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Value Chain Development Training Report

Background

 

State Partnership for Agriculture (SPA) Agricultural policies in Kaduna, Benue, and Kogi States are being fundamentally transformed with an increased focus on proactive and strategic investments. 

 

A critical element of this transformative agenda is prioritized funding for activities along the innovation continuum that will increase productivity, reduce costs, State Partnership for Agriculture (SPA) Agricultural policies in Kaduna, Benue, and Kogi States are being fundamentally transformed with an increased focus on proactive and strategic investments. 

 

TechnoServe Nigeria (TNS) in collaboration with Synergos, with funding support from the Bill and Melinda Gates Foundation (BMGF) under the State partnership for Agriculture Project (SPA), conducted a 2-day training (May 30th – 31st, 2018) on Value Chain Development at Sawalino Hotel, Keffi- Nasarawa State. Participants comprised actors in the agricultural sector from the academia, Ministry of Agriculture and related departments and agencies, and representatives of Agricultural coalitions/Agricultural unions across three States – Benue, Kaduna and Kogi. The sessions were facilitated by Staff of Ikore consulting, the consulting firm contracted by TechnoServe Nigeria for this exercise.

 

The training objectives were to:

  1. Deepen participants’ understanding of Agricultural market dynamics
  2. Reinforce participants’ knowledge of relationships between different players in the agribusiness space with a view to making markets work for the poor.

Participants’ introduction began proceedings for the day, along with setting of ground rules, stating expectations of participants, the meeting’s objectives and a pre-test to ascertain knowledge of participants before the training. Most of the participants desired to get a better understanding of value chain development, learn agribusiness best practices from other attendees and network with fellow participants as captured in their expectations.

The country Director of TechnoServe, Mr Larry Umunna in his opening remark commended the group on their experience in their various work roles and highlighted the need for the training in the State partnership for agriculture project. 

Mr. Danbaba – the head of Agriculture at TNS – in his opening remark, applauded the multi-sectoral composition of the participants, highlighting the importance of cross-learning and collaboration across the agri-business landscape. He touched on the need to scale the State Partnership for Agriculture (SPA) model beyond the three states where it is currently being implemented to optimize the potentials of the intervention’s gains nationwide. 

The technical session of the day began with the topic, “Agriculture as a Business”. Participants were tasked with sharing their understanding of the Phrase – Agriculture as a Business, while all the participants alluded to the fact that Agriculture is a business, some participants stated documentation of agricultural transactions and processes for record keeping purposes, value addition for optimization of products and returns on investment as proof that agriculture is truly a business. Following experiential sharing by participants, the facilitator stressed that every business has key elements that characterize them as such and these elements are evident in agriculture, e.g. strategizing, investing, documentation, profit making etc. The role of government in agriculture and its achievement thus fare was also deliberated upon. Participants listed the following as government’s role:

  • Creating enabling environment, through Policy formulation and provision of infrastructure
  • Subsidy provision

Some participants expressed concern over subsidy provision, stating that such practices have not been favorable since only few farmers benefit from such a scheme. One of the participants lamented the exclusion of key stakeholders in policy design and operationalization as the bane of the agricultural sector. Overall, participants agreed that government has not fared well in supporting the agribusiness. Factors such as poor infrastructure, insecurity and multiple taxation were the major reasons why the government was found wanting by the participants.

It was agreed during the session that due to governments lack of political will to address most of the challenges in the agricultural sector, stakeholders should identify opportunities of comparative advantage, address challenges within their control to optimize their profit. Participants also discussed reasons why Nigeria is under producing agricultural products compared to countries of similar size, some of the reasons mentioned and discussed were:

  • Lack of government support
  • Poor investment in research and development
  • Myths and misconceptions e.g. farming is for the poor
  • Low-scale mechanized farming 

Some common challenges affecting agribusiness were also discussed, namely:

  • Small-scale, high price of inputs.
  • Uneasy access to land.
  • International labor migration.
  • Vulnerability to mother nature, and other farm level risks
  • Poor infrastructure- storage, transportation
  • Inadequate or weak policy environment (unfavorable policies)
  • Lack of finance
  • Lack of extension services
  • Google farming
  • Big farm syndrome

