2020, the team was awarded a competitive grant from CRP-PIM to carry out an assessment of the impacts of COVID-19 on cassava value chains and cassava farmers’ income and food security in Cambodia and Vietnam. The study, to be published in 2021, found that cassava value chains were minimally impacted by COVID-19, but its impacts on cassava farmers differed in the two countries. There were larger negative impacts on cassava farmers in Cambodia than in Vietnam, which could be attributed in part to Cambodian farmers’ higher livelihood vulnerability, a scarcity of domestic starch processors and ad-hoc cross-border restrictions, which led to distress early selling of cassava to cope with the crisis. Vietnamese cassava farmers experienced small negative effects from COVID-19 because of support from processing facilities located within the country.
Increased commercialization and globalization of cassava value chains in SEA have important social implications, including on local norms, gender relations and opportunities for women and men to participate in and benefit from globalized value chains. To promote shared benefits and gender equality, it is critical to identify constraints and opportunities for women and men in the globalized cassava value chains, specifically around access to inputs. This is the focus of an 18-month project with CIP, co-funded by CRP-PIM and CRP-RTB, which started in 2020.
With the aim of helping build the capacities needed to develop gender-inclusive value chains and interventions in value chains, the team contributed to the development of several publications on gender-responsive pest and disease management, which offer guidance in making technological innovation tools more relevant for diverse actors. The publications included a guide, a perspective article and a blog on gender issues in pest and disease management with case studies from cassava, other roots and tubers as well as bananas. In addition, guidelines were developed for mainstreaming gender in the use of willingness-to-pay (e.g., for planting material of different qualities) tools. Gender and social inclusion issues were also mainstreamed in a user guide to experimental auctions of vegetatively propagated seed.
- Andrade-Piedra JL, Almekinders CJM, McEwan MA Kilwinger FBM, Mayanja S, Delaquis E Garrett KA, Omondi AB, Rajendran S, Kumar PL, Thiele G (2020) User guide to the toolbox for working with root, tuber and banana seed systems. RTB User guide (RTB User Guide No. 2020-1). CGIAR Research Program on Roots, Tubers and Bananas (RTB), Lima, Peru. Doi.org/10.4160/9789290605577
- Kawarazuka N, Damtew E, Mayanja S, Okonya J S, Rietveld A, Slavchevska V, Teeken B (2020) A gender perspective on pest and disease management from the cases of roots, tubers and bananas in Asia and sub-Saharan Africa. Frontiers in Agronomy 2:7. https://www.frontiersin.org/articles/10.3389/fagro.2020.00007/full?utm_source=F-NTF&utm_medium=EMLX&utm_campaign=PRD_FEOPS_20170000_ARTICLE
- Kawarazuka N, Damtew E, Mayanja S, Okonya JS, Rietveld AM, Slavchevska V, Teeken B (2020) Considering gender in pest and disease management: FAQs for gender-responsive data collection and extension work. Lima, Peru: International Potato Center. 4p. https://cipotato.org/publications/considering-gender-in-pest-and-disease-management-faqs-for-gender-responsive-data-collection-and-extension-work/
- Newby J, Smith D, Cramb R, Delaquis E, Yadav L (2020) Cassava value chains and livelihoods in South-East Asia, a regional research symposium held at Pematang Siantar, North Sumatra, Indonesia, 1-5 July 2019, ACIAR Proceedings Series, No. 148, Australian Centre for International Agricultural Research, Canberra
- Newby J, Smith D, Cramb R, Le Thuy CT, Youabee L, Sareth C, Tanthaphone C, Soperith S, Hadiutomo W, Dũng LV, Văn Nam N (2020) Can the private sector help deliver improved technology to cassava smallholders in Southeast Asia? Knowledge Management for Development Journal.
- Slavchevska V (2021) Inclusive tools for collecting data on women's and men's willingness to pay for seed [tools]. https://hdl.handle.net/20.500.11766/13038
- Le P D, Labarta A R, Haan de S, Maredia M, Becerra LA, Lien TN, Ovalle T (2019) Characterization of cassava production systems in Vietnam (Publication No. 480). Retrieved from https://hdl.handle.net/10568/103417