SOUTH KIVU FOOD SECURITY PROJECT Market Systems Assessment Kabare & Kalehe Territories, South Kivu, DR Congo MAY 2018
Table of Contents LIST OF ACRONYMS 4
EXECUTIVE SUMMARY 6
Background 6
Findings 7
2. METHODOLOGY 9
2.1. Activity Planning and Desk Review 9
2.2. Design of Survey Tools - Interviews guide / Questionnaires 9
2.3. Sampling and Data Collection 10
2.4. Data Analysis and Reporting 10
2.5. Report validation 10
3: AGRICULTURAL VALUE CHAINS ANALYSIS IN KABARE AND KALEHE 11
3.1. Overview of Agricultural Value Chains in South Kivu - Kabare and Kalehe 11
3.2. Findings on Value Chain Analysis in South Kivu - Kabare and Kalehe 12
3.2.1. Access to inputs 13 3.2.2. Agriculture Production Techniques and Access to Agriculture Services 16 3.2.3. Post-harvest and handling techniques 32 3.2.4. Agro-Processing in Kalehe and Kabare 37 3.2.5. Packaging and Storage Systems 42 3.2.6. Marketing of Commodities in South Kivu - Kabare and Kalehe 43 CHAPTER 4: MARKET SYSTEMS IN KABARE AND KALEHE 46
4.1. Overview of Market Systems in South Kivu - Kabare and Kalehe 46
4.1.1. Definition of a Market System 46 4.1.2. Market System Environment 48 4.2 Findings on Market System Selection 56
4.2.1. Market systems for targeted commodities 56 4.2.2. Market Specific Reports of Selected Markets 62 4.2.3 Market Network in South Kivu - Kabare and Kalehe 91
South Kivu Food Security Project Assesment Report on Market Systems 2 CHAPTER 5: KEY INTERVENTIONS 97
5.1 High Priority Interventions 97
CHAPTER 6: CONCLUSION & RECOMMENDATIONS 102
LIST OF KEY INFORMANTS INTERVIEWED 105
REFERENCES 108
South Kivu Food Security Project Assesment Report on Market Systems 3 LIST OF ACRONYMS ACOSYF Association Cooperative en Synergie Feminine ADRA Adventist Development and Relief Agency AGRIFORCE A seed multiplication enterprise AfDB African Development Bank AJP Association des Jeunes pour la Paix ARSO African Regional Organization for Standardization AVA Agent Villageois Agricole BSI British Standards Institute CAADP Comprehensive African Agricultural Development Program CARG Conseil Agricole Rural de Gestion CDF Congolese Franc CEDIN Centre de Documentation et d’Information sur Normes CFSVA Comprehensive Food Security and Vulnerability Analysis COMESA Common Market for Eastern and Southern Africa COODAK Cooperative pour le Dévelopement Agricole de Kalambo COOPADI Cooperative Agricole pour le Developpement Integré CSPRO Census and Survey Processing System DAP Diammonium Phosphate DGDA Direction Générale des Douanes et Accises DGM Directorate General of Migration DHS Demographic and Health Survey DRC Democratic Republic of Congo ETS Etablissements FAO Food and Agriculture Organization FEC Fédération des Entreprises du Congo FEWSNET Famine Early Warning System Network FINCA Fighting Poverty with Microfinance and Social Enterprises FOPAC Féderations des Organisations des Producteurs Agricoles du Congo FSP Food Security Project HACCP Hazard Analysis Critical Control Point system HIV Human Immunodeficiency Virus IAT Inspection Agricole Territoriale ICT Information and Communication Technology IITA International Institute of Tropical Agriculture IKYA IITA Kalambo Youth entrepreneurs in Agribusiness INERA Institut National pour l’Etude et la Recherche Agronomiques IPAPEL Inspection Provinciale de l’Agriculture, Pêche et Elevage ISO International Organization for Standardization MASOSO Maize, Soya and Sorghum mixed flour MT Metric Tonnes NAIP National Agricultural Investment Plan NGO Non- Government Organization NPK Nitrogen, Phosphorus and Potassium OCC Office Congolais de Contrôle OGFREM Office of Management of Multi-modal freight
South Kivu Food Security Project Assesment Report on Market Systems 4 PADEBU Programme d’Action pour le Développement des Bases Unies, a local NGO PAIDEC Programme d'Appui aux Initiatives de Developpement du Sud Kivu, an agricultural cooperative R&D Research and Development REGIDESO Régie de Distribution d’Eau, The Congolese water authority SADC South African Development Community SENADEV Service National de Defence et Protection des Vegetaux SENAMA Service National pour la Mécanisation Agricole SENAQUA Service National d’Aquaculture SENASEM Service National des Semences SNEL Service National d’Electricité SNSA Service National des Statistiques Agricole SNV Service National de Vulgarisation SPSS Statistical Package for the Social Sciences SQAV Animal and Vegetable Quarantine Service SWOT Strengths, Weaknesses, Opportunities and Threats Assessment UCOAKA Union des Cooperatives Agricoles de Kalehe USAID United State Agency for International Development VSLA Village Savings and Lending Associations
South Kivu Food Security Project Assesment Report on Market Systems 5 EXECUTIVE SUMMARY
Background
The South Kivu Food Security Project (FSP) is a 5-year USAID/Food for Peace program implemented by Mercy Corps, in consortium with World Vision, APC, Harvest Plus and Université Evangelique en Afrique (UEA). The overall program goal is for vulnerable populations (approximately 35,000 households/210,000 people) from three health zones in Kalehe and Kabare Territories, South Kivu to improve their food and nutrition security and economic well-being. During the program’s first year focused on refinement, FSP conducted a strategic resilience assessment (STRESS) to analyze the social, ecological, and economic systems within which communities are embedded and how these conditions determine vulnerability to shocks and stresses and food security outcomes. The STRESS process has enabled the FSP consortium to identify the main risks potentially preventing communities from protecting their expected food security outcomes. The results of this assessment process show that communities can improve resilience to stresses and shocks if alternate revenue options are available. Also, it was observed that on average, South Kivu households purchase 68% of their food from markets instead of relying on their own production. Alternate revenue options are limited due to a multitude of causes, such as the lack of processing capacities in small commercial centers; limited investments from the government and private sector; nearly inexistent business services; an under-developed market for non-agricultural products; and lack of access to financial services. Improved market systems that enable the most vulnerable to meaningfully participate should focus on the development of appropriate business services for farmers and other actors in the value chain. This development will reinforce market organization for increased efficiency and investments in key parts of value chains such as transport, storage and post-harvest handling and processing. It is anticipated that sustainable development of market systems in South Kivu will ensure that investment from private sector partners contributes to smallholder farmers’ resilience to market shocks. The purpose of this assessment was to understand the market systems related to agricultural livelihoods for FSP target populations and develop a mapping of these systems with key actors, capacities, incentives, and constraints; and to identify market opportunities, gaps and leverage points in each target market to ensure that both producers and consumers can benefit from opportunities. An analysis of key value chains was included with a special attention to beans, cassava, maize, and onion. The study was conducted in Kabare and Kalehe territories in South Kivu Province of DRC.
South Kivu Food Security Project Assesment Report on Market Systems 6 Findings
The South Kivu Market Assessment for FSP resulted in many key findings that are presented in this report. Notably: While there is some activity in improved seed production in South Kivu, access to improved seed is still limited in Kabare and Kalehe and only 25% of farmers in the FSP target population use improved seed because of weak organization of the seed market, limited number of seed multipliers, limited government support in this sector, high cost of seed and low purchasing power of farmers. The use of inorganic fertilizers (DAP, NPK, Urea, and Lime) in Kabare and Kalehe territories is still also limited, and most respondents indicated that they don't use them, though a majority of farmers use compost and manure to improve the fertility of their soils. This limited use of inorganic fertilizers is due to different factors including limited availability, lack of farmer knowledge, limited purchasing power, high cost, and weak linkages between farmers and inputs traders. In addition, fertilizer imports are subject to heavy taxes and fees (importation license, custom fees, OGFREM, OCC, Revenues Authority, External Trade Division, Sanitation Fees). Moreover, fertilizer supply is still low and there is no local production of fertilizer in South Kivu. Effective agriculture extension services are insufficient to meet farmers’ needs. Although many agencies exist - SENASEM (Service National des Semences), SENAQUA (Service National d’Aquaculture), SNV (Service National de Vulgarisation), SENAMA (Service National pour la Mécanisation Agricole), SNSA (Service National des Statistiques Agricoles), SENADEV (Service National de Défense et Protection des Végétaux) – these agencies have limited resources and capacity, contributing to below-average yields for beans, maize, cassava and other crops. Limited access to finance has an impact on crop production, as scaricity of agricultural financing limits farmers’ ability to invest in inputs or modernization. Financial institutions consider agriculture a high-risk sector and offer only high-interest loans. Post-harvest and handling losses are high - estimated to be 15% to 45% depending on the type of product, and horticulture products are the most vulnerable due to their perishability. In Kabare and Kalehe territories, a majority of farmers faces the problem of lack of storage facilities and thus sell off their produce at lower prices soon after harvesting due to anticipated post-harvest losses, and later on, these same farmers buy these needed commodities at higher prices. Agro-processers exist - primarily concentrated in Bukavu City and around shopping centers and markets – and most of these are small milling machines processing cassava, sorghum, maize and soy beans. Processers have limited capital and face challenges with frequent power outages. While farmer’s associations and cooperatives do exist, in most cases, farmers sell their produce individually at the farm or household level to collectors or on the local market to
South Kivu Food Security Project Assesment Report on Market Systems 7 buyers. Farmers don’t know how to calculate their cost of production, they don’t know how prices are determined, they lack units of measurement, basic storage facilities, and knowledge of the required quantities and quality needed by the markets, and they may not know the final destination of their products. Given these contextual challenges and the existing market dynamics in the two territories, this study selected the following crops for market development based on a set of criteria including potential for growth and income creation. Cassava is a crop that is cultivated by many households in Kabare and Kalehe, more resilient to different factors as highlighted above and has a higher output that may be improved. This value chain involves many actors including women in its marketing. This crop is the most processed among all targeted FSP crops, has a high demand and can generate incomes and improve household livelihoods. Beans are also widely cultivated by many households and contribute towards soil fertility with intercropping potentiality. They are an important food staple consuming by almost every household in South Kivu, though beans are not yet processed in South Kivu. Maize is also a food staple in South Kivu, cultivated by the majority of households but in mixed crop pattern with low yields. In the FSP targeted areas, maize is mostly consumed fresh (roasted or cooked) with limited processing and value addition, and local production competes poorly with maize products (such as flour) from other regions and neighboring countries. Onions are not grown everywhere in Kabare and Kalehe, but when grown yields are high, and since the crop is widely consumed, demand is also consistently high. Onion production is typically very profitable, notably for female farmers. This report identifies priority interventions to develop these four high-potential value chains to benefit vulnerable smallholder farmers. Specific interventions are proposed to address challenges related to production, post-harvest and handling, processing and marketing. These interventions aim to increase productivity of target crops, decrease post-harvest losses, add value with agro-processing, and increase access to markets and linkages between smallholder farmers and other market actors.
South Kivu Food Security Project Assesment Report on Market Systems 8 2. METHODOLOGY In line with the objectives of this assessment, the starting point for assessment activities was a consultative meeting between consultant and the FSP leadership team to discuss and agree on a workplan and methodology. The key activities involved in this assessment were activity planning and desk review, design of interviews guide and survey tools, identification of key informants and markets to be surveyed, data collection, data analysis and interpretation and elaboration of this final report. The identified key informants included representatives of INERA, SENASEM, Territorial Economic Services in Kabare and Kalehe, Centre OLAME, Representative of Agriculture Products Collect Centers, Market Committees, Minoterie IKYA, CARGs, FEC, AIDEBU, COOPTRAF, IITA, ACOSYF, MAJIRANO Cooperative, COOPAKAB, Ets BAKULIKIRE, FOPAC, AGROPROFOCUS, PROCREDIT Bank, FINCA, FAO, South Kivu Value Chain Project, Harvest Plus, Société Olive, and IPAPEL. The FSP target area has about 19 markets and eight markets were selected to be surveyed based on their location and their importance in term of commodity transactions. Those markets comprised Mudaka, Kavumu in Miti Murhesa health zone, Katana, Birava, Chabwenemwami in Katana health zone and Ihusi, Nyamukubi and Nyabibwe in Kalehe health zone. Muhanzi and Kadutu markets in Bukavu city were also visited. 2.1. Activity Planning and Desk Review
Before commencing fieldwork to conduct the market systems assessment, the consultant developed a road map showing the timeline of activities. Relevant documents within the context of market systems assessment and value chain development were reviewed as secondary data sources, including the FSP proposal, market assessment documents (South Kivu Market Assessment, Mercy Corps - 2016), policies (on agriculture, trade), assessments and analyses from USAID in South Kivu, Assessments and analyses conducted by Feed the Future partners, value chains assessments and analyses documents (for cassava, beans, maize and onions), projects reports, documents on sustainability, resilience, gender and youth, among others. A complete list of secondary data sources can be found in the references section of this report. 2.2. Design of Survey Tools - Interviews guide / Questionnaires
Based on the desk review and consultative meetings, survey guide and questionnaires suitable to the different categories of key informants to be interviewed were developed. In addition to the actors mentioned above, key informants included farmers’ groups, women groups, youth groups, commodities traders, commodities processors and inputs traders. The questionnaire for farmers groups focused on the access to inputs, access to agriculture production techniques, access to post harvest and handling techniques, access to storages facilities, access to transport, information on markets prices, fees and taxes, opportunities and challenges; while the questionnaires for commodities and inputs traders focused mainly on the
South Kivu Food Security Project Assesment Report on Market Systems 9 source of their products, volume traded, access to storage facilities and storage techniques, information on markets prices, price fluctuation, access to transport, access to finance, clients, fees and taxes, opportunities and challenges. The questionnaires for commodities processors were centered on their processing capacity, source of row materials, energy, packaging, market, production techniques, quality and standards, fees and taxes, opportunities and challenges. Questionnaires for women and youth were based on their domain of activities. 2.3. Sampling and Data Collection
The sampling procedure was based on each level according to different roles played by the actors. Two farmers’ groups (with at least 10 members each) in each territory were identified, including women and youth farmer’s groups. Focus group discussions were conducted with these groups. In the eight markets targeted, market actors including markets committees, traders, processors, transporters and financial institutions were interviewed using semi- structured questionnaires. A particular attention was given to traders, processors and input traders: 20, 15 and 4 were interviewed respectively. In addition, 54 key informants were interviewed, as mentioned above. 2.4. Data Analysis and Reporting
Quantitative and qualitative data were analyzed and presented quantitatively and qualitatively in a complementary way. Quantitative analysis was electronically designed using CSpro and the findings were produced using SPSS and STATA statistical software. The qualitative data was collected through notes from focus groups and interviews, coded and analyzed to indentify recurring themese and trends.
2.5. Report validation
Following the drafting of the report, a limited dissemination was organised among the main stakeholders and a restitution workshop was organised in January 2019, under the high patronage of the Acting Minister of Agriculture, in order to enrich the document and validate the various elements of it. The workshop was an opportunity to bring together the main actors in the value chains concerned: the Ministry of Agriculture, FAO, private sector and voluntary sector actors, the Feed the Future project funded by USAID. The report was thus validated.
South Kivu Food Security Project Assesment Report on Market Systems 10 3: AGRICULTURAL VALUE CHAINS ANALYSIS IN KABARE AND KALEHE 3.1. Overview of Agricultural Value Chains in South Kivu - Kabare and Kalehe
Kabare and Kalehe territories targeted by FSP are two of eight territories that constitute the South Kivu Province. The province is characterized mostly by equatorial vegetation and land extending from high altitudes and plateau areas reaching closely 3,500m alongside the western coast of Lake Kivu and descending westward down to a less densely populated area at approximately 500m and equatorial forest area. In this region, soils are mainly volcanic with abundant rainfall, allowing for two extended growing seasons, primarily from September to December, and March through May. South Kivu has a tropical savanna and warm summer climate, with an average monthly temperature of 21oC. The average annual rainfall is over 1,600mm and the minimum average is 1,000mm. In South Kivu Province, agriculture is an important livelihood for most households and about 73% of the population relies on agriculture as their main source of income while 11% of population lives on trade activities. According to IPAPEL South Kivu, farmers in Kabare and Kalehe territories produce mainly cassava, beans, maize, soybeans, groundnuts, banana, sorghum, Irish potato, taro, sweet potatoes, onions, tomatoes and other horticulture products as food crops, and coffee, tea, cinchona and palm oil as cash crops depending on their agro ecological zone. The “Assessment of the DRC’s Agricultural Market Systems : Value Chains in the North & south Kivu and Katanga provinces” (April 2015) conducted by ACDI-VOCA indicates that 91% of south Kivu farming households produce cassava while 52% produce maize, 32% produce beans and 25% produce groundnuts. The figure 1 below illustrates more details on agricultural production in South Kivu Province.
Crop production in South Kivu 100% 90%
80% 70% 60% 50% 40% 30% Crop prevalence 20% 10% 0% Groundn Sweet Vegetabl Corn Beans Cassava Bananas Rice Potatoes Sorghum uts Potatoes es South Kivu 52% 32% 25% 91% 5% 5%
Figure 1: Major crops produced in South Kivu
South Kivu Food Security Project Assesment Report on Market Systems 11
To produce staple crops, the majority of farmers in South Kivu still use traditional methods and access to agriculture services is limited. A study conducted by ADRA in 20121 indicated that only 7.4% of farmers in South Kivu received agriculture services and mostly from NGOs. In a 2012 study2, Food for the Hungry showed that the use of inputs is limited and less than 10% of farmers in South Kivu use improved seeds. South Kivu Province faces crop diseases such as cassava mosaic virus and banana xantomonas wilt, which affect crops yields and households incomes.
For smallholder farmers, access to land is limited due to high population density and to the fact that most fertile land is owned by a few wealthy individuals. IPAPEL's statistics show that more than 86% of farmers in South Kivu cultivate less than 0.45 hectares with the average size of a domestic farm between 0.3 and 0.4 Ha. Knowledge of post-harvest and handling techniques is limited while storage facilities and post-harvest and handling equipment are insufficient leading to increased post-harvest losses. Agricultural value chain stakeholders include farmers, farmers’ cooperatives and associations, small traders (collectors and retailers), brokers, big traders (wholesalers, importers and exporters), processors, transporters, financial services, advisory services, communication services, government, nongovernment organizations, donors and end consumers. Although the South Kivu Province possesses high potential for food production, the large part of food supply is imported and the majority of the population is poor and suffers from malnutrition. As per the national comprehensive food security and vulnerability analysis conducted in 2014 by the World Food Program,3 it was found that South Kivu has the highest percentage (64%) of food insecure households in DRC. Moreover, the DRC Demographic and Health Survey (DHS)4 done in 2013-2014 indicates that the prevalence of stunting in South Kivu is 53%, higher than the national average (43%).
3.2. Findings on Value Chain Analysis in South Kivu - Kabare and Kalehe
The value chain analysis was done for FSP targeted commodities (beans, cassava, maize, onions and other crops with high potential). This analysis focused on access to inputs, production techniques, post-harvest and handling techniques, processing and marketing.
