Market Assessment

Analysis of the mango value chain in Ethiopia, World Vision 2008

    Description
    World Vision wishes to develop the mango subsector via smallholder farms in Homosha and Assosa Woredas (together referred to as Assosa) in western Ethiopia. This paper provides a mini-report on the findings of a mango Value Chain analysis study conducted between September and December 2008, through desktop and field research involving chain operators, enablers and supporters in Assosa. The study found that the mango sub-sector is a good entry point for tackling poverty in Assosa and that the market for mangoes in Ethiopia is significant and growing.

    Summary of results
    Though the immediate market is small, there is a short and established value chain linking to Addis Ababa via a 700 km trip. Typically, Assosa exports between 150-300 (10-ton) truckloads of fruit per season to other regions, principally Addis Ababa. In spite of the high cost of imported fruit, nationally the volume has risen by 100% in the last seven years, while that of imported juices has more than doubled in the last four years, evidence of an up-scaling market. The farm-gate price of mangoes in Asossa ranges from 0.25 to 1.15 Birr/kg while the retail price is approximately 5 Birr per kg in Addis, compared to 10 Birr per kg of other imported whole fruits. Farmers typically achieve approximately 5 to 8% of the final retail price (at lower levels) giving them about 1,400 Birr in annual income, while wholesalers get about 30% of it but meet the high transport costs.

    Analysis reveals a reasonably resilient subsector with a favoured market position of the 'Assosa mango' regional brand. Also, the region appears to have a comparative advantage with ideal growing conditions for mangoes and high yielding trees. At the production level however, the value chain is quite rudimentary with mainly subsistence level cultivation, harvesting and post-handling techniques that limit the quality of the fruit. Upstream there are also issues with most grading and packaging being undertaken following a long road journey to the capital, undermining not only the quality of fruit but also the potential value generated at the farmer level. At the wholesale level in Addis Ababa, market traders dominate the landscape and operate in ways that make it difficult for new entrants to enter the market. Addis wholesalers have strong relationships with the traders based in Asossa and these two levels of the value chain account for most of the final retail price. Given the roles they play, it appears that there is not a proportionate addition of value in the chain, and that is where opportunities lie for improving farmer level value capture in the chain.

    The mango value chain can spur development in Assosa, introduce technologies, create employment and reduce poverty among the communities. This can be achieved if value chain integration is phased, targeting beneficiaries for different interventions, and working with other development agencies. Interventions should promote land acquisition and ownership and integrate other crops and livestock for food security. Farmers need to become organised through cooperatives and undertake value adding activities at the local level, such as grading and packaging. The Asossa Agricultural Research Institute should begin cultivation and extension of improved commercial varieties for longer term planning. Grafted tree nurseries should be targeted for support, complemented with mother gardens. Extension services to the community need to be improved throughout the sector to enhance the technical education and understanding amongst farmers. Existing trees should be top-worked, spatially concentrating varieties to facilitate marketing. The landless should be targeted and positioned to provide auxiliary services to the value chain. Local providers should be capacitated to serve the sector. A mango stakeholder platform should be instituted. Input dealers should be linked to growers, all supported with business development and research services. Processing should start at zonal level then progress to regional level. Further work on characterisation of existing trees and product development is recommended. In the longer term, the sector should consider higher value export markets.