 

The session on “Introduction to Value Chain development” began with an exercise that saw participants defining terms relevant to value chain development. Most of the participants were conversant with these terms, nonetheless, the facilitator assisted with appropriate wording of definitions by some participants. This very interactive exercise availed participants an opportunity to deepen their understanding of terms they regularly use but sometimes out of context. Following definition of terms, some participants were given a piece of paper containing a component of Rice value chain to demonstrate their understanding of the interrelatedness of these various components. The participants with these pieces of paper were expected to stand next to the preceding component of the value chain to simulate a Rice value chain map. The exercise revealed a high level of understanding of the rice value chain by most of the participants, with only 2 participants wrongly placed on the value chain map. The facilitator leveraged these exercises to illustrate the importance of understanding value chain framework and interrelatedness of each component for optimization of output. Broadly, the value chain map demonstrated, consisted of:

Input supply          Production           Post-harvest          Processing         Market         Consumer

Participants were split into four groups to develop value chains for Cassava, Ginger, maize and Sorghum respectively. After 10mins, group leaders presented their value chains at plenary revealing several actors, interrelatedness of components and multi-directional flow of products to different market segments, ultimately showcasing the dynamism of the respective markets. Clarifications were made by the facilitator on the flexibility of value chains, owing to varying context.

The session on Value Chain development dovetailed into “Value Chain Competitiveness”. During the discussions, participants attempted to define value chain competitiveness. The facilitator highlighted focusing on areas of comparative advantage in any value chain as a major determinant of competitiveness. He further stressed Cost of product, differentiation of product and focus of consumers as key elements that promote value chain competitive advantage in the agribusiness. 

The definition of value chain competitiveness was agreed to be “The ability to optimize your competitive advantage – linking your competitive strategy (your competitive priority of time, cost, quality and flexibility) to your value chains for sustained growth of the business/industry”. The following factors were identified to affect competitiveness:

  • End market
  • Global business enabling environment
  • Local, National and regional bee
  • Vertical linkages
  • Horizontal linkages
  • Supporting markets
  • Relationships
  • Upgrading
  • Value Chain Governance

 

Value chain Coalition and Benefits to Stakeholders” presentation brought the technical session of day 1 to an end. The session focused on differentiating between coalition and team, highlighting coalitions as interest/reward focused while teams are role-focused. The facilitator further explained the types of coalitions as:

  • Horizontal; between similar entities on the value chain
  • Vertical; between entities on different levels of the value chain

The importance of coalitions was also discussed, with the participants agreeing that Coalitions result in “Power”, to influence the dynamics of the value chain. If wielded rightly, would result in the Power to lobby policies, drive change and growth in the sector. Participants were tasked with analyzing the impact of value chain coalitions in their states, which would be submitted the next day.

 

In concluding the day’s activities, Participants were asked to share their “Aha” moments. Three major points stuck out for the participants generally, viz:

  • Existence of gaps/opportunities in every value chain that can be optimized for business purposes
  • Deepened understanding of value chain framework and terms
  • Viability and diversity of the agribusiness

 

The head of Agriculture at TNS commended participants for actively taking part in the training during his closing remarks. He thanked everyone present for contributing to a successful first day and encouraged timely commencement of day two’s activities.

 

Day Two (31st May, 2018)

Day 2 Started with an opening prayer by a Muslim and the day ended with a prayer from a Christian. A recap of what was done the previous day was facilitated by the two facilitators. Volunteers from each table highlighting what was done in summary. This was followed by a review of group assignment on” value chain coalition and benefits to stakeholders” shared among the participants from different States the previous night. The assignment happened to be a very key area for all the participants as all the participants contributed intensively to an extensive discussion because of the different crops dominant in the different States.

Kogi had Cashew and Cassava while Kaduna did on Maize and Benue did on Cassava. The overall outcome. Kogi was asked to do more work on Cashew since they had more experience in Cashew. Kaduna was asked to do more work in Ginger as they had more experience in Ginger. The assignments were pair reviewed so that learning by other members of the class can learn. The exercise provided a forum where States that do not have enough experiences on Cashew and Ginger could learn while experiences about Cassava and Maize which is cultivated/cross cutting crops among the three State was shared for learning from the different perspectives of the three States. The assignments review created a lot of meaningful discussions among the participants as different views and experiences were brought to bear from their experiences. 