1 USAID/FFP Food Security Desk Review for Katanga, North Kivu and South Kivu, December 2015 2 Food for Hungry – IITA, 2013, Value Chain Analysis of Roots and Tubers, Bananas, Grains, Legumes and Cereals in North Katanga and South Kivu DRC 3 Comprehensive Food Security Vulnerability Analysis (CFSVA), DRC, World Food Program, 2014 4 Demographic Health Survey, DRC, 2013-2014
South Kivu Food Security Project Assesment Report on Market Systems 12 3.2.1. Access to inputs Inputs used in commodity production in South Kivu are seed, fertilizer (organic and inorganic), production tools like hoe and machete and pesticides. The development of improved seed in South Kivu is mainly done by INERA, which is in charge of the development of pre-basic (first generation) and basic (second generation) seed. This institute collaborates with seed multipliers including AGRIFORCE, PADEBU, and Rhugwasanye Association to produce commercial seed. The developed and multiplied seed is certified by SENASEM after inspection of seed plantation and various seed tests. Certified seed is then sold to farmers. According to SENASEM, there are about 300 seed multipliers in South Kivu from which 111 are more dynamic in the sector. The development of bio-fortified seed is done by INERA in collaboration with Harvest Plus. Bio-fortified crops are required to improve nutritional status of vulnerable households in Kabare and Kalehe FSP areas. Harvest Plus has about 17 bio-fortified varieties of beans, maize and cassava. To multiply and disseminate seed, Harvest Plus collaborates with seed multipliers through contracts (production, dissemination and purchasing contracts). As of today, INERA and Harvest Plus do not have onion seed and they recommend farmers to buy them from private local importers like AGRIFORCE. This study established that access to improved seed is limited as indicated by the majority of respondents (farmers and farmer’s organizations), whereby 75% of them confirmed that they do not have access to improved seed as shown by the figure 2 below.
Figure 2: Use of improved seeds in Kalehe & Kabare
The reasons for this situation are the weak organization of the seed market (poor planning of demand and supply and lack of linkages between seed multipliers and farmers), limited number of seed multipliers, limited government support in this sector, limited availability of improved seed, high cost of seed and low purchasing power of farmers. During this study, most of interviewed farmers expressed their interest in using improved seed, as traditional seed has degenerated which affects the crop yield and income generation. To illustrate the lack of linkages between seed multipliers and farmers in Kalehe territory, the case of ADAC Tuwonembere Association located in Munanira locality is a good example. In the interview, they reported that they produced quality seed for beans and soybeans without a clear customer base and consequently they were constrained to sell the multiplied seed at a
South Kivu Food Security Project Assesment Report on Market Systems 13 cheaper price (similar to prices for traditional seed). They added that they considered this a loss, considering the skills and efforts required producing such quality seed, and they became discouraged. The majority of farmers still use seed bought from usual commodity markets. In the context of seed availability, farmers in Kabare and Kalehe where cassava is one of the principal food staples, are now facing a big challenge of obtaining cuttings due to the heavy frost that destroyed cassava plantations in last few seasons (Season 2016 A & B, 2017 A). In collaboration with One Acre Fund, AGRIFORCE is initiating a project to develop onion production in Miti-Murhesa area whereby they shall provide credit to farmers in form of needed inputs for onion production (seed, mineral fertilizers, pesticides) equivalent to USD 80 and payable in 3 installments: 40% after one month, 20% during the harvest and 40% after 6 months. At the time of initiating this project, 116 farmers demonstrated interest in the initiative, though only 46 ended up following through with the program. However, AGRIFORCE confirmed that 87% of these farmers reimbursed in full their loans. Such an initiative is worth exploring for FSP, which could provide gradually decreasing support to farmers for the purchase of seeds (for example, cover 50% of the cost in the first year, 30% in year 2, and so forth, with the aim of creating demand for improved seed among small-holder farmers and linkages with suppliers. In Kalehe territory, we observed that farmers are organized in cooperatives and some are involved in seed multiplication, including Rhugwasanye Association in Muleba, GEV in Muhongoza, and COODAK in Bujuki, which collaborate with INERA and are certified by SENASEM. The four cooperatives are members of UCOAKA (Union des Cooperatives Agricoles de Kalehe), a cooperative union of 12-member cooperatives, which has benefited from World Vision support under the JENGA Project whereby a storage facility for seed and commodities was constructed. This union can be a good channel of quality seed distribution. This study observed that no large seed companies (such as SeedCo, Kenya Seed, Pannar) had presence in South Kivu. This may be due to low purchasing power and weak demand for improved seed.
Brief description of seed production
Beans Improved bean seeds used are mostly developed by INERA, disseminated by seed multipliers and are certified by SENASEM. Climbing and bush bean varieties are available depending on the agro-climatic zones. As highlighted above, there are also bio-fortified bean varieties developed by INERA and Harvest Plus. This study observed that the majority of farmers don’t use improved varieties but rather their own seed or seed purchased from local markets. Though farmers recognize that climbing beans have better yield potential, the stakes needed for these varieties can be a serious challenge to most farmers. They are more adaptable in North Kivu and are highly competitive on the South Kivu markets. According to INERA, one kilogram of improved seed cost $2, which may be out of reach for many farmers. Bean seed multipliers such as AGRIFORCE sell a kilogram at $1.50 to farmers. The bean seed market is
South Kivu Food Security Project Assesment Report on Market Systems 14 not well organized and seed multipliers are limited in number and capacity. The bean varieties that have been disseminated in South Kivu are HM 21 and NAB4 (bush beans), MAC44 and RWV1129 (climbing beans). Yield for bush beans are between 800 kg – 1,200 kg/Ha while climbing beans yield between 1,500 and 3,000kg per hectare. Cassava Cassava is one of the most consumed commodities in South Kivu Province and DRC in general. Like other commodities, cassava seed (cuttings) are developed by INERA who collaborate with multipliers to disseminate improved cassava cuttings. HarvestPlus in collaboration with INERA has developed bio-fortified cassava varieties. In South Kivu, cassava varieties have been affected by the mosaic virus and the cassava brown streak disease. This has had a negative impact on the productivity of cassava. Cassava brown streak disease is mostly present in the lower altitude area towards the Ruzizi plain. INERA has developed and disseminated the SAWASAWA and MAYOMBE varieties, which are more resistant to the cassava mosaic virus in Kabare and Kalehe territories. The cost of improved cassava cuttings is $0.30 per linear meter sold to multipliers. Multipliers such as AGRIFORCE sell it at $0.20 to farmers. Average yields for these varieties is 20T/ha. Farmers in Katana, which is an area producing a lot of cassava, confirmed that they don’t use improved cassava cuttings because of cost and availability. Maize To produce maize, the majority of farmers in Kabare and Kalehe use their own seed bought from the local market or saved from their previous harvest. Often, the yields are lower due to degeneration. However, according to INERA, a few improved varieties have been developed and disseminated. HarvestPlus in collaboration with INERA have also developed and disseminated bio-fortified maize seed. The improved seed available on the market are ZDM 627 and UH 5053. The average yield is estimated to be respectively 4T/ha and 7T/ha. The cost per kilogram is $2 at INERA and $1 at the multiplier level. Onions According to INERA, there are no onion varieties that were developed locally. Farmers acquire seed through different channels including local seed traders and importation from neighboring countries. INERA recommended farmers to acquire seed from AGRIFORCE. As mentioned above, AGRIFORCE has developed a joint program with One Acre Fund to develop and disseminate improved onion seed to farmers. They sell two red varieties from SeedCo and Kenya Seed, two seed companies present in East and Southern Africa. Price for SeedCo is $60/kg while Kenya Seed is $44/kg due to their yield output.
Fertilizers and other inputs The use of inorganic fertilizers (DAP, NPK, Urea, and Lime) in Kabare and Kalehe territories is still limited. All farmers' organizations visited indicated that they don't use them. However, all of them declared that they use compost and manure to improve the fertility of their soils. This limited use of inorganic fertilizers is due to different factors including limited availability of
South Kivu Food Security Project Assesment Report on Market Systems 15 inorganic fertilizers, lack of awareness at farmers' level, limited purchasing power of farmers, high cost of inorganic fertilizers and weak linkages between farmers and inputs traders. In addition, fertilizers imports are object to a lot of taxes and fees (importation license, custom fees, OGFREM, OCC, Revenues Authority, External Trade Division, Sanitation Fees) as mentioned by some importers. Moreover, the quantity of imported fertilizers is still low compared to the needs and there is no fertilizer processing or blending unit in South Kivu. For example AGRIFORCE, one of the biggest South Kivu fertilizer importers indicated that they imported about 40MT of NPK, 120MT of DAP and 60 MT of Urea in 2016. This study established that the compost produced by farmers is not enough and many farmers expressed a need of increasing household small livestock like rabbit, goat, pig, chicken, and guinea pig in order to produce more manure required for agriculture. Based on these findings regarding the access to inputs, a number of interventions are proposed and captured in the box 1 below.
Key Interventions on Access to Inputs 1. Comprehensive identification of farmers' needs for agriculture inputs 2. Proper planning for inputs distribution 3. Establish seeds multipliers network and facilitate market linkages 4. Promotion of Farmers organization and empowering them in inputs distribution 5. Advocacy to the Government for the exemption of agriculture inputs levies and fees 6. Creation of public awareness for the importance of quality inputs use 7. Encourage private sector to invest in agriculture inputs sector (processing, blending, etc)
3.2.2. Agriculture Production Techniques and Access to Agriculture Services To produce staple crops, the majority of farmers in these territories still rely on traditional methods, as reported by the Inspector of Agriculture, Fishing and Livestock in Kalehe territory during our field visit. Farmers lack access to extension services, modern tools and equipment, limited access to finance and weak market organization. With farming done at a very small- scale level and low purchasing power, buying costly tools or machines such as tractors is often perceived by most farmers as unaffordable. This is one of the reasons farmers revert to using traditional tools and technologies generally limited to hoe, machete and spade. Agriculture mechanization (use of tractors and irrigation systems), use of quality seeds and quality fertilizers are almost inexistent, especially for smallholder farmers who mainly use family members as manpower. Therefore, crop production and productivity is constrained by the above challenges. At a provincial level, the coordination of agriculture activities is done by the Ministry of Agriculture, Land and Rural Development and the Provincial Inspectorate for Agriculture, Fishing and Livestock (IPAPEL), which has specialized services such as SENASEM (Service National des Semences), SENAQUA (Service National d’Aquaculture), SNV (Service National
South Kivu Food Security Project Assesment Report on Market Systems 16 de Vulgarisation), SENAMA (Service National pour la Mécanisation Agricole), SNSA (Service National des Statistiques Agricole), SENADEV (Service National de Defense et Protection des Végétaux). At territorial level, the Territory Agriculture Inspectorate (IAT) is responsible of agriculture services coordination. At administrative chiefdom level, agriculture activities are coordinated by an agronomist while at the sector and locality levels the coordination is done by sector agronomists and agriculture extension agents respectively. This study established that government services are not properly delivered to farmers due to lack of financial and material resources. During the study, territories agriculture staff testified that they were not paid their salary for 3 to 6 months. The scarcity of agriculture services to farmers was also observed by ADRA during the study conducted in 2012. In this study, ADRA indicated that only 7.4% of farmers in South Kivu received agriculture services and mostly from NGOs. This limited access to agriculture services affects the yield of main crops and household incomes. For instance, this assessment found that the average yields for beans, maize, cassava and Irish potato was below the expected optimum yield in 2016 as indicated in the table below.
Table 1: Average yield per hectare for some crops in South Kivu
Commodities Beans Maize Cassava Irish potato Average yield (MT) 0.988 1.06 15 2.5 Optimum yield (MT) 1.5 - 3 4-7 20-30 20-40
This assessment observed that farmers' organizations interviewed in Kabare and Kalehe classified beans as the main staple crop as it is produced by 100% of farming households, followed by cassava and maize produced by 75% of farming households as indicated by the figure 3 below.
Staple Crops, proportion farmed
100 75 75 75 50 50
Beans Maize Cassava Onion Irish Others potatoes
Figure 3: Main staple crops produced in Kabare and Kalehe
South Kivu Food Security Project Assesment Report on Market Systems 17 Interviewed farmers expressed a number of constraints impeding the optimization of crop productivity. Access to land, access to improved seeds, access to good agriculture practices, access to agriculture equipment and climate change are considered by 75% of respondents as main constraints followed by access to quality inputs as indicated by the figure below.
Constraints to Crop Production 80 70 60 50 40 30 20 10 0 Access to Access to Access to Access to Access to production Access to Access to phytosanit post- Climate improved production tools & land fertilizers ary harvest change seeds techniques equipment products techniques s Series1 75 50 75 75 50 75 75 75
Figure 4: Key constraints impeding the optimization of crops production in Kabare and Kalehe
As indicated in the chart above, climate change is also one of the major challenges to crop productivity. For example, farmers reported that their crops were destroyed by heavy frost in the past seasons and in some cases this frost was followed by drought that seriously affected crops productivity and increased household vulnerability. In Kabare and Kalehe, agriculture is largely rain-fed, and studies have revealed that the duration of rainfall has been reduced from 9 to 7 months per year and this affects crop productivity. One of the solutions to this issue of climate change is to apply smart agriculture techniques such as irrigation at large scale and small scheme irrigation for smallholder farmers. The graph above shows that access to land is also one of the main constraints to crop production in Kalehe and Kabare. This limited access to land is due to the fact that most of fertile lands are owned by wealthy individuals, whereby more than 86% of South Kivu farmers cultivate less than 0.45ha as indicated in section 3.1 of this report. In addition, farmers are challenged by land renting which is considered by most of them as expensive. For instance, the average cost of renting land per hectare is around $400 according to the president of UCOAKA (Union des Cooperatives Agricoles de Kalehe) cooperative union. During the field visit, it was found out that the Société Olive SARL and ETS Ihusi/Vany own big land concessions in Kabare and Kalehe territories. According to representatives of these companies, farmers around their land can cultivate them under some established agreements. This kind of agreement, if fair, could enable farmers to have access to land and therefore increase agriculture production. This is in line with Congolese Entrepreneurs’ Union (FEC)’s
South Kivu Food Security Project Assesment Report on Market Systems 18 logic of encouraging agriculture investment to sustainably exploit South Kivu’s rich soils. FEC has an approach called AGRIPAD (Agriculture for Peace and Development) which sensitizes large land owners to work with smallholder farmers in a win-win situation whereby unexploited land is rented to farmers and they pay 10% of produce to the owner via a contract facilitated by FEC. In Kabare and Kalehe, access to financial services was identified among major challenges to farmers because financial institutions are limited in number and consider agriculture as a risky business, and as mentioned in section 3.1, access to extension services in South Kivu province is limited. Finally, farmers in Kabare and Kalehe have concerns about low prices of their produce during the harvest period. As the price depends on the principle of supply and demand, and due to the fact that crop production has a seasonal pattern, farmers sell when prices are low because supply exceeds demand during the harvest period, meaning revenues from the sale of agricultural products are typically sub-optimal.
Brief description of production techniques
Beans To produce beans, most farmers still use traditional production techniques, including mixed cropping with beans, maize, banana, taro, cassava. This affects crop productivity and yields that may make it difficult to estimate production costs. As mentioned above, most farmers use their own saved seed or seed bought from local markets with low performance. Use of fertilizers (organic and inorganic) is very limited, and in some cases non-existent. Farmers also have limited knowledge of improved bean production techniques; for example, during planting, farmers don’t follow proper spacing recommendations and weeding is not done on time. Where climbing beans varieties could thrive, farmers are still using bush beans that have lower yields, since farmers lack the stakes needed to plant climbing beans. There is an opportunity for farmers to plant and use elephant grass and other agro-forestry species like Calliandra and Leucena that could act as stakes for climbing beans. The pictures below illustrate the use of elephant grass as stakes.
Figure 5: Beans staking using agro-forestry species in North - West of Rwanda
South Kivu Food Security Project Assesment Report on Market Systems 19 Finally, farmers are not market-oriented and don’t know how to estimate their production costs. This study has attempted to estimate cost of production and selling price of beans in Kabare and Kalehe as highlighted in the table below.
South Kivu Food Security Project Assesment Report on Market Systems 20 Table 2: Estimated Cost of Production for Beans Current Scenario Ideal Scenario No Item Unit Quantity Unit Total % of Unit Quantity Unit Total % of Price ($) Price ($) expenses Price ($) Price ($) Expenses 1 Field rent (1 season) Ha 1 200 200 39% Ha 1 250.00 250 11% 2 Seed Kg 80 1.50 120 23% Kg 80 1.50 120 5% 3 Organic manure Kg 2,500 0.03 78 15% Kg 10,000 0.03 300 13% 4 DAP/ NPK Kg 100 0% Kg 100 1.40 140 6% 5 Urea Kg 50 0% Kg 50 0.00 - 0% 6 1st Ploughing Man day 100 1.25 125 24% Man day 100 1.25 125 5% 7 Transport of manure Man day 20 1.25 25 5% Truck 2 50.00 100 4% 2nd Ploughing, digging Man day 25 1.25 31 6% Man day 50 1.25 63 3% 8 holes 9 NPK/DAP fertilizer Man day 15 - 0% Man day 20 1.25 25 1% 10 Plant seed Man day 15 1.25 19 4% Man day 50 1.25 63 3% 11 Weeding, harrowing 1 Man day 30 1.25 38 7% Man day 50 1.25 63 3% 12 Weeding, harrowing 2 Man day 25 0.00 - 0% Man day 50 1.25 63 3%
13 Urea fertilizer Man day 20 0.00 - 0% Man day 20 0.00 - 0% 14 Stacks Number 1 0.00 - 0% Number 1 300.00 300 13% 15 Staking Man day 30 0.00 - 0% Man day 40 1.25 50 2% 16 Earthing Man day 20 0.00 - 0% Man day 20 0.00 - 0% 17 Harvesting Man day 30 1.25 38 7% Man day 50 1.25 63 3% 18 Hulling and drying Man day 15 1.25 19 4% Man day 25 1.25 31 1% 19 Plastic sheeting Number 6 0.00 - 0% Number 6 5.00 30 1% 20 Winnowing and sorting Man day 10 1.25 13 2% Man day 20 1.25 25 1% 21 Drying of beans Man day 10 1.25 13 2% Man day 30 1.25 38 2% 22 Bagging Number 4 1.25 5 1% Number 10 1.25 13 1% 23 Bags /basket Number 14 0.50 7 1% Number 60 0.50 30 1% 24 Storage (2 months) Storage 1 20.00 20 4% Storage 1 40.00 40 2% Total expense (USD) 524 1,929 Productivity (tons per ha) 0.7 3
Production cost (per ton ) 749 643 Production cost (per kg in USD) 0.75 0.64 Profit margin in USD (20%) 0.15 0.13
Selling Price (per kg in USD) 0.90 0.77
South Kivu Food Security Project Assesment Report on Market Systems 21 As it is indicated in the table above, bean production cost is estimated at $0.75/kg in current production situation. With a profit margin of 20% equivalent to $0.15, the average selling price is therefore $0.90/kg. In contrast, the ideal production cost of beans comes down to $0.64/kg with a profit margin of $0.13 and leading to a selling price of $0.77/kg. The ideal production scenario takes into account an increase of yield and output and thus justifying decreased production cost. With this ideal production scenario, beans become more competitive on the market. During our field visit we noted that the average selling price in most markets was $0.54/kg around harvest time and $0.98 /kg during the lean season, sometimes increasing up to $1.54/kg as such, it is recommended to store beans after harvest to sell when prices are higher A return on labor and land has been calculated and put into consideration due to large uncertaintaities around estimation and value on labor and wages and land value. On labor the following formula was used: (yield in kg x price per kg) - (other expenses) / (person days). The gross value obtained is the revenue that a farmet gets from the level of effort on production. On land, the following fomular was used: (yield in kg x price per kg) - (other expenses) / (1 ha). The gross value obtained depicts the revenue that a farmer derives from utilizing his land towards production. The return on labor and land in current production scenario for beans was respectively $ 677 and $ 80 wihle in ideal production scenario was respectively $ 2,312 and $ 636. Beans supply in Kabare and Kalehe is made by local production and imports. Statistics available show that, in 2014, bean production in DRC was 248,957MT at the national level and was 55,199 MT in South Kivu Province, and 19,470MT in Kalehe Territory. Data for bean production in Kabare Territory are not available. As data for bean production in Kabare territory are not available we can roughly estimate 7,000 MT per year (based on the overall production for the region). Based on the above figures, we estimate that local supply of beans in Kabare and Kalehe to be around 27,000 MT. This figure does not account for imports from North Kivu and neighboring countries.
