Partners: Funded by the Bill and Melinda Gates Foundation Country comparison of efficiencies and profitability in the HQCF value chain Helena Posthumus, Kola Adebayo, Francis Alacho, Nanam Dziedzoave, Grace Mahende, Vito Sandifolo, Lateef Sanni, Andrew Sergeant, Andrew Westby Partners: Funded by the Bill and Melinda Gates Foundation

C:AVA project

HQCF value chain Value chain End use Milling & sieving & packing High Quality Cassava Flour Milling & sieving & packing Cassava dried grits Drying Value chain Cassava wet mash / cake Grating & pressing Peeling & washing Cassava fresh roots Cultivating & harvesting Fresh cassava roots

The objectives of the exercise were: to allow comparison of production costs between countries; to identify areas for improvement of efficiency and profitability; to inform price negotiation; to provide information for M&E purposes (e.g. return per beneficiary)

Methodology Based on typical costs of current practices and yields by country Assume use of sun drying or upgraded flash dryers Typical wage for unskilled labour used for labour costs: $1 to $4 per day (opportunity cost of labour) Regular monitoring of prices (incl wheat flour) Disclaimer: these are indicative figures!

HQCF value chain Value chain Value addition: production costs + profit margins HQCF Price of HQCF Profit margin processor (transport costs) End use Fixed costs Milling & sieving & packing Diesel costs for drying Other drying costs Drying Value chain Grating & pressing Processing costs Peeling & washing Price of roots Profit margin farmer Cultivating & harvesting Production costs of roots (FCR) Fresh cassava roots

Costs and profit margins Nigeria Improvement flash driers

Costs and profit margins Ghana Competition with kokonte

Costs and profit margins Ghana

Costs and profit margins Malawi Flash-dried HQCF to substitute corn starch ($1200/t) from South Africa; expected price is $700 - $800 /t

Costs and profit margins Malawi

Costs and profit margins Tanzania

Costs and profit margins Uganda Price of roots have gone down now to less than $200 / t HQCF

Lessons learned Various (market) drivers influence prices offered for HQCF – different in each country Price of alternative raw materials (wheat flour, corn starch, local cassava flour) for targeted end use of HQCF determines HQCF price Policies (import tariffs, tax, subsidies) Foreign Exchange Landlocked country vs sea port Price of alternative cassava products (at local markets) determines price of cassava roots Technology ↔ scale ↔ productivity ↔ efficiency ↔ profitability Importance of profit margins across value chain Need to create consistent and constant supply of raw material (fresh cassava roots): By improving productivity of cassava Through contracts and price agreements By involving large-scale commercial growers, linked with smallholders (‘outgrower scheme’)

Thank you

Costs and profit margins Uganda Price of roots have gone down now to less than $200 / t HQCF