Day 2 Activities did not commence until after lunch because of the extensive discussions on the value change coalition and benefits to the stakeholders. The first module for the day was on “Quality control in value chains. Major discussions on the module was centered around the importance of ensuring quality from the beginning of the chain to the end users as use of poor quality seedlings and even poor soil preparation can slow the work, downtime, system breakdown, and even result in stoppages. The take home from the module was that quality should be ensured at every stage in the chain for maximum yield and profit and most importantly buyer satisfaction.

The second module on “Introduction to risk management” looked at what risk management is, the types and sources of risks. Underlining risks within the different stages in the chain was discussed. It was made clear that there are different risks from production, price, political, institutional and human/personal risks and made clear to the participants as different knowledge and experiences from all the participants and the facilitators were shared. The participants were also equipped with not just the different possible risks but the specific victims along the value chain and the various risks can be managed with specific ways of handling the risks which ranges from risk avoidance, reduction retaining and sharing. Formal and informal risk management strategies including the steps in risk management plan measures were established. The high point of the module was on how to mitigate risks in Agric value chain. This was considered the high point as the best of each chain and profit can be fully maximized if the risks are well mitigated. This is because if the risk is mitigated from the early stage through all the stages, optimum profit and satisfaction both for consumers and the farmers including other key persons along the chain will be achieved thereby other intending individuals along the chain and youth will have evidence which will encourage them to join in any chain they wish to be part of.

Access to finance and insurance was the module 7th. This module attended to the number one need of every person along the chain including the available insurance which anyone on the chin can take advantage of. The module broadened the knowledge of everyone on the chain as insurance which is not taken as a culture of the average farmer was made clear. The average Nigerian is always afraid of risks associated with each chain which ranges from unfavorable weather, accidents, inflation, theft etc. Another key challenge is lack of awareness and knowledge of the availability of finance or credit facilities, loans insurances etc available for each level on the chain. The module highlighted the available options and access which exist that anyone can access on the chain. The NIRSAL participant shared more light on the availability of a loan/facility which the participants can take advantage of. He shared three contacts of the link officer they can meet in the three States – Benue, Kaduna and Kogi.

The final module on Gender and youth engagement aimed to Increase participants understanding of why gender is important to value chains and development, Analyze the gender-related factors affecting inclusion, Foster understanding of constraints to youth engagement and ways of increasing their participation in value chain activities and Explore strategies to promote gender inclusion in value chain activities.

Key concepts like Gender, Gender roles, Gender analysis, Gender discrimination, Gender equality, youth engagement were identified. The benefit of of gender inclusion and youth engagement were also highlighted.

The facilitator shared the importance of ensuring gender mainstreaming along the different chain as the stereotypes picked from the different cultures and traditions deprives the different players in the different chain from taking advantage of the opportunities along the different chains for coalitions. Some stereotypes which discourage female gender access to land, finance, capacity building was seen to discourage coalitions along the different chain which hinders progress. Examples of how gender issue deprived different group of people along the chain were shared. The highlight of the module was the eye-opening discussions on the importance of coalitions which gender issue had deprived the different people and operations along the chain and the opportunities available if the gender imbalance issue can be neglected and gender equality and equity be embraced.  In the last module, Gender inclusion and youth engagement in the value chain, Participants were asked in their groups to identify activities of women and youths in agricultural value chain activities.  

The training ended with an admonition from the agribusiness Specialist of TechnoServe, Mr Kenneth Okonkwo encouraging everyone to take advantage of a seed planted which yields hundreds and thousands. He likened the popcorn to the expected impact of each participant, going back home to step down what has been learnt and encouraging the youth through sharing the profit for them to be encouraged and begin to be attracted to the profit from each of the value chain, so they begin to be interested. 

In concluding the day’s activities, Participants were asked to take the post test, the questions were read out to them and the answers to enable them access their learning.