The demand for beans in Kabare and Kalehe is due to the consumption of beans in these two territories with a total population of 1,595,942 inhabitants (780,616 in Kabare and 815,326 in Kalehe), where consumption averages 180 grams per person per day. Rwanda and Eastern DRC including South Kivu have the highest per capita consumption of beans worldwide with about 66 kg per capita per year5. Based on the population of Kabare and Kalehe and on the above consumption figure the total demand for beans is 105,332 MT per year. Therefore, there is a clear gap between supply and demand equivalent to 78,332 MT. Assuming that consumption of beans in South Kivu is equivalent to 66 kg per capita per year; the demand gap is equivalent to 49 kg per capita per year. That is why we recommend FSP to focus on improving bean production and storage to increase household consumption, affordability and income.
5 Bean Strategy for DRC and Rwanda, HarvestPlus, 2010
South Kivu Food Security Project Assesment Report on Market Systems 22 Cassava Similarly to beans, most farmers still use traditional production techniques for cassava – typically with cuttings saved from previous harvests, which have lower productivity and yields. The majority of farmers that were interviewed stated that improved cassava cuttings, such as mosaic-virus resistant cuttings, are not readily available, and in cases where they are available, they are not affordable. Use of fertilizers (organic and inorganic) is almost non-existent. Nevertheless, farmers in Katana health zone affirmed that cassava is one of the most profitable crops if sold at the right time. They consider it a major source of revenue at the household level. One of the obstacles they mentioned is lack of financial resources required to invest in cassava production. Production costs for cassava were estimated in the table below.
South Kivu Food Security Project Assesment Report on Market Systems 23 Table 3: Estimated Cost of Production for Cassava Cossettes
Current scenario Ideal scenario
Unit Total % of Unit Total % of No Item Unit Quantity Unit Quantity Price ($) Price($) expenses Price ($) Price ($) Expenses 1 Field rent (1 season) Ha 1 400.00 400 35% Ha 1 400.00 400 17% 2 Seed Ml 2,500 0.03 75 7% Ml 2500 0.03 75 3% 3 Organic manure MT 3 0.03 - 0% MT 30 10.00 300 13% 4 DAP / NPK Kg 100 0.00 - 0% Kg 0 1.50 - 0% 5 Urea Kg 50 0.00 - 0% Kg 0 1.50 - 0% 6 1st Ploughing Man day 100 1.25 125 11% Man day 100 1.25 125 5% 7 Transport of manure Man day 20 1.25 25 2% Truck 4 50.00 200 9% 8 2nd Ploughing, digging holes Man day 20 1.25 25 2% Man day 60 1.25 75 3% 9 Use of DAP fertilizer Man day 15 0.00 - 0% Man day 0 0.00 - 0% 10 Plant seeds Man day 15 1.25 19 2% Man day 30 1.25 38 2% 11 Weeding and Harrowing 1 Man day 25 1.25 31 3% Man day 60 1.25 75 3% 12 Weeding and Harrowing 2 Man day 25 1.25 31 3% Man day 60 1.25 75 3%
13 Weeding and Harrowing 3 Man day 25 1.25 31 3% Man day 60 1.25 75 3% 14 Use of Urea fertilizer Man day 30 0.00 - 0% Man day 0 0.00 - 0% 15 Earthing Man day 20 1.25 25 2% Man day 60 1.25 75 3% 16 Harvesting Man day 50 1.25 63 5% Man day 100 1.25 125 5% 17 Hulling Man day 30 1.25 38 3% Man day 60 1.25 75 3% 18 Plastic sheeting Number 6 0.00 - 0% Number 18 5.00 90 4% 19 Sorting Man day 20 0.00 - 0% Man day 0 0.00 - 0% 20 Drying of cossette Man day 20 1.25 25 2% Man day 60 1.25 75 3% 21 Bagging Man day 10 1.25 13 1% Man day 30 1.25 38 2% 22 Bag Number 120 0.50 60 5% Number 360 0.50 180 8% 23 Storage (2 months) Number 1 30.00 30 3% Number 1 50.00 50 2% Total expense (USD) 1,015 2,145 Productivity (tons per ha) 6 18
Production cost (per ton ) 169 119 Production cost (per kg ) 0.17 0.12 Profit margin in USD (20%) 0.03 0.02
Selling price (per kg in USD) 0.20 0.14
South Kivu Food Security Project Assesment Report on Market Systems 24 The table above indicates that cassava production cost is estimated to $ 0.17/kg with a margin of $0.03 leading to a selling price of of $0.20/kg in the current production situation. The ideal production situation has a high yield of 18MT of dried cossettes and the production cost is extimated at $0.12/kg with a profit of $0.02 leading to a selling price of $0.14/kg. Our field observations show that the average selling price of dried cassava cossettes is $0.34/kg during the harvest and $0.51/kg during the lean season. These figures indicate that cassava is profitable. A return on labor and land has been calculated and put into consideration due to large uncertaintaities around estimation and value on labor and wages and land value. On labor the following formula was used: (yield in kg x price per kg) - (other expenses) / (person days). The gross value obtained is the revenue that a farmet gets from the level of effort on production. On land, the following fomular was used: (yield in kg x price per kg) - (other expenses) / (1 ha). The gross value obtained depicts the revenue that a farmer derives from utilizing his land towards production. The return on labor and land in current production scenario for cassava was respectively $ 1,217 and $ 603 while in ideal production scenario was respectively $ 2,572 and $ 829. At a national level, cassava production in 2014 was 34,867,925 MT. Production in South Kivu Province was 1,349,388 MT, and 142,968 MT in Kalehe territory. Data for Kabare were not available. However Kabare is one of the biggest cassava producers especially in Katana health zone, where we have observed large quantities of cassava being supplied. Therefore, we estimate that Kabare's cassava production to be around 100,000 MT per year. The total supply for both Kabare and Kalehe is estimated to be 283,000 MT. The demand for cassava in Kabare and Kalehe is calculated based on the average of cassava consumption in DRC estimated to be 145 kg of flour per capita and per year. Based on the average consumption the demand of cassava in these two territories is estimated at 231,412 MT, which is below the supply, reason why consumers from other areas like Bukavu and Ngweshe get their supply in Kabare and Kalehe. It is worth noting that availability and reliability of data is a serious concern. Aside from cassava flour, consumers in Kabare and Kalehe use a considerable quantity of cassava leaves known as Sombe but there was no data available.
Maize For maize, use of improved inputs (improved seed and quality fertilizers both organic and inorganic) is almost non-existent. High yield varieties such hybrid maize seed are not available on the market. Skills and production techniques are limited, extension services are also limited. In Kabare and Kalehe territories, maize is mainly cultivated in Season A where farmers rely on the availability of rain. No single crop and irrigated schemes suitable for maize are available anywhere in Kabare and Kalehe. Use of mechanization is almost non-existent. Maize farmers in these two territories are not market-oriented. The table below highlights cost of production for maize.
South Kivu Food Security Project Assesment Report on Market Systems 25 Table 4: Estimated Cost of Production for Maize
Current production cost Ideal production cost Unit Total % of Unit Total % of No Activities Unit Quantity Unit Quantity Price ($) price ($) Expenses Price ($) price ($) Expenses 1 Field rent (1 season) Ha 1 200.00 200 29% Ha 1 250.00 250 14% 2 Seed Kg 30 1.20 36 5% Kg 30 1.20 36 2% 3 Organic manure Kg 2,500 0.03 75 11% Kg 10,000 0.03 300 16% 4 DAP Kg 100 0.00 - 0% Kg 100 1.40 140 8% 5 Urea Kg 50 0.00 - 0% Kg 50 1.40 70 4% 6 1st ploughing Man day 100 1.25 125 18% Man day 100 1.25 125 7% 7 Transport of manure Man day 20 1.25 25 4% Truck 2 50.00 100 5% 8 2nd ploughing, digging holes Man day 50 0.00 - 0% Man day 50 1.25 63 3% 9 Application of DAP fertilizer Man day 15 0.00 - 0% Man day 20 1.25 25 1% 10 Plant seed Man day 15 1.25 19 3% Man day 50 1.25 63 3% 11 Weeding and Harrowing 1 Man day 25 1.25 31 5% Man day 40 1.25 50 3% 12 Weeding and Harrowing 2 Man day 25 1.25 31 5% Man day 40 1.25 50 3% 13 Application of Urea fertilizer Man day 20 0.00 - 0% Man day 20 1.25 25 1% 14 Pesticide application Flat rate 0 0.00 - 0% flat rate 1 100.00 100 5% 14 Earthing (buttage) Man day 20 0.00 - 0% Man day 30 1.25 38 2% 15 Harvesting Man day 20 1.25 25 4% Man day 40 1.25 50 3% 16 Transport Man day 10 1.25 13 2% Man day 20 1.25 25 1% 17 Hulling and drying Man day 20 1.25 25 4% Man day 40 1.25 50 3% 18 Plastic sheeting Man day 2 5.00 10 1% Number 6 5.00 30 2% 19 Shelling Man day 15 1.25 19 3% Man day 40 1.25 50 3% 20 Drying of maize grain Man day 10 1.25 13 2% Man day 20 1.25 25 1% 21 Bagging Number 4 1.25 5 1% Man day 20 1.25 25 1% 22 Bags Number 24 0.50 12 2% Number 80 0.50 40 2% 23 Fumigation Flat rate 0 0.00 - 0% Flat rate 1 50.00 50 3% 24 Storage (2 months) Number 1 30.00 30 4% Number 1 50.00 50 3% Total expense 693 1,829 Productivity (tons per ha) 1.2 4
Production cost (per ton ) 578 457 Production cost (per kg in USD) 0.58 0.46 Profit margin in USD (20%) 0.12 0.09 Selling price (per kg in USD) 0.69 0.55
South Kivu Food Security Project Assesment Report on Market Systems 26 Based on the above table, the production cost for maize is estimated to be $0.58/kg with a profit margin of $0.12 and selling price of $ 0.69/kg under current production conditions. The ideal production cost is $ 0.46/kg with a profit margin of $ 0.09 and selling price of $0.55/kg. During the field visit, average maize price was $0.34/kg at harvest and $0.51/kg during the lean season. The calculated selling price at farm gate is above market price, which may lead one to assume that maize is not profitable. However, if investments are made to improve maize productivity, this value chain can be profitable as it is the case in other countries. A return on labor and land has been calculated and put into consideration due to large uncertaintaities around estimation and value on labor and wages and land value. On labor the following formula was used: (yield in kg x price per kg) - (other expenses) / (person days). The gross value obtained is the revenue that a farmet gets from the level of effort on production. On land, the following fomular was used: (yield in kg x price per kg) - (other expenses) / (1 ha). The gross value obtained depicts the revenue that a farmer derives from utilizing his land towards production. The return on labor and land for maize in current production scenario was respectively $ 830 and $ 339 wihle in ideal production scenario was respectively $ 2,192 and $ 616. On the side of supply, DRC produce 2,015,345 MT of maize at the national level while in South Kivu Province, the production of maize is 27,903 MT. Maize production data for Kalehe and Kabare was not available during our field visit therefore making it difficult to estimate maize supply in these two territories.
In Kabare and Kalehe territories, maize is mainly consumed fresh, which makes it hard to estimate the real demand. However, some household in Kabare and Kalehe consume maize four as substitute of cassava flour. Data available do not indicate the consumption of maize in DRC. However based on the data for countries with similar eating habits, like Uganda where the maize consumption is 50 gr per day per capita equivalent to 18 kg per year per capita, we can make calculation of maize demand in Kabare and Kalehe as we know their population. Therefore the potential demand is estimated at 287,270 MT.
Onions Unlike other crops, onions are cultivated only in certain areas such as Miti-Murhesa and Katana where they are suitable. Farmers have devised means of acquiring onion seed through informal channels. Some are bought from local markets while others obtain seed from neighboring countries like Rwanda and Uganda. Extension services are almost non-existent and skills in production techniques are very limited. As observed during our field visits, the majority of farmers harvest onions prematurely.. AGRIFORCE in collaboration with One Acre Fund have started to introduce improved varieties and production techniques with the aim of help farmers to improve productivity however the approach used need to be revisited in order to meet farmers’ concerns and needs. Nevertheless, this study observed that onion farmers are market-oriented in spite of all challenges they face. The table below highlights production cost for onions.
South Kivu Food Security Project Assesment Report on Market Systems 27 Table 5: Estimated Cost of Production for Onions
No Item Unit Quantity Unit Total % of Unit Quantity Unit Total % of Price ($) price ($) Expenses price ($) price ($) Expenses
1 Field rent (1 season) Ha 1 200.00 200 22% Ha 1 250.00 250 13% 2 Seed Kg 2 80.00 160 18% Kg 2.5 80.00 200 10%
3 Organic manure Kg 2,500 0.03 78 9% Kg 10,000 0.03 300 16%
4 Kg 20 0.00 - 0% 20 1.40 1% DAP Kg 28 5 Urea Kg 20 0.00 - 0% Kg 20 1.40 28 1% 6 1st ploughing Man day 100 1.25 125 14% Man day 100 1.25 125 7% 7 Transport of manure Man day 20 1.25 25 3% Truck 2 50.00 100 5% 8 2nd ploughing, digging holes Man day 50 1.25 63 7% Man day 50 1.25 63 3%
9 Application of DAP fertilizer Man day 15 0.00 - 0% Man day 20 1.25 25 1%
10 Plant seeds Man day 60 1.25 75 8% Man day 80 1.25 100 5% 11 Weeding and Harrowing 1 Man day 25 1.25 31 3% Man day 90 1.25 113 6% 12 Weeding and Harrowing 2 Man day 25 1.25 31 3% Man day 50 1.25 63 3% 13 Weeding and Harrowing 3 Man day 25 1.25 31 3% Man day 50 1.25 63 3%
14 Application of Urea fertilizer Man day 30 0.00 - 0% Man day 20 1.25 25 1%
15 Man day 20 1.25 25 3% 45 1.25 3% Loosening Man day 56 16 Harvesting Man day 40 1.25 50 6% Man day 60 1.25 75 4% 17 Plastic sheeting Number 10 0.00 - 0% Man day 0 0.00 0% 18 Triage Man day 20 0.00 - 0% Man day 0 0.00 0% 19 Drying of onions Man day 5 0.00 - 0% Man day 10 1.25 13 1% 20 Bagging Man day 15 0.00 - 0% Man day 30 1.25 38 2% 21 Bags Number 30 0.00 - 0% Number 10 10.00 100 5% 22 Storage (2 months) Number 3 0.00 - 0% Number 3 50.00 150 8% Total expense 894 1,912 Productivity (tons per ha) 7 20 Production cost (per ton ) 128 96 Production cost (per kg ) 0.13 0.10 Profit margin in USD (20%) 0.03 0.02
Selling price 0.16 0.12
South Kivu Food Security Project Assesment Report on Market Systems 28 From the table above we observe that onion production cost per kilogram is estimated at $0.13 with profit margin of $0.03, leading to a selling price of $ 0.16 under current production conditions. The ideal cost of production is $ 0.10/kg, with a margin of $0.02 and a selling price of $0.12/kg. During our field visit we noted that the average onion salling price is $0.17/kg at harvest, while during the lean season the average is $0.33/kg, nearly double the price at harvest. Thus, onions are profitable, especially when stored and sold during the lean season. A return on labor and land has been calculated and put into consideration due to large uncertaintaities around estimation and value on labor and wages and land value. On labor the following formula was used: (yield in kg x price per kg) - (other expenses) / (person days). The gross value obtained is the revenue that a farmet gets from the level of effort on production. On land, the following fomular was used: (yield in kg x price per kg) - (other expenses) / (1 ha). The gross value obtained depicts the revenue that a farmer derives from utilizing his land towards production. The return on labor and land in current production scenario for onions was respectively $ 1,072 and $ 379 wihle in ideal production scenario was respectively $ 1,000 and $ 632. Data on onion production at national, provincial and territory level are not available, or is it easy to evaluate and quantify the onion supply in Kabare and Kalehe territories. However, we should base our estimation on the data collected in the field, indicating that during the abundant periods of November/December and March/April for Miti Murhesa zone, farmers can easily supply an average of one small truck or about 10 MT for each market day. Based on this information and considering that the Mudaka market is bi-weekly, we can estimate the supply in Miti Murhesa to be 320 MT per year. In Katana, onions are mainly produced in July/August and September/October, and during this period, farmers around the bi-weekly Katana market also supply about 10 MT per market day, implying a similar rate of production. Onion production in Kalehe is marginal and difficult to estimate. Based on the above assumptions and field observations, the supply of onion in Kabare and Kalehe can be estimated at 700 MT per year.
There is limited data available on onion consumption in DRC in general and in South Kivu in particular. Data available for neighboring countries of Angola and Congo Brazzaville show that their onion consumption per capita per year is respectively 0.4kg and 2.3kg. By assuming that DRC has similar eating habits to Congo Brazzaville (on the conservative end), we can estimate onion demand for Kabare and Kalehe using data for Congo Brazzaville to be 3,671 MT per year. Therefore, it’s likely that onion demand in Kabare and Kalehe exceeds by 5 times or more the available supply.
