1. 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

2. C:AVA project

3. 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

4. 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)

5. 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!

6. 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

7. Costs and profit margins Nigeria
Improvement flash driers

8. Costs and profit margins Ghana
Competition with kokonte

9. Costs and profit margins Ghana

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

11. Costs and profit margins Malawi

12. Costs and profit margins Tanzania

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

14. 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’)

15. Thank you

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