ICT Update's List: Value chains

This webpage is maintained by the organisation Research Into Use: it introduces the value-chain concept and how it compares to traditionnal approach to selling system in developping countries. The webpage has diagrams, concept definitions,examples, references and links to resources on 'value-chains'. A good starting point to learn more on the subjet of VC.

Concentrating on a selection of 30 donor-led value chain interventions, the review finds two main patterns of engagement: (a) one which funnels assistance by partnering with lead firms in the value chain - lead firm projects; and (b) one which works with chains without a lead firm - value chain linkage projects. Targeting of the poor seems more effective in value chain linkage projects and in those lead firm projects where beneficiaries are identified in both the chain's suppliers and distributors.
Controversially, despite a wealth of positive anecdotal evidence, the vast majority of projects did not carry out an impact assessment of their poverty alleviation objectives and it is therefore unclear whether the value chain intervention: (a) is responsible for the improvements observed; (b) benefits the poor disproportionately; and (c) is more cost effective than other alternative approaches. Assessing the poverty alleviation effects of individual interventions in a rigorous way is costly and challenging but necessary to ensure long term effectiveness of the interventions as well as optimising the use of public funds.

Understanding how to link poor producers successfully to markets, and identifying which markets can benefit what kinds of producers, are critical steps for the development community.
Formal markets have requirements - including quality, consistency, traceability, food safety and third-party certified standards (Fairtrade, Rainforest Alliance) - that necessitate direct communication and coordination along the supply chain. While these requirements of formal markets raise the barrier of entry for new producers, particularly those with fewer assets, they also present potential opportunities for diversification, income generation and professionalization. Some poor households can benefit from participation in formal supply chains not just as smallholder producers, but also as wage laborers in production or processing, and as providers in the service markets that support value chains. The purpose of this paper is to draw together preliminary conclusions and open questions based on experience of IIED and a broad literature review of the impact of participation in formal value chains on the livelihoods of poorer producers. This is a critical topic for donors and NGOs as they consider the effectiveness of investment strategies.

This new English version of the methodological tool kit developed by CIAT's Rural Agroenterprise Development Project (Centro Internacional de Agricultura Tropicahas / Reprint edition published by Catholic Relief Services, Baltimore, 2008) (109 pages) has been extensively updated based on feedback. The goal of this work is to enable service providers to empower rural communities with skills to engage more effectively in the marketplace so as to increase their income, their CAPACITY TO INNOVATE and ultimately improve their livelihood options.

"Food value chains (FVCs) comprise all activities required to bring farm products to consumers, including agricultural production, processing, storage, marketing, distribution, and consumption. FVCs are changing rapidly in developing countries (DCs), because of population and income growth; urbanization; and the expansion, globally and domestically, of modern food retailing, distribution, and wholesaling firms (1, 2). One such change is that consumers and regulators increasingly demand product-specific characteristics beyond price-including nutrient content; food safety certification; and indicators of impacts on natural resources, greenhouse gas emissions, and farmworkers. To accommodate these multidimensional demands, regulators and firms are developing new multiattribute product labeling and production standards. We outline below ways in which scientists must integrate existing disciplinary evidence into rigorous models and must develop measures and methods to evaluate the multidimensional performance of FVCs. "

"The Agricultural Development and Value Chain Enhancement Programme is to carry out a Geographic Information Systems (GIS) mapping exercise of rice, soya and maize fields in the Northern, Upper East and Upper West regions."

Artcile abstract: The concept of a Value Chain has existed for twenty years but we find it still is an unclear concept. It has been suggested that the third generation supply chain is based on customer intimacy and is fully synchronized. In this paper, the authors discuss the need to relate the concepts of the value chain and the supply chain in a more comprehensive and integrative manner. We begin with a discussion of value and the development of the concept of value chain. We then discuss similarities and differences of the value chain and the supply chain, and conclude with suggestions regarding the need for synchronizing value and supply chains to optimize business performance.