Farmers’ Organizations In South Kivu Province, farmers can be organized either as non-profit associations or for-profit cooperatives. To be registered as an association or a cooperative, there are certain conditions that are required to fulfill in order to operate legally. Firstly, for both categories statutes and internal regulation documents are required. Secondly, farmers must submit in writing a request
South Kivu Food Security Project Assesment Report on Market Systems 29 to the official in charge of rural development at the territory level, who verifies the existence of the group. When all requirements are met, the local authority provides a temporary agreement to operate legally. Territory officials submit the temporary agreement to the provincial authority in charge of associations and cooperatives (rural development department), which in turn submits it to the provincial ministerial cabinet for temporary approval at the provincial level. When the provincial temporary agreement is obtained, a request for permanent agreement is submitted to the Ministry of Justice and Planning at the national level in Kinshasa for final approval. This long and bureaucratic process, based on laws dating from the 1960s, can slow or discourage the creation of associations and cooperatives. During our field visits in Kalehe territory, we observed that farmers are more organized in cooperatives than in Kabare. According to the official in charge of rural development in Kalehe, there are about 50 agricultural cooperatives and 120 farmers’ associations in Kalehe territory. Notably the Union des Cooperatives Agricoles de Kalehe (UCOAKA), is comprised of 12 member cooperatives grouping a total of 691 farmers located in different localities. This is a good example demonstrating how farmers can be united into an umbrella organization in order to provide much needed services to their members. UCOAKA is involved in seed production and distribution, agriculture extension, storing farmers’ produce and marketing. The table below shows the cooperatives grouped in UCOAKA Union. Table 6: List of member cooperatives of UCOAKA Union in Kalehe
Cooperative Name Location Men Women Youth Total
01 MAENDELEO BUZIRALO 10 15 10 35 02 RHUGWASANYE MULEBA 10 14 8 32
03 RHUJEMBERE BUZIRALO 30 43 23 96
04 BULANGALIRE MUNANIRA 10 45 15 70
05 GEV MUHONGOZA 47 70 13 117
06 COACLWA NYAMUKUBI 22 35 3 60
07 ACOPAIDEC 40 60 100 08 USHIRIKA/COODAK BUJUKI 25 32 10 67 09 CATM MUHONGOZA 4 24 32 10 MAJIRANE KALEHE 7 36 7 50 11 PRODES KALEHE
12 CODEVI BUDJUKI 12 15 5 32
In Kabare, there are also farmers associations and cooperatives like BAZIRE RHUHEKEKUGUMA, which is a women-owned cooperative with 70 members including 29 young mothers under 30 years of age. They are involved in beans and Irish potato production. Another example is the BAZIRE NYANYA association with 100 members, of which 20 are
South Kivu Food Security Project Assesment Report on Market Systems 30 youth (16-35 years). This association is involved in production and marketing of beans, soybeans, some processing like doughnuts and soymilk processing. Both of these associations are involved in credit and savings schemes (VLSA), storage, and grouped sales (which increases their bargaining power). In the Mudaka area, a youth group called Association des Jeunes pour la Paix is involved in agriculture, mostly in onion production and sales. During our field visits, we observed a gap in farmers organizations focused on cassava and onion. Farmers’ organizations in both Kabare and Kalehe could be better organized in order to provide much needed services such as access to inputs, access to extension services, storage and post-harvest facilities, marketing, access to finance and advocacy.
Farmer’s Access to Finance There are few financial institutions (PAIDEC - Kalehe, PAIDEC - Kavumu, PROCREDIT) and according to farmers, the provided services are limited and expensive. For example, PAIDEC provides only credit services at an interest rate of 2-3% per month or 24-36% per year. The high interest rates of 1.7-2.5% per month or 20.4-30% per year are also observed with PROCREDIT. According to the manager of PAIDEC Kalehe, for a portfolio of about $100,000 allocated to the agriculture sector, 90% goes to agribusiness and only 10% to farming, primarly coffee production. Interviews with the PAIDEC Kalehe Branch Manager and PROCREDIT Bukavu Branch Manager indicated that financial institutions consider agriculture as a high-risk sector.This limited access to finance has an impact on crop production, since most of farmers can't buy improved agriculture inputs due to lack of funds. Key Interventions on Agriculture Production Techniques and Access to Agriculture Services 1. Organize farmers in association and cooperative whereby they can easily receive extension services 2. Develop appropriate training materials and provide timely trainings on agriculture best practice 3. Facilitate farmers’ access to inputs and to financial services especially through associations and cooperatives 4. Promotion of mechanization, irrigation and mobilization of more investors in agriculture 5. Advocacy to the public and private actors for the establishment of incentives mechanisms to motivate agricultural extension agents 6. Sensitize and mobilize concession owners to allow smallholder farmers around them to use their land under fair contractual agreements (through win-win situations) 7. Create farmers awareness for group selling of their produce to increase their bargaining
power 8. Promote high yield, high value and nutritious crops to increase farmers’ income and nutrition
South Kivu Food Security Project Assesment Report on Market Systems 31 3.2.3. Post-harvest and handling techniques Post-harvest and handling techniques play a key role in commodity quality and loss control. Even though some post-harvest activities are common for most commodities, others are particular to specific commodities. For instance, activities involved in cassava post-harvest include harvesting, grading/sorting, retting, peeling, drying, pounding, packaging/bagging, loading and unloading, transport and storage while maize and beans post-harvest activities consist of harvesting, drying, threshing, shelling, winnowing, fumigation, packing and bagging, loading and unloading, transport and storage. During post-harvest and handling operations, losses are mainly caused by moisture content and spoilage, insect and animal damage, molds, breakage, poor packaging, transport and storage conditions. In Sub Saharan Africa, post-harvest and handling losses are estimated to be 15-45 % depending on the type of product, whereby horticulture products are the most vulnerable due to their perishability6. The lack of knowledge of improved post-harvest handling practices and access to appropriate equipment for harvesting, threshing, drying, packaging, and storage leads to quantitative, qualitative and nutritional losses. Quantitative loss refers to the reduction in weight (independently of drying) of products, which can be defined, quantified and valued. For instance, a portion of produce eaten by insects, rodents, or lost during spillage or transportation would be a quantitative loss. Qualitative loss implies the damage or contamination of the commodity, and this type of loss is usually described by comparison with quality standards, while the reduction of a crop’s nutritional value is also called the nutritional loss. All these types of losses are frequent in South Kivu province.
3.2.3.1. Harvesting and drying
Harvesting is a critical crop management phase, which requires specifically adapted methods to preserve product quality. During this phase, many factors must be taken into account to optimize costs and maximize agricultural profits. In Kabare and Kalehe, farmers use different ways to harvest their agricultural produce. They use traditional methods (using hands, hoes and machetes) to detach the cob from maize plants and for uprooting cassava, beans and onions. According to the farmers’ organizations interviewed during this assessment, maize and onions are mostly sold fresh in Kabare and Kalehe while beans and cassava are sold dried or after processing into flour (cassava and some maize). Farmers and other actors in commodity value chains use different methods and tools to dry cassava, beans and other commodities. Farmers dry cassava, beans, maize, and onions on the ground or roofs sometimes using mats or sheeting. These methods rely almost exclusively on natural drying of crops from a combination of sunshine and airflow, and farmers report that they usually take 1-2 weeks depending on the availability of sunshine. Farmers mentioned also that in some cases, they face a problem of sunshine deficiency in season A, causing losses of
6 NIRDA, Feasibility study for the establishment of Rwanda Institute of Food Technologists, 2017.
South Kivu Food Security Project Assesment Report on Market Systems 32 their commodities. Some farmers harvest, peel, dry and sell cassava on farm, as it was observed in Kalehe. This study established that there is a lack of improved drying facilities (halls, automated drying units, sheeting, etc.), which affects the quality of produce and its competitiveness. Drying conditions are not good and farmers lack tools to test moisture content, and when commodities are stored with a high level of moisture, they develop rot, mold and aflatoxin contamination thus loose the required market quality. The pictures below illustrate this situation.
Figure 6: Poor cassava drying conditions in Kalehe It is important to note that there are appropriate mechanized drying systems for maize, beans, and soybeans, which can dry about 15 MT/hour.
3.2.3.2. Packaging, transport and storage
To transport their produce from field to home or market, farmers use manpower and some have to walk long distances carrying baskets and bags or using wheelbarrow, bicycles, and rarely vehicles as transport means. Small traders use the same transport means as farmers while major traders use motorcycles, trucks and boats. Packaging is mostly done in plastic bags. In rural areas, transport using bicycles and vehicles faces big challenges due to the almost inexistence or poor condition of feeder roads, which has a direct impact on the transport cost. Farmers and small traders walk long distances with heavy loads on their heads or backs from their home to the marketplace. The case a young women’s traders group is a good example: these young women leave their home at 3 a.m. and walk from Ihusi (Kalehe) to Bunyakiri through Kahuzi Biyega Park to buy beans, and then return home at 9 pm, putting in an 18-hour day. The main road connecting Kabare and Kalehe to Bukavu and Goma cities is also in bad conditions in some parts and this is reflected on the competitiveness of commodities from these territories. With regard to commodities handling, major challenges encountered are large bags used in packaging with an excessive weight (100Kg and above) difficult to handle especially for
South Kivu Food Security Project Assesment Report on Market Systems 33 women, and poor quality of bag stitching which is a source of physical losses during transportation. 54.5% of interviewed traders use new bags, while 31.7% use reconditioned bags. It is highly recommended to use new and well-closed bags with a reasonable weight not exceeding 50Kg or 25Kg for easy handling. This study observed that traders use mainly vehicles/trucks (100%) for commodities transport, followed by carrying on foot /on head (53.3%), boat (33.3%) and bicycle/motorcycle (25%) as indicated by the figure below.
Boats, 33.3
Vehicles/Truck s, 100
Motorcycle/Bic ycles, 25
Head, 58.3
Figure 7: Commodities' transport means in Kabare and Kalehe
Generally, boat transport cost is cheaper than vehicle and motorcycle. Traders and farmers near Lake Kivu prefer to use boat to transport their commodities to markets located nearby the lake, including Bukavu and Goma urban markets. Lake transport is also more organized than road transport. Trucks used in commodities transport are old and in many cases are overloaded. Transporters (on lake and road) who were interviewed complained about the red tape that they are subjected along those routes. They pay unnecessary taxes, fees and levies, which has led some of them to be discouraged, declare bankruptcy. This has a negative repercussion on the cost of transport, thus making products more expensive. In Kalehe and Kabare there is no railway for transport whereas such a facility could be useful and cheaper in connecting remote areas of a vast country like DRC. However, Kavumu airport in Kabare territory connects Bukavu City/ South Kivu Province to other Cities/Provinces including Kinshasa, the biggest market in DRC. This airport constitutes a transport opportunity for South Kivu high value-low volume commodities. To overcome the poor condition of transport of commodities and therefore increase their competitiveness, the provincial road network should be rehabilitated and supported by the creation of feeder roads that are needed in production areas.
Storage The overall purpose of any storage facility (for beans, soy beans and maize grains, cassava cossettes or cassava flour, onions, etc.) is to maintain the stored commodity in good condition so as to avoid its deterioration both in quantity and quality but ultimately prolong shelf-life of
South Kivu Food Security Project Assesment Report on Market Systems 34 the stored commodity. To retain quality in storage producers must have appropriate facilities, knowledge and skills. In Kabare and Kalehe territories, the majority of farmers face the problem of lack of storage facilities and thus sell off their produce at lower prices soon after harvesting due to anticipated post-harvest losses. Later, these same farmers buy these needed commodities at higher prices. For instance during this assessment, it was observed that in Kalehe territory/Ihusi market, bean prices almost tripled from $0.47 per namaha (a small bowl used as a standard measure in the area) during harvest period to $1.4 per namaha during shortfall period. The challenge of appropriate storage facilities is also observed at the traders’ level, causing losses for their business especially when they have to store their products for a long time.
Figure 8: Poor hygienic conditions in cassava storage
Figure 9: Improved storage systems
This study found that traders in Kabare and Kalehe use their own houses and small shops as storage facilities with limited storage capacity and poor conditions. Only two storage facilities were identified in Kabare and Kalehe territories. One is located at Ihusi market in Kalehe and
South Kivu Food Security Project Assesment Report on Market Systems 35 belongs to UCOAKA. This facility was built with World Vision support and has a capacity of 250 MT. The other storage facility made of 12 silos of 80 MT each is located in Birava in Kabare. This storage facility, which is 30 years old, was built with support from the Italian Cooperation with a total capacity of 960MT. The challenge of storage facilities was confirmed by the majority of respondents, who indicated that they don’t have facilities where they could keep their products before selling them. 62% of interviewed actors in Kabare and Kalehe markets indicated that they do not store their products before they are sold, 75% of respondents confirmed that exiting storage facilities are not sufficient to meet demand, and 67% believed that facilities do not meet quality standards.
Percentage of Sellers who store their products before they are sold in Kabare and Kalehe Markets areas
Yes 38%
No 62%
Figure 10: Storage of agricultural products before they are sold
Sufficiency of storage facilites in Kabare and Kalehe market areas
Yes 25%
No 75%
Figure 11: Availability of storage facilities in Kabare and Kalehe
It is recommended that government and private sector actors in South Kivu invest in appropriate storage facilities in order to avoid post-harvest losses, tackle price fluctuation and enable the availability of commodities to the population.
South Kivu Food Security Project Assesment Report on Market Systems 36 The pictures below illustrate some transport and handling systems.
Figure 12: Difficult conditions of handling and transport in Kabare and Kalehe
Key Interventions on Post-harvest and handling techniques
1. Training farmers and traders on post-harvest and handling best practices techniques 2. Sensitize Government and private sector to invest in post-harvest facilities including drying and storage facilities
3. Facilitate farmers and traders access to post-harvest materials and equipment and to credit services especially through associations and cooperatives 4. Promotion of warrantage system helping farmers to access finance and storing their produce 5. Organize transporters for better services 6. Increase farmers’ awareness on storing their produce and sell them when price is high 7. Enforcement of quality and hygienic standards for commodities
3.2.4. Agro-Processing in Kalehe and Kabare 3.2.4.1. Processing Facilities Agro-processing provides opportunities to increase income for smallholder farmers, processors and traders. During our study, our team assessed agricultural processing within the market systems in Kabare and Kalehe territories. In South Kivu Province, there are a number of commodity processing facilities and most of them are small milling machines concentrated in Bukavu City and around shopping centers and markets. Processed products are mainly cassava, sorghum, maize and soybeans. In Bukavu City, Olame Centre is one of the biggest and experienced units in commodity processing. It can process and produce different kind of products including mixed “Masoso” flour (Soy bean, maize, and sorghum), soy flour, maize flour, sorghum flour, Tamu and Masoso biscuits. The processing capacity of Olame Centre is estimated to be around 16MT
South Kivu Food Security Project Assesment Report on Market Systems 37 per week. However, during this assessment, it was found that this processing unit was not working due to lack of operating capital, even if their products such as nutritional Masoso flour have high market potential considering the high rate of malnutrition and stunting in South Kivu households. The study observed that Olame Centre operates more like an NGO than a business. At Kalambo in Kabare territory, with funding from the World Bank and the African Development Bank (ADB), the International Institute of Tropical Agriculture (IITA) supports a group of young entrepreneurs (IYKA) to manufacture processing materials/equipment and process some commodities. Created in 2013, IKYA has 20 members and they produce flour from cassava, maize and soybeans as well as yoghurt, biscuits and tofu. IKYA products are of good quality but the processing capacity is still limited. They can only process 4MT of Cassava, 1.5 MT of maize and 0.359MT of soybeans per week. It is important to note that IKYA coaches other 14 youth groups in Bukavu City, Kabare, Walungu and Rusizi Plain. In the FSP zone, there are 5 groups coached by IKYA. These groups are involved in production of soybeans, cassava, maize and beans (in Ruhihi and Kavumu) as well as cassava processing (Katana). This assessment observed that in Kabare and Kalehe territories, milling machines are available at each marketplace. Micro and small transformation units dominate the processing activity, with cassava as major processed crop.
Types of agro-processing units in Kabare and Kalehe
Medium 40% Micro/sm all 60%
Figure 13: Size of agro-processing units in Kabare and Kalehe
Others 20 Cassava 60 Maize 20 Processed products in Kabare and Kalehe
0 20 40 60 80
Figure 14: Processed products in Kabare and Kalehe (in %)
South Kivu Food Security Project Assesment Report on Market Systems 38 Processors use electrical power or diesel as source of energy. The table below indicates the number of milling machines at the markets visited.
Table 7: Number of milling machines at the visited markets
No Market Number of milling machines 1 Mudaka 15 2 Kavumu 12 3 Katana 70 4 Birava 11 5 Nyabibwe 6 6 Kabamba 23 7 Nyamukubi 7 TOTAL 144
This study has established that there are no processing units for beans or onions in Kabare and Kalehe. Processed beans have potential especially in urban areas such as Bukavu, Goma and Kinshasa. Pre-cooked beans have the advantage to be cooked with less wood, charcoal, electricity or gas. Onions can be dried and processed as a raw material in processed foods.
3.2.4.2. Processing constraints Most of the buildings that host processing machinery in Kabare and Kalehe are not appropriate for food processing and lack hygiene and quality standards. The majority of the processing machines operating in Kabare and Kalehe are substandard, made of steel, which is not recommended for human food processing machines. They should use stainless steel machines to comply with food processing quality standards. Also, the raw materials (cassava, maize, sorghum, soy) used in these processing units are of varying quality and there is no mechanism to measure or monitor the required standard for human food products. Storage facilities are also inadequate, and some products are stored on the floor. There is a need to promote knowledge-based processing and quality analysis tools. Processors in Kabare and Kalehe should be trained on basic hygiene and quality management, especially Hazard Analysis Critical Control Point system (HACCP) in order to improve on the quality of their products. The pictures below illustrate the situation.
South Kivu Food Security Project Assesment Report on Market Systems 39
Figure 15: Poor processing conditions
We observed that 80% of processors in Kabare and Kalehe areas face a problem of underutilization of their installed capacity for their processing units due to a multitude of factors such as lack of raw materials, electrical power shortages and lack of working capital funds as indicated in the figure below.
Lack of working capital, 20 % Lack of electrical power, 20 % Insufficiency of raw materials, 40 %
Figure 16: Major processing constraints expressed by processors in Kabare and Kalehe (in %)
In addition to the underutilization of existing facilities, processors of agricultural products in Kabare and Kalehe indicated that they face other challenges, which constrain the optimization of their businesses, including prohibitive taxes (80%), limited access to transport and to financial services (60%). Limited access to storage facilities, limited processing technology and problem of market access for processed products were also indicated by interviewed processors in Kabare and Kalehe as challenging factors that slowdown the optimization of their businesses as indicated on the figure below.
