Let’s invest in better agricultural value chains to ensure food security

Friday September 28 2018


Farmers in the eastern region are stuck with tonnes of maize they cannot find market for. PHOTO | CYRIL NDEGEYA 

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Rwanda is faced with oversupply of some food and an acute scarcity of others — a situation industry players have termed a paradox.

This is because for example, while there is plenty of maize in the country some millers are importing the grain and country is on the verge of becoming a net importer of Irish potatoes.
The current circumstances explain why we need better agricultural value chains.

And although there is scientific evidence showing that agricultural value chain resilience is a crucial component to food security in developing countries including Rwanda, it has received little attention.

A value chain is a set of linked activities that work to add value to a product. It consists of actors and actions that improve a product while linking commodity producers to processors and markets.

Value chains work best when their actors co-operate to produce higher-quality products and generate more income for all participants along the chain, as opposed to the simple value chains, in which producers and buyers exchange only price information — often in an adversarial mode.

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.

A value chain approach in agricultural development helps identify weak points in the chain and actions to add more value.

In Rwanda, for example, according to previous research, analysis of the dairy value chain identified critical needs for more local milk cooling points, more collaboration between dairy plants and farmers and greater diversification of final products.

This example illustrates, finding ways to improve value chains can be very important not only for raising small holders’ incomes but also boosting food security.

Without being linked into markets they are condemned to produce only for subsistence — better markets can lift them out of poverty. But making this leap requires more knowledge, and many actors along the value chain can help supply this crucial ingredient.

Therefore, the government needs to do more to support the development and coordination of value chains.

Investments that incentivise greater productivity and the ability to capture a higher value include transport infrastructure; energy for processing, chilling, drying, and packaging commodities.