This paper has been produced by the Trade and Market Division of the FAO in 2007. It was compiled in the light of significant changes which are taking place in the value chains for many agricultural commodities, particularly those fresh products destined for supermarket shelves. The changing pattern of these value chains has important, but not well understood, implications both for domestic policy in producing countries and for international trade.

Agricultural Economics Research Review; Vol. 24 January-June 2011 pp 169-181.
This paper is a synthesis of many presearch oprojects on value chains for small holder and poor farmers in India. The last chapter in dedicated to research on the role of ICTs in enabling value chain positive development (with example from India).

"Zambian honey producers in the districts of Kasama, Kaputa and Kaoma will work with Personal Digital Assistants (PDAs) to sell their products abroad more easily. The PDAs will be used to collect, store and analyse key data about Zambia's honey sector. This will make it easier for honey producers to get their products certified which, in turn, will allow them to sell their honey on the international market. "

"ABIS is a web based information system developed by RADA to provide information on crops, livesock and agricultural production, markets and stakeholders to support the business of agriculture. Its goal is to provide information appropriate to boost the capacity and competitiveness of stakeholders (primarily farmers) and provide better measurement of capacity and performance to Government". ABIS has been featured in ICT Update #9.

The Royal Tropical Institute (KIT) promotes pro-poor VC4D - Value Chains for Development - approaches in agricultural and rural development in the South. This website is the KIT Information portal to everything VC4D.

On May 19, 2011 Judy Payne presented "Using ICT to Increase Impact of Agriculture Sector Development." The seminar was the 59th installment of the Linking Small Firms to Competitiveness Strategies Breakfast Seminar Series sponsored by the USAID Microenterprise Development office. This presentation serves as a good (and recent) source of ICT4VC context, issues and solutions.

An illustrated guide from the Rural Market Intelligence Project from i-network (the project ended in automn 2010, but this guie explains in clear steps how farmers can better acces market information in Uganda.

The USAID FACET Project (Fostering Agriculture Competitiveness Employing Information Communication Technologies) project has created a series of Briefing Papers designed to help USAID missions and their implementing partners in sub-Saharan Africa use information and communications technology (ICT), through sustainable and scalable approaches, more successfully. This briefing paper focuses on ICT applications that provide market price information to those within agriculture value chains.

"The author of the report collaborated with a rural coffee cooperative in Guatemala to design and evaluate two camera based application to automate procurement and monitoring activities."

The most widespread information and communication technology (ICT) in developing countries today is the mobile phone. The majority of people in the least developed countries still live in rural areas and their livelihood depends on the primary industries. This study investigates the use of mobile phones among farmers in rural Tanzania in order to supply empirical data on the developmental role of this technology. The results show that the improved access to communication and information that mobile phones represent affects the entire cyclic farming life during the year and has resulted in considerable changes in the entire livelihood constructs, increased opportunities and reduced risks for rural farmers.

Zambia’s AMIC suffers from a range of weaknesses all along the supply chain for price information. Data collection and transmission is irregular and unreliable, data management is unstructured and lacks strategic oversight, and dissemination is entirely supply-driven. The primary reasons for AMIC’s weak performance are competing priorities and a misguided incentive structure for staff at the national, provincial, and most importantly at the district level, where the viability of the collection process depends on reciprocity between price collectors and traders. The draft Agricultural Marketing Act, which will be sent to Parliament in the 2012 budget cycle, provides an opportunity to re-establish AMIC’s mission and importance.

A value chain is a sequence of steps involved in the process of production to market delivery of a product. It provides a means of understanding relationships between businesses, methods for increasing efficiency, and ways to enable businesses to increase productivity and add value. This paper offers a guide of value-chain approaches in the context of five main issues: trust and cooperation, governance, market power, innovation and knowledge, and focus/intervention points. It offers value chain implementation tools such as designing new strategies and business plans, aligning supply to match market opportunity, improving the business environment, and monitoring results in value-chain development.

Radio Talkshow, Podcast and Weblog Promoting Sustainable Agribusiness Value Chains in the CARICOM/CARIFORUM.