South Kivu Food Security Project Assesment Report on Market Systems 40 Access to market
Access to processing techniques
Access to storage systems
Access to transport
Access to financial services
Insufficiency of raw materials
High taxation
Access to packaging materials
0 10 20 30 40 50 60 70 80 90
Figure 17: Key challeges faced by agro-processing in Kabare and Kalehe and their importance expressed in percentage
3.2.4.3. Processing Technology and Product Diversification Apart from the constraints stated above, almost all processors in South Kivu lack product diversification. They all produce same products (cassava flour, maize flour and soy beans flour) except Centre Olame and IKYA that produce other products such as mixed flour, biscuits, tofu and yoghurt. However, technologies exist to process and make various products from one or more combination of different commodities. For instance, composite flour can be obtained from a mixture of cereal flours (e.g. maize, rice, millet, wheat), tubers (e.g. cassava, sweet potato) and legumes (e.g. soy, peanut). These types of crops are diversely rich in proteins, carbohydrates and fats; therefore the use of maize, sorghum, cassava and /or soy beans for production of composite flour would help to improve South Kivu nutritional status especially for pregnant and breastfeeding women and under-age children. Moreover, various products can be developed from one commodity. This is applicable to cassava, maize, soybeans and other crops. For example, the following products can be developed from maize: - Puffed and popped maize - Infant foods - Maize bread - Biscuits - Breakfast cereals such as Corn flakes - Pasta (Macaroni) - Ethanol or Gasohol - Brewing (Grits) - Starch - Syrups and sugars (Sweeteners)
South Kivu Food Security Project Assesment Report on Market Systems 41 - Corn oil - Animal feed compliments This assessment suggests that large and complete processing units are needed to process cassava, maize and soybeans in South Kivu and particularly in Kabare and Kalehe territories to produce quality and quantity required for global competitiveness.
3.2.5. Packaging and Storage Systems The majority of processing units in South Kivu use bags of 50kg – 100kg to package their products. Most of these bags are made of polyethylene and imported from China, Kenya, Dubai, Uganda and Rwanda. Some processing companies like Centre Olame and IKYA use different types of packages weighing down to grams. As far as packaging is concerned, it is important to highlight the necessity of standard labelling, which many processors do not respect. This labelling should indicate the following information: - The name of company - The address - Weight - Nutritional characteristics of the product - Production batch number - The expiration period of the product
Key Interventions on Agro-processing
1. Trainings processors on quality of processed food and hygienic required for human food 2. Mobilize government and private sector to invest in cassava, maize, beans and soy beans processing units and produce quality food 3. Advocacy to government and private sector to invest in electrical power production required for processing investment
4. Promotion of the use of small and medium quality milling machine and quality measurement tools 5. Promotion of the use of quality packaging 6. Link processors to product developers for diversification of processed products 7. Sensitize banks to facilitate processors’ access to finance (loan for investment and working capital) 8. Link processors to farmers and traders for raw material supply in quality and quantity 9. Link processors to markets
South Kivu Food Security Project Assesment Report on Market Systems 42 3.2.6. Marketing of Commodities in South Kivu - Kabare and Kalehe
Market actors in Kabare and Kalehe Different actors participate in the commodity market chain, including farmers, farmer organizations (cooperatives and associations), collectors, traders (semi-wholesalers, wholesalers, importers, exporters and retailers, transporters, processors and consumers. In most cases, farmers sell individually their produce at farm or household level to collectors or on the local market to buyers. Farmer's organizations are limited in number and not involved in providing much needed services, which weakens farmers' bargaining power. Farmers don’t know how to calculate their cost of production nor how prices are determined; they lack units of measurement and basic storage facilities; can’t produce quantities and quality needed by the markets; and may not know the final destination of their products. Collectors play a role of gathering agricultural products from villages to local market where they sell them to different traders. Frequently, collectors act as intermediaries between traders and farmers. Traders advance collectors with cash to buy from farmers. What is evident is that there are many intermediaries in the markets, which can have a negative impact on the farmer incomes: reducing the number of intermediaries would mean more money in the hands of producers. In Kabare and Kalehe, there are different categories of traders including small and medium- sized wholesalers and retailers. Some of these wholesalers have small shops while others store products in containers; most hold stocks between 1 MT to 50 MT for up to a week. They buy produce from farmers, small traders or collectors using their own cash, then sell directly to local retailers, small processing units or other traders that can take their produce to other bigger markets like Mudaka, Katana, Ngweshe, Bunyakiri as well as Bukavu which is a big consumer market destination (Muhanzi and Kadutu). Wholesalers are mainly present in bigger markets because of the volume of produce these markets can hold. However, there are other smaller markets like Nyabibwe, Nyamukubi, and Chabwenemwami that play a role of feeding bigger markets with produce. Transporters play an important role when it comes to moving commodities from one location to another. The majority of farmers and small traders use person-power to move commodities from their locations to local markets, while a few use bicycles or motorcycles. Some traders use old 10-20 ton trucks to move commodities from market to market, and those living around Lake Kivu use boats to transport goods. Smaller motorized wooden boats, even fishing boats, move goods from one location to another, while larger metallic boats travel from Bukavu to Goma with several stopovers to collect commodities that are destined to bigger markets. Of all these modes of transport, lake transport is the cheapest but not available to all. The study found that boat transporters are better organized than road transporters. Retailers are present almost in every market, trading centers and villages. They may have a small shop or a stall in the market where they sell the produce. They buy and sell in small quantities, using rudimentary units of measurement such as a plastic bowl known as “namaha,” bunches, or single units.
South Kivu Food Security Project Assesment Report on Market Systems 43 Another category of market actors are processors. As described above, most processors in Kabare and Kalehe have micro or small processing units, especially grain mills. The last category of market actors is consumers, both rural and urban households who are primarily consuming what is available in the market. They are the main drivers of the demand and play an important role in the market system. Other consumers include hotels and restaurants, schools and universities, army and police barracks, prisons, NGOs and other relief agencies.
Supply & Demand Trends As stated above, local production of food in DRC is insufficient to meet demand, and the deficit between food production and food demand is filled by imports. The most cited determinants of low productivity include low level of public and private investment in agriculture, malfunction of the markets of agricultural products due to deterioration of agricultural feeder roads, weak human and institutional capacity and lack of coordination of the activities of the sector, lack of support services to agricultural sector activities such as research, extension, information and credit, absence and/or inefficient input markets as well as the use of undeveloped technologies and practices.
Figure 18: Sellers in open-air market place selling onions, maize and beans in Kabare and Kalehe
On the other hand, one may observe the weakness of demand, which (according to traders interviewed) is a result of low purchasing power of the population and insecurity, which are seen as the major obstacles to developing markets in South Kivu. This study has observed that farmers in Kabare and Kalehe have concerns about low prices of their produce during the harvest period. As stated above, price depends on the principle of supply and demand, and due to the fact that crop production has a seasonal pattern, farmers sell when prices are low because supply exceeds demand during the harvest period. Seasonal price fluctuations of key crops are shown in the table below.
South Kivu Food Security Project Assesment Report on Market Systems 44 Harvest vs. Shortfall Prices Harvesting price Shortfall price
1577 1498
946 896 873 818
542 542 452 283
Beans Maize Cassava Onion Others
Figure 19: Harvest versus shortfall periods buying price (in CF) in Kabare and Kaleheehe
Key Interventions on Marketing of Commodities 1. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments 2. Facilitate access to standardized measurement tools and instruments 3. Promote the enforcement of the use standardized measurement tools and instruments 4. Provide market information to all market actors though innovative web-based and mobile applications, media and bill boards 5. Introduce and promote innovative model such as contract farming 6. Sensitize banks to facilitate all market actors’ access to finance (loan for investment, working capital and deposit services 7. Capacity building to reinforce the role of markets committees 8. Sensitize market actors to use digital finance tools such as mobile money payment 9. Promote an organized transport system
South Kivu Food Security Project Assesment Report on Market Systems 45 CHAPTER 4: MARKET SYSTEMS IN KABARE AND KALEHE 4.1. Overview of Market Systems in South Kivu - Kabare and Kalehe 4.1.1. Definition of a Market System According to Ruth Campbell (2014), the market system is "a dynamic space - incorporating resources, roles, relationships, rules and results- in which public and private actors collaborate, coordinate and compete for the production, distribution and consumption of goods and services". The market system includes all the firms in interrelated value chains - inputs providers, producers, traders, processors, wholesalers and retailers, the supporting services (e.g. finance, transport, information services) for those actors, and the formal and informal enabling environment in which they operate. The relationship between these actors helps to determine the efficiency of the system. The elements of the market system comprise actors or participants (producers, traders, transporters, consumers, government, etc.), infrastructure (market buildings and stalls, storage facilities, road networks, etc.), information medium (bulletins, radio broadcasts, informal exchange, etc.), supporting services (financing, handling, transporting, storing commodities, etc.), business relationships (contracts, agreements, familial and informal networks, etc.), decisions and strategies (transactions, purchases, sales, provision of services, etc.), legal framework and norms (grades and standards, property and contract laws,) licensing and taxes.
South Kivu Food Security Project Assesment Report on Market Systems 46 Kabare-Kalehe Market System Mapping
Figure 20: Map of Market System In Kabare and Kalehe
Related services Input suppliers and Coordination SUPPORTING FUNCTIONS Skills & Capacity Extension services distribution, transport Market committees R & D Information (Agronomist, NGOs, service, finance service, and Sub-committees, Improved seed Market information (mobile Government), Market payment service, CARG, FEC, local varieties (INERA, IITA, telephone, market information electricity and water, board, radio, word of mouth, management, Contract government Havest Plus, handling, packaging, announcement, news papers, negotiation and Universities), IPM, storing, accreditation and promotion) enforcement, business Fertilizer production, certification Products development, post-harvest diversification and handling practices, quality and standards Infrastructure Shelter, shops, norms marketing warehouses, silo, knowledge Informing & Communicating Demand roads, electricity and Households, water facilities, schools and Supply universities, hotels Farmers, farmers and restaurants, cooperatives and military and police associations, collectors, camps, CORE processors, small traders, semi- traders, exporters, Demand FUNCTION Supply wholesalers, NGOs and relief wholesalers, processors, agencies, cross importers border traders
Setting and enforcing rules Regulations & Policy Rules & Norms Agriculture policy Land acquisition (CAADP, NAIP), (chefferie and Industrial development government), gender policy, export policy, norms, conflict Taxation (FEC, ASI, Laws resolution, tax fraud, associations) Land reform, peace building, Land access and Standards customary norms National, regional, contracts, International Conflict resolution standards (OCC, SQAV) South Kivu Food Security Project Assesment Report on Market Systems 47
4.1.2. Market System Environment
The market system environment in Kabare and Kalehe is shaped by various elements such as market supporting rules (policies and regulations), demand-supply trends, traders’ organizations, supporting infrastructure, supporting services as well as social and business practices. 4.1.2.1. Supporting Rules The market system supporting rules are formal and informal mechanisms that drive the motivations and conduct of market actors in the market system. These comprise laws, regulations, standards, values, relationships and social norms. The formal mechanisms are applied at national or/and international level while values and social norms are valid for a given group or area. The following section highlights the market system environment in South Kivu regarding laws, regulations, policy and standards. 4.1.2.1.1. REGULATION AND POLICY
The main elements of regulations and policy for the agriculture market system in South Kivu are agriculture policy and financing, industrial development policy, export policy and the policies that relate to business enabling environment.
Agriculture policy The government of the Democratic Republic of Congo (DRC)’s agriculture sector policy is guided and informed by the Comprehensive African Agricultural Development Program (CAADP). To comply with CAADP, the Democratic Republic of Congo officially launched their CAADP program in 2010 with the support of COMESA (Common Market for Eastern Africa of the East and Southern Africa).7 In alignment with the core principles of CAADP, the National Agricultural Investment Plan (NAIP) was developed as the DRC's national planning framework for domestic and foreign investment in the agriculture sector and rural development sphere. It takes into account the needs, achievements and gaps in regard to the agriculture sector and provides a blueprint for the investment and operation of the sector over a period of eight years (2013-2020). The NAIP also attempts to align all of the various programs and projects and a sector perspective. Its overall objective is to stimulate sustained annual growth in the agricultural sector greater than 6%, which is vital for reducing poverty, ensuring the food and nutrition security of the Congolese people, and generating sustainable employment and income. To deliver on the policy at a decentralized level, the government has also established and mandated structures such as the national Advisory Council, the Provincial Advisory Councils and the Agricultural Administration Councils (CARG). The CARG is currently the only system that unites institutions, local political representatives, producers, manufacturers, and civil society.8 However in order for it to function fully it needs further support and its decision-making powers
7 http://www.abghq.com/downloads/DRC.pdf
8 TANGUY SMOES, Agricultural Development in the Democratic Republic of the Congo (DRC)
South Kivu Food Security Project Assesment Report on Market Systems 48 have to be taken into account by development institutions. According to the executive secretary of the South Kivu CARG, the primary aim of CARGs is to “provide support to one third of state actors and two thirds of non-state actors, mainly farmers' organizations.”
Agriculture financing policy Access to finance is critical for the growth of the agriculture sector, as the shift from subsistence to commercial agricultural production requires capital. In DRC, 64% of the total implementation cost of NAIP’s five components is dedicated to the promotion of agricultural value chains and agribusiness. Through this component, funds will also be allocated to: - Direct support to farmers in the form of seeds, agricultural tools and fertilizers, - Rehabilitation of feeder roads to increase market access for agricultural produce - Creation of wells for drinking water access - Mechanization delivery to smallholder farmers
Land issues Access to land is an often cited ‘root cause’ of conflict in eastern DRC, especially in South Kivu. Researchers and experts have identified a number of critical land-related factors contributing to violence and conflict, including many different types of land governance mechanisms; the existence of overlapping legal frameworks and the weakness of the statutory land law; competition between indigenous and migrant communities; limited access to arable land in demographically dense areas; the weak performance of the administration and justice system in the reconciliation and arbitration of land disputes; growing stress on local resources caused by massive displacement; the expansion of artisanal and small-scale mining; and increased competition between elites for the control over land and consequent land concentration.9 Most studies define ‘the land problem’ as a result of contradictions in the existing legal framework and the lack of a transparent land governance framework. As in many other contexts, access to and use of land are governed in the DRC through a multitude of systems, practices and institutional structures, including a statutory land system, customary systems and a variety of informal land governance practices. These systems lack harmonization, have different legal statuses and are based on different rules, rights and obligations. The effects of these contradictions are further worsened by the lack of a true land policy. Land tenure policies are based on often-conflicting documents and statements, which explains why there are no clear standards for the registration of land. This, in turn, leads to confusion, tension, competing claims of ownership or user rights, and, ultimately, various forms and degrees of violent conflict. Statistics from the Provincial Inspection of Agriculture, Livestock and Fisheries (IPAPE) show that 86 percent of smallholder farmers in South Kivu cultivate less than 0.45 hectares, with the average size of domestic farm in South Kivu between 0.3 to 0.4 hectares. Limited land availability, coupled with insecurity that reduced access to land, limits farm scalability and commercialization of produce.
9 Koen Vlassenroot, “Land Issues and Conflict in Eastern DRC”, January 2013.
South Kivu Food Security Project Assesment Report on Market Systems 49 Standards Different trade standards are known in DRC – such as those established by the Common Market for Eastern and Southern Africa (COMESA), the South African Development Community (SADC), the International Organization for Standardization (ISO) and African Regional Organization for Standardization (ARSO) – though the DRC is lagging behind other countries in applying these standards. The DRC’s standards for conformity have been undermined by a lack of updated laws, resources to enforce standards, and trained personnel. While the Ministry of Commerce is responsible for standards and conformity assessments, the Office Congolais de Controle (OCC), an ISO member agency, is responsible for developing standards and performing conformity assessments on exports and imports, and is responsible for developing and enforcing national standards in consultation with research institutions and other industry groups, but it lacks an annual standards plan.10 This study found that most agriculture commodities traded in Kabare and Kalehe markets do not meet required standards for human consumption and that there is not consistent enforcement of existing standards.
Coordination At a conceptual level, a market system is a type of coordination mechanism. The main elements of coordination within market systems are those that coordinate people, activities, and the flow of goods, services and information. Coordination mechanisms are institutional (businesses, membership-based organisations, nonprofits, federations, associations, cooperatives), socio- cultural, physical, and non-physical (i.e. online) and operate at different levels in the system. - National Level – The "Fédération des Entreprises du Congo" (FEC) provides support to large industry and industrial employers and functions as both as a chamber of commerce as well as an employers' association. For the Kivus, FEC plans on promoting the Kivus as a potential sourcing destination for agro-industry, marketing the region’s availability of fertile land, the large supplier base (of farmers), the existing capacity around good quality meat and horticulture and the potential returns-on-investment of improved farming practices and soil-sensitive conservation agriculture practices. FEC also promotes coordination with other regions in the country: it has claimed that Kinshasa imports more agriculture produce from South Africa than it does from the Kivus. - Provincial level – FEC has branches at the provincial level including Bukavu. These branches help local traders organize and become a formal member of the FEC. The traders that form part of FEC also have access to internal funds (tontines) that are occasionally spent on building the capacity of smallholder farmers. In addition to FEC, there is another institution called Conseil Agricole Rural de Gestion (CARG), which is a consultative platform of agriculture market actors in South Kivu. CARGs have representatives in all markets through market management
10https://www.export.gov/article?id=Congo-Democratic-Republic-Standards-for-Trade
South Kivu Food Security Project Assesment Report on Market Systems 50 committees, who play the role of providing market information prices to the general population visiting these markets. They are also supposed to help market actors use standardized units of measure when buying or selling agricultural commodities. Finally, they also participate in solving conflict issues within these markets. - Territory level – In all markets visited, these committees exist and are operational. However, we observed that price information is not publicly available on the boards and the use of appropriate measurement instruments such as weighing scales is not enforced. The majority of market players use estimation or inappropriate units of measurement. For example in Mudaka market, there is a market management committee (Comite de Marche), which regulates day-to- day activities of the market. In addition to this committee, there are approximately 60 sub- committees are actively involved in each commodity including agriculture commodities. These committees in Mudaka market intervene on how prices are fixed at the local market, provide advocacy and lobbying services in terms of taxation and solve conflicts when they arise.
Taxation In South Kivu, the vast majority of smallholder farmers and other market chain actors report that they pay taxes when conducting agri-business transactions. Even if the concept of “tax” is universally official and lawful, many actors in South Kivu perceive it to be either legal or illegal. According to the market actors that we interviewed, some of the taxes are legal and others are illegal, and this lack of differentiation undermines the value of taxation to fund various public investments. Farmers report cases of punishment for non-payment, such as produce confiscation. Moreover, in some areas, there is no receipting system for taxes, nor are they fixed prices or agreed tariffs and levies. The majority of market actors in Kabare and Kalehe complain about high taxation environment in which they are condemned to operate. For example, in Kabamba market, we observed the following types of taxes: 1) daily tax of $0.13; 2) agronomic tax which is annual about $3; 3) patente which is also annual of $5-10 depending on the nature of your business; 4) market stall tax of $5 per annum. For those operating milling machines, the following taxes are applicable in addition to the above-mentioned taxes: 1) General Directorate of Taxation (DGI) of $31.25 per annum; 2) Environmental tax of $18.75 ;3) Industrial tax of $11, and Collectivity tax of $10.
4.1.3.1. Supporting Functions
Infrastructure For a market system to be dynamic and efficient, a level of basic infrastructure is required. This infrastructure includes market buildings, storage facilities and post-harvest and processing facilities. Roads and transportation facilities are necessary to provide to market actors physical access to markets, while buildings provide physical location and shelter from which goods and services are made available. Some Kabare and Kalehe markets do not have buildings while others have buildings that aren’t sufficient for market activities. Where buildings aren’t sufficient, the majority of transactions are done in open air. In this case, on a given rainy day, market actors are forced to run away and look for shelter and wait for the rain to stop in order to resume their activities.
