Managing Post-harvest Systems

1. Managing Post-harvest Systems to Enhance Agricultural Productivity Competitiveness and Markets in Western and Central Africa by Dr. Geoffrey C. Mrema Director Rural Infrastructure and Agro-industries Division Food and Agriculture Organization of the United Nations (FAO)

2. Effects rise in food prices and financial crisis • Because of high food prices, the import bill for cereals of African countries rose substantially by 49 percent in 2008 alone. • The financial crisis led to a slow down in economic growth from 6.0% in 2007 to 5.1% percent in 2008.

3. Ratio of Share of Agri-enterprise and Agriculture in GDP

4. Structural Changes and Agro-industries Development Empirical data show that: • In agricultural countries that have not undergone a structural transformation, 63% of the value added in the agri-food system was created on the farm. • In the USA, by contrast, farming accounted for only 7 percent, with the remaining value being created by input producers, agro-industries, transport firms, retailers, restaurants, and others in the agribusiness system.

5. Capital Requirements to Overcome Hunger Cumulative Investments over 44 year period to 2050 in billion US$ Source: Capital Requirements for Agriculture in Developing Countries to 2050, FAO, Rome, 2009 US$ 15 billion/year in additional investment needed

6. Post-harvest Losses (PHL) • Assuming very conservative estimates of quantitative PHL of 10% in cereals, 30 percent in fruits & vegetables and 20% in root & tubers, and using 2007 production data for the 22 CORAF/WECARD countries, quantitative losses in the region are: • 5.37 million tonnes of cereals • 2.43 million tonnes of fruits and vegetables and • 27.59 million tonnes of roots and tubers • This amounts to a total monetary value of US$17.46 billion.

7. Regional and Local Market Opportunities • Demand for agricultural commodities and high-value products across Africa is expected to grow from US$ 50 billion in 2000 to US$150 billion in 2030. • The potential income that farmers could derive at the farm level from increased trade in domestic and cross-border markets is expected to grow to US$30 billion in 2030; • Developing the necessary market links could increase rural incomes by up to another $60 billion.

8. Population Figures for CORAF/WECARD Countries • Population of the 22 countries considered together will increase from current level of 417 million to 527 million in 2020 and over 883 million in 2050. • By 2020, an equal number of the population will live in rural and urban areas. • Beyond 2020, the urban population is projected to rapidly outgrow the population in rural areas. • By 2050, 67% of the region’s population will live in urban areas.

9. Population Centers in West and Central Africa

10. Africa in Global Trade and Value Addition • African countries contribute less than 10% to global value addition. • Africa’s share in world agricultural trade declined from 15% in the 1960s to 5.4% in the 1980s and 3.2% in 2006. • Africa’s international trade is dominated by primary commodity exports - almost 60% of total export value, remaining 40% being fuels/petroleum. • Non-fuel primary commodity exports, agricultural products account for more than 25% of trade revenues • Intra-African trade barely 10% of Africa’s total agricultural trade. • Intra-regional exports averaging US$ 3.8 billion between 2000 and 2005 while imports of agricultural commodities from outside Africa averaged US$ 33 billion.

11. Rice Import Figures RICE IMPORTS IN SSA AND WCA REGIONS 2005 (in 1000 MT) Source: World Grain Statistics (2007), International Grain Council, London (August 2008)

12. Key Intervention Areas Four main areas of support are essential for development of post-production agro-enterprises and agro-industries: • Enabling policies & public goods; • Value chain skills & technologies; • Post-production institutions & services; • Reinforced financing & risk mitigation mechanisms

13. Enabling policies and provision of public goods • Sector Strategies & Plans; • Legal and Regulatory Frameworks; • Grades & Standards; • Agricultural Mechanization; • Markets & Trade Infrastructure; • National & Regional Trade Policies

14. Skills & technologies • Development of skills & technologies needed for post-production segments of agricultural value chains should address: • Producer, Commodity & Industry Associations; • Value Chains Facilitation; • Business Development Services • Producer & SME Skills Building; • Technology Development & Transfer; • Vocational, Business & University Training

15. Innovative Institutions and Public Services • Contract Farming & Out-grower Schemes; • Business Incubators, Hubs & Clusters; • Research, Technology & Agro-Food Parks; • Product Labeling & Certification Schemes; • Commodity Exchanges & Market Information

16. Finance & Risk Mitigation • Public-Private Partnerships • Loan Guarantees • Investment Funds • Value Chain Finance • Risk Mitigation Products

17. HLCD-3A Co-organizers • Government of the Federal Republic of Nigeria (Hosts) • African Union Commission (AUC) • African Development Bank (AfDB) • Food and Agriculture Organization of the United Nations (FAO) • International Fund for Agricultural Development (IFAD) • United Nations Economic Commission for Africa (UNECA) • United Nations Industrial Development Organization (UNIDO) 17

18. To increase private sector investment flows going into the agriculture sector in Africa by mobilizing resources for agribusiness & agro-industrial development from domestic, regional & international financial systems 3ADI Main Objective

19. 3ADI - What the Initiative will do? • Specifically the Initiative will: • Leverage current attention to agriculture in Africa to accelerate the development of agribusiness & agro-industries sectors that ensure value-addition to Africa’s agricultural products; • Support a well coordinated effort to share knowledge & harmonize programmes in ways that capture synergies, avoid fragmented efforts, & enhance developmental impacts; • Support an investment programme that will significantly increase proportion of agricultural produce in Africa that is transformed into differentiated high-value products.