Scaling Up Agricultural Value Chain Development In Nigeria (1)

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 A ‘value chain’ in agriculture identifies the set of actors and activities that bring a basic agricultural product from production in the field to final consumption, where at each stage value is added to the product. 

A value chain can be a vertical linking or a network between various independent business organisations and can involve processing, packaging, storage, transport and distribution. 

The terms “value chain” and “supply chain” are often used interchangeably. 

Traditional agricultural value chains are generally governed through spot market transactions involving a large number of small retailers and producers. 

Modern value chains are characterized by vertical coordination, consolidation of the supply base, agro-industrial processing and use of standards throughout the chain. 

A value chain encompasses the flow of products, knowledge and information, finance, payments, and the social capital needed to organise producers and communities. 

Information is especially important to all value chain actors and flows in two directions: markets inform producers of price, quantity and quality needs, product handling and technology options, while producers inform processors and markets on production quantities, locations, timing and production issues. 

In a value chain, processors and marketing agents may provide producers with finance, inputs and training in technologies of production. 

Value chains may include a wide range of activities, and an agricultural value chain might include: development and dissemination of plant and animal genetic material, input supply, farmer organization, farm production, post-harvest handling, processing, provision of technologies of production and handling, grading criteria and facilities, cooling and packing technologies, post-harvest local processing, industrial processing, storage, transport, finance, and feedback from markets. 

The rapid globalisation of the Agricultural markets has led to the generation of new production and distribution systems, as well as new consumption patterns. 

One of the objectives of modern agriculture is to reduce to the barest minimum the problems associated with agricultural loss, wastages and output underutilisation by ensuring an efficient optimization of all the linkages between the producer and final consumer through the “Value-Chain” concept. 

There is oftentimes no differentiation of farming activities which resultantly shields the benefits that could have accrued from trade specializations. 

The sustained efficiency in the agricultural industry of the developed nations is hinged on the principle of specialised diversification through the value chain. Here, each of the producers, processors, marketers and researchers focuses on his enterprise as one’s output is another’s input, ensuring quality delivery of resources to the next link without encroaching into other production niches. 

In Nigeria, attention is mostly focused on primary production; huge crop turnover/harvest, large flock management, enormous plantations. 

Nigerians pride themselves in being the world’s largest producer of cocoa, third largest producer of sorghum, largest producers of yam and cassava, and cultivators of the great monumental groundnut pyramid. 

The enigmatic question here is: despite our seemingly agricultural feats, why is the agricultural industry not regarded as developed? Production efficiency which could have been realised from the processing of our massively harvested crops is lost; for example, cocoa beans are exported unprocessed and are transformed into varied products such as beverages, chocolate bars and candies to mention, but a few which are in turn imported into the country and sold to us at increased prices. 

Appreciable economic gains will accrue to the nation if there are policies to guide against exporting raw crop produce; which will strengthen the value addition process and encourage investment in such areas of the economy. 

Governments all over the world are interested in the potential of value chains to develop agriculture and contribute to food security, and this has been on the rising since the 2008’s global food crisis. 

Nigeria through the Agricultural Transformation Agenda, according to Dr. Mohammad Mahmood Abubakar, Minister of Environment, has currently implemented policies to strengthen the players of the value chain mix and revolutionise agriculture as a business entity. 

“Agricultural value chains hold considerable promise in reducing poverty and promoting inclusive growth when the poor and other marginal groups participate in them. 

“Under the right conditions, value chains can move smallholder farmers from subsistence into commercial agriculture, this is where Nigerian Agricultural business is heading to irrespective of the challenges both natural and man-made it has faced over the years”, he said. 

Factors Needed For A Successful Agricultural Value Chain 

Enabling Environment: Nigeria has over the years tried to revamp agriculture using different approaches to boost production. 

However, recent developmental programs are geared towards maximising income not only on production but also on processing and other areas, (Agricultural value chain). For the effectiveness of the Agricultural value chain, an enabling environment through national policies, regulations, and supporting institutions are a prerequisite. Policy reforms relevant to the value chain approach focused on the following should be considered: – 

• Increasing private sector participation (Cooperate organizations and Individuals) 

• The quality and safety standards of agricultural products 

• Improving institutional and financial frameworks. 

• Promoting national policies that support the agricultural sector; by reducing barriers to inputs, increasing access to finance and providing incentives. 

For instance, the ban on rice importation since the inception of this administration paid off. 

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Source: Daily Independent

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