South Kivu Food Security Project Assesment Report on Market Systems 51 Nonexistent or heavily deteriorated roads especially in the Haut Plateau areas limit the extent to which commodities are able to circulate from surplus to deficit areas of the region. There are practically no paved roads in South Kivu, with mudslides occurring regularly resulting in blocking all traffic and shipment. Furthermore, the danger from armed militia groups limits accessibility in some areas and causes great risk and cost to transporters of goods. While there is lake transportation available in some areas of Kabare and Kalehe, which is an alternative to land transportation, the majority of market actors use roads, but the poor condition of the Bukavu- Goma road and other adjacent feeder roads makes moving commodities within and between regions time consuming and expensive. The scarcity of storage facilities is also a common challenge for market actors in Kabare and Kalehe, where only three storage facilities are identified in Birava, Kalehe and Minova. The remaining markets don’t have appropriate storage facilities. This has a direct effect on both sellers and buyers who have no choice than to sell at lower prices in order to get rid of their produce for lack of storage and for the buyers to buy large quantities that they may not be able to sell in end- markets. For perishable commodities, there is no cooling infrastructure available, which may lead to higher losses. The study found out that due to lack of building infrastructure in most markets, market actors are forced to put their produce on the ground as they sell or buy. This has a repercussion on the quality of the produce to be sold. The physical space allocated for market place or the building area for the same is either insufficient or non-existent in such places as Nyamukubi, Kabamba, Nyabibwe and Katana just to name a few. The results of the 2008 CFSVA reported the absence of rural roads to evacuate the surplus production that rots in the villages. Moreover, for all the villages surveyed by the CFSVA study, 40% travel at least 10 hours to reach the district headquarters and for 20% it takes more than 24 hours. In South Kivu, transportation difficulties and road conditions are partly offset by the use of motorcycles and bicycles for the transportation of people and goods.
Access to finance Access to finance is one of the services critical for the growth of the agriculture market systems. The shift from subsistence to commercial agricultural production and resilience requires funds. However, in DRC like in other developing countries, financing for investments in agriculture is scarce, even for large investors. Financial institutions are reluctant to accept the risks prevalent in the agricultural sector, such as droughts, floods, conflicts, pests and diseases, or the transaction costs of covering large geographical distances. Consequently, although government is now making efforts to attract investment for agriculture, the lack of understanding of the financial risks and opportunities in agriculture, deprives the sector of much-needed funds to boost production, processing and marketing. However, such services are extremely limited in South Kivu. In Kabare and Kalehe, the main financial institution is PAIDEC, which is a microfinance institution operating near Ihusi and Kavumu markets that provides credit services. PROCREDIT, based in Bukavu, also has several branches including those in Mudaka and Kavumu markets. As stated earlier in this report, interest rates are high (1.7-3% monthly) depending on the nature of the business.
South Kivu Food Security Project Assesment Report on Market Systems 52 Indeed, access to finance remains challenging to enable easy flow of goods and services in the market place of Kabare and Kalehe. Further, none of the actors we interviewed confirmed that they conduct their transactions in cash – some market actors revert to the informal credit system between families and friends instead of relying on bank or microfinance credit that are limited in number and less accessible. In addition to these constraints, mobile payment systems are almost non-existent in rural areas of Kabare and Kalehe, which is a missed opportunity that mobile payments provide a secure method that is easy to use for small and medium sized businesses.
Transport services As stated earlier in this report, transporters lack organization. As such, transport fees and costs are determined ad-hoc instead of being fixed and determined based on the distance and the weight being transported. The absence of a road transport regulator poses a challenge on how to improve transport services. The deteriorating state of roads in Kabare and Kalehe has a direct effect on transport costs, availability of appropriate vehicles, limited fuel stations for refueling or maintenance and thus market actors revert to impromptu mode of transport such head carrying affecting the competitiveness of the market system.
Other services Though electricity is required for cooling and storing perishable goods, transformation and value addition activities, coverage is spotty in urban areas and limited in rural areas, even if there are a few instances where solar panels are being installed. Because of the scarcity of electricity in most rural areas, the processed goods are not competitive in price due to higher cost of energy derived from generators. For example, millers of cassava, maize and other cereals experience a higher cost of production compared to their counterparts connected to the electrical grid. A miller in Birava indicated that he charges $0.63 per 80 kg for milling services when using SNEL electricity compared to$0.94 for the same quantity using a generator. Even though the price differential is considerable, the majority of millers are still using generators because of limited availability and shortage of electricity. Water and sanitation services are provided by REGIDESO, but clean water is scarce in many parts of Kabare and Kalehe. Market places that were surveyed lack basic clean water and sanitation, which may affect market actors – notably since when cholera outbreaks occur most market places close and business is put on hold. Therefore, investing in improving water and sanitation services is critical to the welfare of all market actors as well the general population. Communication and information systems are also necessary for the market actors to get useful information about prices, commodity availability, transport cost, and other relevant information needed for the efficiency of their business. Telecom companies such as Vodacom, Airtel, Tigo and others have invested to provide the necessary infrastructure to enable market actors communicate efficiently. Mobile phones are the main tools used to communicate via calls, SMS, and social media. The study has observed that in Kabare and Kalehe, mobile phones are largely used for communication, although connectivity is limited in rural areas. Computers can be also used to provide web-based information but internet connectivity is limited. Radio and television can be
South Kivu Food Security Project Assesment Report on Market Systems 53 used to provide information to market actors. There are also market bulletin boards displayed in some markets used for price information, though during our field visit in different market places, we observed that market bulletin boards are not updated with accurate information. These boards were installed by NGOs but are not used for their intended purpose.
Research and development Research and development in the agriculture sector is the primary responsibility of INERA with support from other international research like IITA, Harvest Plus, universities and NGOs. Though there are considerable efforts towards research for development of new varieties, there are still a lot of challenges. Developing, testing, adopting and disseminating new varieties that meet market requirements need substantial funding that INERA doesn’t have. For example, during one of our site visits, INERA staff confirmed that the institution has not yet been able to develop onion varieties that the markets require. With regards to product development, we have observed that there is a limitation in product diversification. Product developers, if at all available, are not linked to processors and other actors or vice-versa. Processors may not afford to pay for such service if available.
Skills and Capacity In Kabare and Kalehe, most market actors have the basic skills and capacity necessary to conduct their day-to-day business. However, there is a need to improve existing skills in order for the market system to become more competitive and resilient to shocks and stresses. Notably, improving post-harvest and handling techniques, new product development, maintenance of product quality, contract farming and negotiation, use of ICT technologies such market price dissemination via mobile, mobile payment systems and others are some of the new skills that can be developed. Farmer-based extension services to increase productivity - such as improved seed dissemination, small-scale irrigation and mechanization - are some of the examples that can be easily adopted and scaled up. The study observed that many market actors interact with each other without any form of legal binding agreements. The notion of contract is almost non-existent. Payment is almost exclusively done in cash. Social Practices
- Gender divisions In general, gender divisions are a social practice that is very frequent within staple food marketing systems across South Kivu. Women are the key actors in the agriculture market system and they are heavily involved in collecting and assembling commodities for retail, including at weekly markets. Across Kabare and Kalehe territories, women can be seen carrying extremely heavy loads of agricultural produce (including dried cassava, beans, maize, among others) strapped to their heads across the hilly terrain. On the other hand, intermediate wholesaling and processing is mainly carried out by men. Men are also most involved in potentially more lucrative trading activities, like wood, livestock (including butchers), and imported manufactured goods and
South Kivu Food Security Project Assesment Report on Market Systems 54 clothing. Women are generally engaged in smaller-scale and shorter distance trade, while men dominate trade of goods in bulk and over particularly large distances. Due to the structure of these market systems, this division also implies that women are mostly involved in smaller-scale, informal cross-border trade, while men are involved in formal trade flows involving broader regional or international markets in border areas. However, women in Kalehe and Kabare have a less visible and often overlooked role in decision making about the management of household budgets in general and in the allocation of household spending to agriculture inputs.
- Youth Youth play less visible role in market systems of agricultural commodities in South Kivu. Few young people engage in farm activities because they consider agriculture as a non-remunerating job. However, youth are sometimes engaged in the transport of food to markets. They also play a role helping out their mothers with household budget and tutoring parents, other youth (and younger siblings) on financial literacy and sharing the information being learned in school. In most cases, the inclusion of youth in agriculture is welcomed by farmers, especially for the sharing of financial literacy being taught in schools.
- Social Groups VSLA groups are one of the solutions that are used in many countries to strengthen the financial resilience of citizens. However, the vast majority or almost all smallholder farmers in South Kivu are not member of such groups. This is due to the fact that farmers perceive the idea of a group being one that is formal, with clear structures, rules and regulations. Most of farmers do not belong to formal agriculture groups while several of them belong to informal groups. Some are in groups that resolve problems between agriculture and livestock and others belong to self-help groups. Price Seasonality As far as price analysis and seasonality is considered, food prices in the South Kivu markets are either stable or increasing. There does not seem to be a clear pattern of price levels in different markets. The market dispersion measured using the coefficients of variation shows that the products for which prices vary most between South Kivu markets are local rice and cassava flour.
South Kivu Food Security Project Assesment Report on Market Systems 55
4.2 Findings on Market System Selection 4.2.1. Market systems for targeted commodities As mentioned above, the targeted commodities for FSP are beans, cassava, maize and onions in the three health zones of Kabare and Kalehe territories. In this section, our analysis focuses on a market selection matrix with particular attention to the commodities mentioned above. The analysis also highlights supply-and-demand trends, a market system map, actors and their characteristics, the business enabling environment, a SWOT analysis for the market and recommendation for intervention. A market system selection matrix was developed with 5 categories of selection criteria which are: (1) relevance for income, (2) relevance for mitigation and coping, (3) growth and impact potential, (4) feasibility of market system development approach, and (5) resilience. For each category, selection criteria have been set and a total of 19 selection criteria have been retained. Overall, each targeted value chain was weighed based on the above methodology whereby cassava emerged with a total of 42 points ranked first, followed by onion with 41 points, beans with 38 points and maize with 33 points. With regards to the first category, the study explored the extent to which overall livelihoods of households are impacted by a certain value chain. Beyond this impact, the criteria also looked at the involvement of youth and women profit from the value chain; the comparative advantage of developing the value chain vis-à-vis other regions and/or neighboring countries; and employment potential with particular attention to small-scale processing.
Table 8: Relevance to income
Category of Positive / selection Selection criteria Cassava Beans Maize Onions Negative criteria Overall livelihood potential (# of HHs) Positive 3 3 3 2 Livelihood potential for women/youth Positive 2 3 3 3 (control of revenues) Relevance Comparative advantage (other Positive 3 1 1 3 for income regions/neighboring countries) Employment potential (in particular small-scale food processing) (# of Positive 3 1 2 3 HHs) Total weighting 11 8 9 11
Considering relevance for income for households with a total weight of 12 points, cassava and onion emerged with 11 points, followed by maize with 9 points and by beans with 8 points. With regards to overall livelihood potential for households, 3 value chains namely cassava, beans and maize scored equally 3 points because the three value chains are critical in terms of income and food security for households in the targeted FSP zones. Onion scored 2 points because it is not widely consumed by households as a food crop.
South Kivu Food Security Project Assesment Report on Market Systems 56 In terms of livelihood potential for women and youth, onion, beans and maize scored each 3 points because women and youth are mainly involved in revenue control of these crops while cassava scored 2 points due to the fact that this crop is a cash crop and male-dominated. With regards to the comparative advantage to generate income for households vis-à-vis other regions/neighboring countries, cassava and onion scored 3 points, followed by maize and beans scoring each 1 point. Cassava is widely produced and adapted to agro-ecological conditions whereby market actors come from other regions to buy it whereas beans and maize are consumed at households with limited surpluses reaching markets and at times farmers have to rely on imports from other region. Onions don’t grow in every FSP zone but where they are grown, they generate revenues to households. On employment potential with particular attention to small-scale processing for households, cassava and onion scored 3 points followed by maize with 2 points and beans with 1 point. Cassava employs the most people in production, processing and marketing with maize coming next. Onion is grown on very small parcels and can easily generate employment. Beans is not yet fully developed for processing in order to justify considerable numbers of households being employed.
Table 9: Relevance to mitigation and coping
Category Positive of Selection criteria / Cassava Beans Maize Onions selection Negative criteria Relevance Potential to improve soil fertility Positive 1 3 1 1 for Potential to protect (and utilize) Positive 3 3 1 3 mitigation marginal land and coping strategies Potential for intercropping Positive 2 3 2 2 to land Potential to prevent erosion (in Positive 3 3 2 1 degradation particular potential for terracing) Total weighting 9 12 6 7
With relevance to the mitigation and coping category with an overall weight of 12 points, beans maxed with 12 points followed by cassava with 9 points while onion scored 7 points and maize 6 points. Beans have the potential to improve soil fertility more than any crop scoring 3 points because of their ability to fix nitrogen in soils. Cassava, maize and onions each scored 1 point for the same criteria. In comparison to beans, these three crops don’t have the potential to improve soil fertility. With regards to the potential to protect (and utilize) marginal land (including small plots), cassava, beans and onions scored 3 points each because they are capable of being cultivated in marginal soils and are able to cope against climatic stresses while maize scored 1 point because it requires specific soils and inputs. Beans have the potential to intercrop with many other crops than maize and cassava; onions can be associated with cabbage and can play a role for IPM. Beans scored 3 points, followed by cassava, maize and onion scoring 2 points. Beans and cassava have the potential to prevent
South Kivu Food Security Project Assesment Report on Market Systems 57 erosion (in particular potential for terracing) having scored 3 points followed by maize with 2 points and onions with 1 point.
Table 10: Relevance to growth and impact potential
Category of Positive / selection Selection criteria Cassava Beans Maize Onions Negative criteria Strength of demand and growth Positive 3 3 3 3 potential Growth and Supply-side growth / improvement Positive 3 2 3 3 impact potential potential Potential to improve nutrition Positive 1 3 2 1 Total weighting 7 8 8 7
In the growth and impact potential category with an overall weight of 9 points, both beans and maize emerged with 8 points each while cassava and onions scored 7 points each. All targeted crops have a strong demand and growth potential in Kabare and Kalehe. These crops are widely consumed locally and in neighboring markets including Bukavu city and Goma with a possibility of exporting to neighboring countries for crops such as onions. With regards to supply-side/improvement potential, cassava, maize and onions scored 3 points each while beans scored 2 points. The three crops have the potential to be produced on a large scale to supply the markets. For beans, the potential for growth exists, however they are widely consumed at the household level and the varieties being used have lower output with high competition of beans originating from North Kivu. Beans have the potential to improve nutrition having scored 3 points while maize scored 2 points and cassava and onions scoring each 1 point. Beans are nutritious because they contain more proteins and vitamins than maize, cassava and onions.
Table 11: Relevance to feasibility of market system development
Category of Positive / selection Selection criteria Cassava Beans Maize Onions Negative criteria Presence of leading firms or Positive 2 1 3 3 Feasibility of sustainable buyers MSD approach Stability of market (by government or Positive 3 1 1 3 NGO activities) Total weighting 5 2 4 6
On the feasibility of the market system development approach, onion scored 6 points, cassava scored 5 points while maize 4 points and beans with 2 points. With regards to the presence of leading firms in a value chain, maize scored 3 points because it has the potential to attract private sector lead firms especially in the Ruzizi plain. Onion also scored 3 points although there are not lead firms but rather a multitude of small and dynamic firms supplying the Bukavu market. Cassava scored 2 points because it has processing potential with
South Kivu Food Security Project Assesment Report on Market Systems 58 several small-scale processing. Beans scored 1 point because smallholders are involved with limited processing capacity. On the stability of market criteria, cassava and onions scored 3 points because these two crops are market-oriented while beans and maize scored 1 point each because of their household consumption.
Table 12: Relevance to Resilience
Category of Positive / selection Selection criteria Cassava Beans Maize Onions Negative criteria Resilience to climate variability Positive 3 2 1 3 Relevance for Resilience to Resilience to pests Positive 2 2 1 3 other shocks Resilience to conflicts/thefts Positive 2 2 1 1 and stresses Resilience to market fluctuations Positive 3 2 3 3 Total weighting 10 8 6 10
On the resilience category of the selection criteria with an overall weight of 12 points, onion emerged with 10 points since onion has the particularity of offering three cropping season a year. Cassava also marked 10 points, followed by beans with 8 points and maize with 6 points. Cassava and onion are crops that are resilient to climate variability having scored 3 points followed by beans with 2 points and maize with 1 point. With regards to resilience to pests, onions emerged with 3 points because onions are resistant to many pests, followed by cassava and beans with 2 points each and maize with 1 point. Cassava and beans are resilient to conflicts/theft with 2 points each, compared to maize and onions with 1 point each. For example, sour cassava varieties are hard to steal because consuming such variety requires processing. The same applies to beans, which need post-harvest and handling in order to be consumed. Cassava, maize and onion are resilient to market fluctuations followed by beans with 2 points.
Market selection matrix A market selection matrix summarizes the results that are highlighted in the sections above. The matrix evaluates the potentiality of each commodity based on set criteria and weighting. Based on the results found in the matrix, we are able to select 2 to 4 potential value chains for which we shall conduct in-depth market specific reports.
Cassava As mentioned above, cassava comes in the first place with a score of 42 points overall. Cassava is a crop that is cultivated by many households in Kabare and Kalehe, more resilient to different factors as highlighted above and has a higher output that may be improved. This value chain involves many actors such as women in its marketing. Cassava has a longer maturity period and may be harvested for a longer period even during the off season, at the time where granaries are empty. Cassava provides food during a critical period of the year when households are hungry.
South Kivu Food Security Project Assesment Report on Market Systems 59 This crop is the most processed among all targeted FSP crops, has a high demand and can generate incomes and improve household livelihoods. Consequently, cassava has been selected as one of the commodities for which an in-depth market specific report shall be developed.
Beans Beans emerged third with 38 points overall. Like cassava, beans are also widely cultivated by many households and contribute towards soil fertility with intercropping potentiality. They are an important food staple consuming by almost every household in South Kivu, which in itself demonstrate their high demand. Beans are available only for a few months after harvest. There are a lot of beans that are sold immediately after harvest at lower prices therefore creating a shortage in the FSP zone of intervention and then most markets in this area rely on imports mainly from North Kivu. The potential to increase productivity and nutrition is evident and thus beans can increase household incomes. Investing in improved storage facilities and skills will allow to extend overtime the availability of beans in the FSP zone of intervention. Though beans are not yet processed in South Kivu, the possibility of value addition for precooked and cooked beans present an opportunity that needs to be explored and can provide an alternative to preserve deforestation and use of wood and charcoal in their cooking. Therefore, beans have also been selected as one of the commodities for which in-depth market specific report shall be developed.
Maize Maize is also a food staple in South Kivu having scored 33 points overall. In Kabare and Kalehe, maize is cultivated by the majority of households but in mixed crop pattern with low yields. In the FSP targeted areas, maize is mostly consumed fresh (roasted or cooked) with limited processing and value addition. Though maize present potential demand with high output if appropriate improved varieties and other inputs such fertilizers are used, this value chain is not well organized and can hardly compete with maize products such as flour from other regions and neighboring countries. Even if the way this value chain operates is not business or market oriented, maize have also been selected considering its high demand and processing potentiality.
Onions Onions scored 41 points overall. Onions are used as a condiment. Though onions are not grown everywhere in Kabare and Kalehe, where they are grown and are adapted, the yield and demand is high and its expansion can be easily done in the FSP zone of intervention. Many actors are involved in onion production, especially women in production and marketing. Revenues generated from onions are high at the household level. Therefore, onions should be selected and an in-depth market should be developed.
South Kivu Food Security Project Assesment Report on Market Systems 60 Market Matrix The market matrix below provides more details on market system selection criteria. Its rationale provides the basis of which we determined the selection of cassava, beans, maize and onions and its in-depth specific market reports shall be conducted.
Table 13: Market system selection matrix - FSP DRC
MEDIUM LOW = HIGH = 3pts = 2pts 1pt 3 2 1
Potential market systems Category of Positive / selection Selection criteria Cassava Beans Maize Onions Negative criteria Overall livelihood potential (# of HHs) Positive 3 3 3 2 Livelihood potential for women/youth Positive 2 3 3 3 Relevance (control of revenues) Comparative advantage (other for income Positive 3 1 1 3 regions/neighbouring countries) Employment potential (in particular Positive 3 1 2 3 small-scale food processing) Potential to improve soil fertility Positive 1 3 1 1 Potential to protect (and utilise) marginal Positive 3 3 1 3 land Relevance Potential for intercropping Positive 2 3 2 2 for mitigation Potential to prevent erosion (in particular and coping Positive 3 3 2 1 potential for terracing) Potential to improve coping capacity Positive (resource management / social capital) Strength of demand and growth potential Positive 3 3 3 3 Growth and Supply-side growth / improvement impact Positive 3 2 3 3 potential potential Potential to improve nutrition Positive 1 3 2 1 Presence of leading firms/buyers Positive 2 1 3 3 Feasibility of Stability of market (by government or Positive 3 1 1 3 MSD NGO activities) approach Evidence of success of market approach Positive in South Kivu Resilience to climate variability Positive 3 2 1 3 Resilience to pests Positive 2 2 1 3 Resilience Resilience to conflicts/thefts Positive 2 2 1 1 Resilience to market fluctuations Positive 3 2 3 3 TOTAL points 42 38 33 41
RANKING 1 3 4 2
South Kivu Food Security Project Assesment Report on Market Systems 61 4.2.2. Market Specific Reports of Selected Markets 4.2.3.1. Cassava Cassava is one of the major commodities grown in Kabare and Kalehe territories. This commodity is mainly grown by smallholder farmers almost everywhere in these two territories. In many cases, smallholder farmers work individually and are not organized in associations or cooperatives except in some areas, such as Katana where smallholder farmers are organized around a producer association, and Kalehe where some farmers are organized under UCOAKA cooperative union that has 12 member cooperatives. Around Nyamukubi market, farmers are organized into COOPADI, a cooperative that support cassava farmers. FOPAC, which is a farmer federation organization, provides support to cassava farmers in South Kivu. FOPAC channels its support through other organizations such as RAAFP, which is working directly with cassava producers in Kabare. As a major food staple in South Kivu, cassava can be consumed as flour (cassava bread a.k.a Ugali), fresh or dry cooked cossettes, and also as leaves (Sombe). Demand for cassava is made by the local population in Kabare and Kalehe, mainly semi-urban and urban consumers surrounding the major producing areas. There is high demand for cassava in Bukavu city and its surrounding suburbs such as Ngweshe, Kavumu and Mudaka. Our study observed that Katana and Kabamba markets are more active in cassava trading. To illustrate this, there are 70 milling units in Katana alone and these units are close to each other. The same case applies to Kabamba, which has 23 milling machines. In Katana alone, there are 300 cassava collectors who are predominantly women who collect cassava cossettes from farmers and supply them to millers. In return, the same collectors retail cassava flour in the local market. During the abundance period, which goes from July to March, cassava cossettes are collected around Katana and Kabamba markets however during the shortfall period which goes from April to June, collectors and traders travel up to Kalehe, Bunyakiri, Goma and Rwanda to collect cassava cossettes. According the millers’ association (Synergie des Meuniers de Kabare Nord – AMKN Asbl), they can produce around 10 to 15 trucks of 10 tons’ worth of flour weekly, or 100 to 150 tons translated into 500 tons monthly during the abundance period. Main clients buying cassava flour from Katana markets come from Ngweshe, Bukavu and other surrounding markets such as Kavumu, Mudaka, Birava, Mushweshwe. Local consumers in Katana at times can consume a considerable quantity of the produced flour. During the shortfall period, they can produce 2 to 3 trucks of 10 tons each weekly which is 20 to 30 tons weekly and 80 to 100 tons monthly. Price of cassava cossettes in the abundance period is about $0.32 per kilogram while in the shortfall period, same commodity is sold between $0.56 per kilogram. As mentioned above in table 3 for milling machines at the visited markets, for each visited market, we observed a big presence of millers that produce locally cassava flour that they sell locally or in other markets. In all 7 markets that we visited, there were 144 millers.
South Kivu Food Security Project Assesment Report on Market Systems 62 Market System Mapping Cassava Commodity Market System Map
Limited Limited Lack of purchasing Market Environment: presence of organized power for local Institutions, rules, norms and financial High credit transport people/high services interest rate trends demand
Figure 21: Map of Cassava Market System Low Informal High productivity organization Insecurity taxation of traders
Market chain: Market actors and Semi-wholesalers their linkages
Local Collectors Retailers End consumers producers/Farmers Processors
Transporters
Key infrastructure and supporting services
Limited Market and Limited financial services Market accessible with poor Limited access to market Storage Infrastructure and BDS road infrastructure information
South Kivu Food Security Project Assesment Report on Market Systems 63 Cassava market actors’ characteristics Market actors for cassava are made of farmers, farmer’s organizations, collectors, small traders, small and medium wholesalers, millers, transporters, consumers. Table 13: Characteristics of cassava market actors
Market Characteristics actors Farmers They grow cassava almost in every agro-ecological zone. The majority of them are smallholder farmers with an average of 0.3-0.4 ha of land. They are price takers with limited bargaining power and knowledge on price information. Some farmers sell their output to collectors before harvest while others harvest and dry cassava in the field and sell cossettes to traders. There are farmers who sell on the marketplace. Depending on their proximity to the market, some carry their produce using manpower to sell on the local market and while others walk longer distances to reach the market. Many sell individually mostly during the harvest leaving them at the mercy of the buyer. They do not use units of measurement to weigh their produce while selling. No written contract or agreement are used when selling. Limited working capital to buy the necessary is a constraint that farmers face daily. Farmers’ Farmer’s organizations are limited. As mentioned above, smallholder farmers in organizations many cases work individually and are not organized in associations or cooperatives except in some areas such as Katana where smallholder farmers are organized around a producer association and Kalehe where some farmers are organized under UCOAKA cooperative union that has 12 member cooperatives. Around Nyamukubi market, farmers are organized into COOPADI, a cooperative that support cassava farmers. FOPAC which farmer federation organization provides support to cassava farmers in South Kivu. FOPAC channels its support through other organizations such as RAAFP, which is working directly with cassava producers in Kabare. Collectors Collectors in cassava value chain are individual business people mostly women working directly with farmers to collect their produce in their households, farm gate or in small village centers. They sell it to local and urban market traders and processors. Though they play an important role linking farmers to markets and take higher risk to collect the produce, they are many in number therefore leading to diminished returns. In many cases, they don’t offer fair prices to farmers. They work individually and are mostly not organized in any association or have a legal status except in Katana market where they have an association that works directly with millers. The majority of them operate informally. One of the major constraints they raised is access to finance which is limited and this has a negative impact on the volume of their business. Traders The majority of traders in cassava value chain are small, they operate in small shops around the markets (rural and urban) and their volume are relative small but the main product they sell is flour. They sell to retailers in the market, to other traders, consumers, millers. A few sell to restaurants, small lodges, and schools. Some use units of measurement known as namaha bowls, bucket, basins, and manual weighing scales. Access to finance is limited and they use their own savings
South Kivu Food Security Project Assesment Report on Market Systems 64 to buy and sell products. Payment is made in cash which is risky. They use mobile phones to acquire market information such price, availability, volume, location of products. Semi- They sell relatively bigger quantities. They work with transporters to move these wholesaler quantities from market to market or vice versa. They sell to other small traders, retailers, millers, consumers and even other market participants from far away. The majority of semi-wholesalers are in many case millers. Their stock on average is between 1 to 20 tons. They don’t have appropriate storage facilities. They don’t have the required handling and storage skills to preserve their stock and avoid losses in quality. Like collectors and traders, access to finance for semi-wholesalers is limited and they use their own savings to buy and sell products. Payment is made in cash which is risky. This in itself limit their transactional capacity. They use mobile phones to acquire market information such price, availability, volume, location of products. Processors Cassava processors in Kabare and Kalehe are mostly millers who buy cassava cossettes to process it into flour. They operate small processing machines, which are electrical or powered by engines. Due to electricity cut-off, these millers don’t operate optimally. In the shortfall period, they experience low volumes and their sales are affected. Raw materials that they use are not of good quality, the flour they produce is therefore of low quality. They operate in unhygienic conditions and don’t conform to any known standard for food processing. They operate steel machines when the norm is to use stainless steel to avoid any food contamination. The use of these small processing machines affect their output. They don’t have any appropriate storage facility for raw material and finished products. They sell to traders, semi-wholesalers, retailers and consumers. Access to finance is limited and they use their own savings to buy and sell products. Payment is made in cash, which is risky. They use mobile phones to acquire market information such price, availability, volume, location of products. Transporters Transport of cassava products such as cossettes and flour is done by manpower, bicycles, motorcycles and small trucks. In some markets like Kavumu, Katana, Kabamba and Ihusi, there are some small trucks which help to move products from the above mentioned markets to other markets such as Bukavu. There are trucks coming from Bukavu and Ngweshe, which come to pick products including cassava flour and cossettes to be transported and sold in trading centers and urban areas. Other transport means locally are minivans and motorcycles. Motorized boats and canoes bring commodities from other market around the lake like Birava, Nyamukubi and Bukavu. Commodities are moved from the production areas using manpower and motorcycles whereas trucks are used to move products from market to market. Transport charges are negotiated ad-hoc and there are no predetermined charges based on distance and volume. Many roads in Kabare and Kalehe are in poor conditions and haven’t been maintained properly which makes difficult commodity transportation. Transporters in general complained about red tape and excessive taxation. These two elements contribute to higher transport costs. Retailers These are small traders who buy and sell smaller quantities of cassava cossettes, flour and leaves (Sombe). They sell them using small units of measurement mostly estimated to local consumers. They operate with limited working capital and are
South Kivu Food Security Project Assesment Report on Market Systems 65 mainly women. Consumers Consumers are households of Kabare and Kalehe. Restaurants, bars, small lodges, schools and other institutions are also consumers. The majority of cassava consumers are located in Bukavu and Goma cities and surrounding trading centers and markets like Ngweshe.
Cassava Market Enabling Environment The enabling environment for cassava market includes infrastructure, rules and regulations, policies, market management and supporting services. Table 14: Characteristics of cassava market environment
Enabling Characteristics environment factors
Infrastructure The cassava market infrastructure should be made of drying and storage facility, processing units, water and electricity, shelter, stalls for physical marketplace, roads (national and feeder roads), and telecommunication. In Kabare and Kalehe, some physical marketplaces have shelters, stalls, some small storage facilities, some processing units, electricity and water. The surface area of most physical marketplace is small compared to the number of market participants that frequent it and a good number of cassava market actors conduct their transactions outside the surface area. The market surface area is not paved, the available shelter stalls are not enough leaving many market participants to sell or buy their product on the ground. Electricity is available in many markets with inappropriate electrical installation and frequent power cuts. Water and sanitation facilities are not sufficient to cover the needs of all market participants including cassava market actors. Storage facilities have limited capacity and they are not suitable. Mobile, radio and television are available in some area but internet is limited. Rules, regulations Cassava trading in Kabare and Kalehe is conducted in general informally. and standards However, in many physical markets, cassava market management is regulated by a market committee and specific commodity sub-committees elected by all market actors. The members of these committees are volunteers. Traders determine selling and buying prices for cassava products but the farmer’s role and government’s involvement are almost nonexistent. Cassava products traded are not standardized and there is no formal regulation mechanism. Due to the nature of informal trading, weighing is done using estimates and many times inappropriate weighing measurements such as namaha bowls, bags, non-calibrated scales. Many cassava market actors complain about high taxation and some consider tax being charged as informal or formal.
South Kivu Food Security Project Assesment Report on Market Systems 66 Supporting services There is a limited presence of financial service providers in Kabare and Kalehe. In the two territories, PAIDEC and PROCREDIT are the only financial institutions providing some financial services like credit and deposit services. PROCREDIT use an agent banking model to service its clients in Mudaka market. PAIDEC has two branches in Kavumu and Ihusi. Payment using bank services or mobile payment is almost non-existent. According to CARG provincial, market information and price dissemination is a function of the market committee, which is supposed to provide it to all market actors on a regular basis. Unfortunately, this is not done in many marketplaces. Finally, business development services are not available.
Cassava Market SWOT Analysis The cassava market SWOT analysis was conducted to determine its strength, weakness, opportunity and threats. The table below illustrates our findings Table 15: SWOT Analysis for cassava market
STRENGHTS WEAKNESSES . Cassava is a major food staple consumed . Lack of drying and storage facilities for by many households in South Kivu cassava . Majority of households in Kabare and . Use of sub-standard processing equipment Kalehe produce cassava for cassava . Cassava markets are located near . Poor quality of products traded production area of FSP targeted population . Lack of standardized measurement . Cassava has many diversified by-products instruments such as weigh scales like cossettes, flour, leaves, tubers, animal . Cassava production depending on the feed, starch, fermented bread (chikwange), seasonality which affects price fluctuation etc . Lack of big investors . Availability of processing units especially milling . Lack of organized transport system . Availability of some supporting services . Limited R&D for cassava such as financial service providers, . Low productivity electricity and mobile telecommunication OPPORTUNITIES THREATS . Presence of a network of physical . Lack of enforcement of market laws, rules, marketplaces facilitating cassava products standards and regulations trading . Poor state of available roads . Availability of transport infrastructure such . Insufficient financial services as the Bukavu-Goma national road and the proximity to Kavumu airport and lake Kivu . Insecurity in some parts of South Kivu . Presence of USAID funded projects and . High inflation rate other donor funded project with willingness . Volatile price fluctuation to stimulate investment in cassava . High interest rates charged for those production, processing, marketing and accessing PROCREDIT and PAIDEC loans other infrastructure
South Kivu Food Security Project Assesment Report on Market Systems 67 . Presence of mobile telecommunication . Lack of local authorities’ involvement and networks can contribute to create new commitment in the cassava market system products and services such as mobile . Lack of R&D service providers and product payments diversification . Availability of the national agriculture . Unreliable electricity investment policy prioritizing South Kivu as . an investment destination for agriculture Limited purchasing power of local communities . Fertile soil and diversified agro-ecological . zone allowing to grow various commodities Dependence on imported cassava products during shortfall period . Decentralized government entities . supporting cassava market actors Access to market information is difficult . Access to business service providers is limited . Limited internet services
Key Interventions for Cassava Market System
1. Facilitate farmers to access improved cassava cuttings 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in agricultural good practices for cassava and on production costs and marketing 4. Train farmers on best practices of post-harvest, handling and storage for cassava 5. Facilitate the acquisition of post-harvest and handling equipment and materials for cassava farmers 6. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments 7. Facilitate access to standardized measurement tools and instruments to all cassava market actors 8. Promote the enforcement of the use standardized measurement tools and instruments 9. Mobilize investors (public and private) to invest in cassava value chain production and processing 10. Mobilize and sensitize big land owners to lease their non-exploited land to smallholder cassava farmers under fair agreements or arrangements 11. Provide market information to all cassava market actors though innovative web-based and mobile applications, media and bill boards 12. Facilitate business-to-business market linkages for cassava market actors 13. Introduce and promote contract farming between farmers and other market actors 14. Train cassava farmers on financial literacy 15. Sensitize financial institutions to facilitate all cassava market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 16. Sensitize cassava market actors to use digital finance tools such as mobile money payment 17. Capacity building to reinforce the role of cassava market sub-committees 18. Organize transport system for cassava
South Kivu Food Security Project Assesment Report on Market Systems 68 4.2.3.2. Beans Market System Beans is also a major food staple in South Kivu. It is grown by many households on small land. Many smallholder farmers grow bush beans intercropped with other crops which affect yields. There are little surplus reaching the markets in Kabare and Kalehe and farmers have to rely on imports from North Kivu. Some beans come from the highland area which is outside the FSP zone of intervention. Farmers’ organization as described in the cassava section is the same for beans. During the harvest period, some traders buy beans from farmers around them when prices are low and store them for future sale when prices are up. In the shortfall period, they buy beans from other areas such as Bunyakiri, Haut Plateau, Goma and even Rwanda. In some areas like Ihusi market in Kalehe, prices of beans are the highest compared to other visited markets due to shortage and limited local supply. With regards to demand, beans are consumed by almost all households in Kabare and Kalehe and are one of the major sources of protein. The majority of the consumers are located in urban areas where demand is high and purchase power is above that of the rural areas. Some institutional consumers like schools, universities, military and police barracks, hotels and restaurants, refugees and displaced people constitute a sizeable market share for beans. Beans are consumed in different forms. As fresh, farmers eat bean leaves, green beans and fresh beans. They can also be consumed as dried which constitute the majority of beans consumed. In Kabare and Kalehe, there is no processing unit for beans even in the whole South Kivu province.
South Kivu Food Security Project Assesment Report on Market Systems 69 Market System Mapping Beans Commodity Market System Map
Limited Limited Lack of purchasing Market Environment: presence of organized power for local Institutions, rules, norms and financial High credit transport people/high services interest rate trends demand
Figure 22: Mapping of Beans Market System Low Informal High productivity organization Insecurity taxation of traders
Market chain: Market actors and Semi-wholesalers their linkages
Local Collectors Retailers End consumers producers/Farmers
Transporters
Key infrastructure and supporting services
Limited Market and Limited financial services Market accessible with poor Limited access to market Storage Infrastructure and BDS road infrastructure information
South Kivu Food Security Project Assesment Report on Market Systems 70 Beans market actors’ characteristics Beans market actors are made also of farmers, farmer’s organizations, collectors, small traders, semi-wholesalers, transporters and consumers. Table 16: Characteristics of beans market actors
Market Characteristics actors Farmers Like cassava, farmers grow beans almost in every agro-ecological zone. The majority of them are smallholder farmers with an average of 0.3-0.4 ha of land. They grow mostly bush beans with low yields and the use of improved seed is limited. Farmers recognize that climbing beans have higher yields than bush beans but are challenged to acquire stakes necessary to grow this variety. A sizeable part of their production is consumed at the household level and the surplus is sold at the home gate and local market. Many farmers sell individually and are price takers with limited bargaining power and knowledge on price information. Depending on their proximity to the market, some carry their produce using manpower to sell on the local market and while others walk longer distances to reach the market. They do not use units of measurement to weigh their produce while selling. No written contract or agreement is used when selling. Limited working capital to buy the necessary is a constraint that farmers face daily. Farmers’ In Kabare and Kalehe, farmer’s organizations are limited. Smallholder farmers in organization many cases work individually and are not organized in associations or s cooperatives. However, in some areas such as Kabare, there are farmers’ organizations regrouped in farmers’ associations and cooperatives like BAZIRE RHUHEKEKUGUMA which is a women-owned cooperative with 70 members of which 29 are young mothers with less than 30 years of age. They are involved in beans and Irish potato production. Another example is BAZIRE NYANYA association with 100 members of which 20 are youths. This association is producing and marketing beans. In Kalehe also, some farmers are organized under UCOAKA cooperative union that has 12 member cooperatives. Around Nyamukubi market, farmers are organized into COOOPADI, a cooperative that support beans farmers. FOPAC which farmer federation organization provides support to beans farmers in South Kivu. FOPAC channels its support through other organizations such as RAAFP, which is working directly with beans producers in Kabare. Collectors In the beans value chain, collectors are individual business people mostly women working directly with farmers to collect their produce in their households, farm gate or in small village centers. They sell it to local and urban market traders. Though they play an important role linking farmers to markets and take higher risk to collect the produce, they are many in number therefore leading to diminished returns. In many cases, they don’t offer fair prices to farmers. They work individually and are mostly not organized in any association or have a legal status. The majority of them operate informally. One of the major constraints they raised is access to finance, which is limited, and this has a negative impact on the volume of their business.
South Kivu Food Security Project Assesment Report on Market Systems 71 Traders Most traders in beans value chain are small, they operate in small shops around the markets (rural and urban) and their volume is relative small. The main product they sell is dried beans. They sell to retailers in the market, to other traders, and consumers. Some sell to restaurants, small lodges, and schools. They use units of measurement known as namaha bowls, bucket, basins, and manual weighing scales. Access to finance is limited and they use their own savings to buy and sell products. Payment is made in cash, which is risky. They use mobile phones to acquire market information such price, availability, volume, location of products.
Semi- They sell relatively bigger quantities that were bought during the harvest period and wholesaler stored to be resold during the shortfall period. At times, they buy beans from other areas like Bunyakiri, Haut Plateau, Goma and Rwanda. They work with transporters to move these quantities from market to market or vice versa. They sell to other small traders, retailers, consumers and even other market participants from far away. Their stock on average is between 1 to 20 tons. They don’t have appropriate storage facilities. Some semi-wholesalers need to improve their handling and storage skills to preserve their stock and avoid losses in quality. Access to finance for many of the semi-wholesalers is limited and they use their own savings to buy and sell products. Furthermore, in Nyamukubi market, there is a woman semi- wholesaler who works with PAIDEC-Kalehe. Payment is made in cash, which is risky. This in itself limits their transactional capacity. They use mobile phones to acquire market information such price, availability, volume, location of products. Transporters Beans transport use the same means like for cassava except that the volume of beans is somewhat limited compared to cassava. Transport is done by person- power, bicycles, motorcycles and small trucks. In some markets like Kavumu, Katana, Kabamba and Ihusi, there are some small trucks which help to move products from the above-mentioned markets to other markets such as Bukavu. Other transport means locally are minivans and motorcycles. Motorized boats and canoes bring commodities from other market around the lake like Birava, Nyamukubi and Bukavu. Beans are moved from the production areas using manpower and motorcycles whereas trucks are used to move products from market to market. Transport charges are negotiated ad-hoc and there are no predetermined charges based on distance and volume. Many roads in Kabare and Kalehe are in poor conditions and haven’t been maintained properly which makes difficult commodity transportation. Transporters in general complained about red tape and excessive taxation. These two elements contribute to higher transport costs. Retailers Like for other commodities, beans retailers are small traders who buy and sell smaller quantities of beans. They sell them using small units of measurement mostly estimated to local consumers. They operate with limited working capital and are mainly women. Consumers Consumers are households of Kabare and Kalehe. Restaurants, supermarkets, bars, small lodges, schools and other institutions are also consumers. The majority of beans consumers are located in Bukavu and Goma cities and surrounding trading centers and markets.
South Kivu Food Security Project Assesment Report on Market Systems 72 Beans Market Enabling Environment
The enabling environment for beans market includes infrastructure, rules and regulations, policies, market management and supporting services. This enabling environment is similar to that of cassava.
Table 17: Characteristics of beans market environment
Enabling Characteristics environment Infrastructure The beans market infrastructure should be made of drying and storage facility, processing units, water and electricity, shelter, stalls for physical marketplace, roads (national and feeder roads), and telecommunication. In Kabare and Kalehe, some physical marketplaces have shelters, stalls, some small storage facilities, electricity and water. The surface area of most physical marketplace is small compared to the number of market participants that frequent it and a good number of beans market actors conduct their transactions outside the surface area. The market surface area is not paved, the available shelter stalls are not enough leaving many market participants to sell or buy their product on the ground. Electricity is available in many markets with inappropriate electrical installation and frequent power cuts. Water and sanitation facilities are not sufficient to cover the needs of all market participants including beans market actors. Storage facilities have limited capacity and they are not suitable except for Ihusi and Birava markets where some storage facilities are available but not fully utilized. Mobile, radio and television are available in some area but internet is limited. Rules, regulations Like other commodities, the trading of beans in Kabare and Kalehe is and standards conducted in general informally. However, in many physical markets, beans market management is regulated by a market committee and specific commodity sub-committees elected by all market actors. The members of these committees are volunteers. Traders determine selling and buying prices for beans but the farmer’s role and government’s involvement are almost nonexistent. Beans traded are not standardized and there is no formal regulation mechanism. Due to the nature of informal trading, weighing is done using estimates and many times inappropriate weighing measurements such as namaha bowls, bags, non-calibrated scales. Many beans market actors complain about high taxation and some consider tax being charged as informal or formal. Supporting services Supporting services in Kabare and Kalehe are limited. In the two territories, PAIDEC and PROCREDIT are the only financial institutions providing some financial services like credit and deposit services to beans market actors. As mentioned above, PROCREDIT uses an agent banking model to service its clients in Mudaka market. PAIDEC has two branches in Kavumu and Ihusi. Payment using bank services or mobile payment is almost non-existent. According to CARG provincial, market information and
South Kivu Food Security Project Assesment Report on Market Systems 73 price dissemination is a function of the market committee, which is supposed to provide it to all market actors on a regular basis. Unfortunately, this is not done in many marketplaces. Finally, business development services are not available.
Beans Market SWOT Analysis
Table 18: SWOT Analysis for beans market
STRENGTHS WEAKNESSES . Beans is a major food staple consumed . Insufficient drying and storage facilities for by many households in South Kivu beans . Majority of households in Kabare and . Low quality of beans traded at markets Kalehe produce beans . Lack of standardized measurement instruments . Beans markets are located near such as weigh scales production area of FSP targeted . Beans production is subject on the seasonality population which affects price fluctuation . Beans are nutritious and a major source . Lack of big investors of proteins . Lack of processing facilities for beans . Beans have a longer shelf-life . Lack of organized transport system . Availability of some supporting services such as financial service providers, . Limited R&D for beans electricity and mobile telecommunication . Low productivity OPPORTUNITIES THREATS . Presence of a network of physical . Lack of enforcement of market laws, rules, marketplaces facilitating beans trading standards and regulations . Availability of transport infrastructure . Poor state of available infrastructure (national such as the Bukavu-Goma national road and feeder roads) and the proximity to Kavumu airport and . Insufficient financial services lake Kivu . Insecurity in some parts of South Kivu . Presence of USAID funded projects and other donor funded project with . High inflation rate willingness to stimulate investment in . Volatile price fluctuation beans production, processing, marketing and other infrastructure . High interest rates charged for those accessing PROCREDIT loans . Presence of mobile telecommunication networks can contribute to create new . Lack of local authorities’ involvement and products and services such as mobile commitment in the bean market system payments . Lack of R&D service providers and product . Availability of the national agriculture diversification investment policy prioritizing South Kivu . Unreliable electricity as an investment destination for agriculture . Limited purchasing power of local communities . Fertile soil and diversified agro- . Dependence on imported beans during shortfall ecological zone allowing to grow various period commodities
South Kivu Food Security Project Assesment Report on Market Systems 74 . Decentralized government entities . Access to market information is difficult supporting beans market actors . Access to business service providers is limited . Limited internet services
Key Interventions for Beans Market System
1. Facilitate farmers to access improved beans seed for including climbing and bio-fortified varieties 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in agricultural good practices for beans and on production costs and marketing 4. Facilitate farmers to acquire stakes (including reeds, use of agro-forestry trees, etc.) for climbing beans 5. Train farmers on best practices of post-harvest, handling and storage for beans 6. Facilitate the acquisition of post-harvest and handling equipment and materials for beans farmers 7. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments 8. Facilitate access to standardized measurement tools and instruments to all beans market actors 9. Promote the enforcement of the use standardized measurement tools and instruments 10. Mobilize investors (public and private) to invest in beans value chain production, post- harvest (drying and storage) and processing 11. Mobilize and sensitize big land owners to lease their non-exploited land to smallholder beans farmers under fair agreements or arrangements 12. Provide market information to all beans market actors though innovative web-based and mobile applications, media and bill boards 13. Facilitate business-to-business market linkages for beans market actors 14. Introduce and promote contract farming between farmers and other market actors 15. Sensitize and train farmers on financial literacy best practices and warrantage and warehouse receipt systems 16. Sensitize financial institutions to facilitate all beans market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 17. Sensitize beans market actors to use digital finance tools such as mobile money payment 18. Capacity building to reinforce the role of beans market sub-committees 19. Organize transport system for beans
South Kivu Food Security Project Assesment Report on Market Systems 75 4.2.3.3. Maize market system Maize is among food staples widely consumed in South Kivu. Like beans, it is grown by many households on small land. Many smallholder farmers grow maize using local varieties with limited performance and intercropped with other crops which affect yields. In Kabare and Kalehe, maize is mainly consumed fresh roasted or cooked and there are little surpluses reaching the markets and farmers have to rely on imports from neighboring countries like Rwanda and Uganda. Farmers’ organization as described in the beans section is the same for maize. During the harvest period, some traders buy fresh maize from farmers around them when prices are low and sale them in small trading centers and cities like Bukavu. Few farmers are able to dry and store small quantities that can be processed or sold when prices are high. In the shortfall period, traders and farmers buy maize from other areas such as Goma and even Rwanda and Uganda. Concerning demand, maize is consumed by almost all households in Kabare and Kalehe as fresh (roasted or cooked), cooked kernel, maize meal, porridge and local brew. The majority of the consumers are located in urban areas where demand is high and purchase power is above that of the rural areas. Some institutional consumers like schools, universities, military and police barracks, hotels and restaurants, refugees and displaced people constitute a sizeable market share for maize. In Kabare and Kalehe, there are few processing unit for maize as the majority of processing units are designed for cassava, though they are sometimes also used for maize.
South Kivu Food Security Project Assesment Report on Market Systems 76 Market System Mapping Maize Commodity Market System Map
Limited Limited Lack of purchasing Market Environment: presence of organized power for local Institutions, rules, norms and financial High credit transport people/high services interest rate trends demand
Figure 23: Mapping of maize market system Low Informal High productivity organization Insecurity taxation of traders
Market chain: Market actors and Semi-wholesalers their linkages
Local Collectors Retailers End consumers producers/Farmers Processors
Transporters
Key infrastructure and supporting services
Limited Market and Limited financial services Market accessible with poor Limited access to market Storage Infrastructure and BDS road infrastructure information
South Kivu Food Security Project Assesment Report on Market Systems 77 Maize market actors’ characteristics Like other commodities maize market actors are made of farmers, farmer’s organizations, collectors, small traders, semi-wholesalers, processors, transporters and consumers. Table 19: Characteristics of maize market actors
Market Characteristics actors Farmers Maize is grown by farmers in different agro-ecological zone particularly in lower and medium altitudes. The majority of them are smallholder farmers with an average of 0.3-0.4 ha of land as is the case for beans. They grow mostly local varieties with low yields and the use of improved seed and fertilizers is limited. Farmers and other actors involved in maize production have a negative bias towards the use of hybrid seeds and fertilizers. A considerable portion of their production is consumed at the household level and the surplus is sold mainly fresh at the home gate and local market. Many farmers sell individually and are price takers with limited bargaining power and knowledge on price information. Depending on their proximity to the market, some carry their produce using manpower to sell on the local market and while others walk longer distances to reach the market. They do not use units of measurement to weigh their produce while selling. No written contract or agreement is used when selling. Limited working capital to buy the necessary inputs is a constraint that farmers face daily. Farmers’ In Kabare and Kalehe, farmers that produce maize are the same like those who organization produce beans. Likewise, farmer’s organizations are limited. Smallholder farmers in s many cases work individually and are not organized in associations or cooperatives. However, as is the case for beans, in some areas such as Kabare, there are farmers’ organizations regrouped in farmers’ associations and cooperatives like BAZIRE RHUHEKEKUGUMA which is a women-owned cooperative with 70 members of which 29 are young mothers with less than 30 years of age. They are involved in maize and beans production. Another example is BAZIRE NYANYA association with 100 members of which 20 are youths. This association is producing and marketing maize and beans. In Kalehe also, some farmers are organized under UCOAKA cooperative union that has 12 member cooperatives and are involved in maize production. Around Nyamukubi market, farmers are organized into COOPADI, a cooperative that support maize and beans farmers. FOPAC which farmer federation organization provides support to maize and beans farmers in South Kivu. FOPAC channels its support through other organizations such as RAAFP, which is working directly with maize and beans producers in Kabare. Collectors Because maize is mainly sold fresh, collectors are not many and those who are involved are individual business people mostly women working directly with farmers to collect fresh maize cobs in their households, farm gate or in small village centers. A few of them collect dry maize. They sell it to local and urban market traders and processors. Though they play an important role linking farmers to markets and take higher risk to collect the produce, they are many in number therefore leading to diminished returns. In many cases, they don’t offer fair prices to farmers. They work
South Kivu Food Security Project Assesment Report on Market Systems 78 individually and are mostly not organized in any association or have a legal status. The majority of them operate informally. One of the major constraints they raised is access to finance which is limited and this has a negative impact on the volume of their business. Traders The majority of maize traders sell maize in combination with other commodities like beans, soy beans and sorghum. They operate in small shops around the markets (rural and urban) and their volume is relative small. The main product they sell is dried beans. They sell to retailers in the market, to other traders, processors and consumers. They use units of measurement known as namaha bowls, bucket, basins, and manual weighing scales. Access to finance is limited and they use their own savings to buy and sell products. Payment is made in cash, which is risky. They use mobile phones to acquire market information such price, availability, volume, location of products. Semi- Maize semi-wholesalers conduct their business in combination with other crops wholesaler because maize quantities are relatively small compared to other commodities. They sell these quantities that were bought during the harvest period or imported and stored to be resold during the shortfall period. Imported maize come mainly from Rwanda and Uganda as maize flour sold with other types of flour such as cassava, soy beans and sorghum. They work with transporters to move these quantities from market to market or vice versa. They sell to other small traders, retailers, consumers and even other market participants from far away. Their stock on average is between 1 to 20 tons. They don’t have appropriate storage facilities. As is the case for beans, some maize semi-wholesalers need to improve their handling and storage skills to preserve their stock and avoid losses in quality. Access to finance for many of the semi-wholesalers is limited and they use their own savings to buy and sell products. Furthermore, in Nyamukubi market, there is a woman semi-wholesaler of different commodities including maize who works with PAIDEC- Kalehe. Payment is made in cash, which is risky. This in itself limits their transactional capacity. They use mobile phones to acquire market information such price, availability, volume, location of products. Processors Maize processors in Kabare and Kalehe are mostly millers who buy dry maize grain produced locally or imported to process it into flour. They operate small processing machines, which are electrical or powered by engines. These processing units are not exclusively for maize processing, they are also used to process other commodities like cassava, sorghum and soybeans. Compared to cassava, maize flour produced in the FSP zone is relatively small. Due to electricity cut-off, these millers don’t operate optimally. Raw materials that they use are not of good quality, the flour they produce is therefore of low quality. They operate in unhygienic conditions and don’t conform to any known standard for food processing. They operate steel machines when the norm is to use stainless steel to avoid any food contamination. The use of these small processing machines affect their output. They don’t have any appropriate storage facility for raw material and finished products. They sell to traders, semi-wholesalers, retailers and consumers. Access to finance is limited and they use their own savings to buy and sell products. Payment is made in cash, which is risky. They use mobile phones to acquire market information such price, availability, volume, location of products.
South Kivu Food Security Project Assesment Report on Market Systems 79 Transporters Maize grain and flour transport use the same means like other commodities. Transport is done by manpower, bicycles, motorcycles and small trucks. Due to smaller volumes produced of maize, transport using small trucks is combined with other commodities moving them from market to market. Other transport means locally are minivans and motorcycles. Motorized boats and canoes are also used to bring maize from other market around the lake. Maize is moved from the production areas using manpower and motorcycles to market. Transport charges are negotiated ad-hoc and there are no predetermined charges based on distance and volume. Many roads in Kabare and Kalehe are in poor conditions and haven’t been maintained properly which makes difficult commodity transportation. Transporters in general complained about red tape and excessive taxation. These two elements contribute to higher transport costs. Retailers Like for other commodities, maize retailers are small traders who buy and sell smaller quantities of maize cobs, dry grain and flour. They sell them using small units of measurement mostly estimated to local consumers. They operate with limited working capital and are mainly women. Consumers Consumers of fresh maize, dry grain and flour are households of Kabare and Kalehe. Restaurants, bars, small lodges, schools and other institutions are also consumers. The majority of maize consumers are located in Bukavu and Goma cities and surrounding trading centers and markets.
Maize Market Enabling Environment
The enabling environment for maize market includes infrastructure, rules and regulations, policies, market management and supporting services. This enabling environment is similar to that of cassava and beans.
Table 20: Characteristics of maize market environment
Enabling Characteristics environment Infrastructure The maize market infrastructure should be made of drying and storage facility, processing units, water and electricity, shelter, stalls for physical marketplace, roads (national and feeder roads), and telecommunication. In Kabare and Kalehe, some physical marketplaces have shelters, stalls, some small storage facilities, electricity and water. The surface area of most physical marketplace is small compared to the number of market participants that frequent it and a good number of maize market actors conduct their transactions outside the surface area. The market surface area is not paved, the available shelter stalls are not enough leaving many market participants to sell or buy their product on the ground. Electricity is available in many markets with inappropriate electrical installation and frequent power cuts. Water and sanitation facilities are not sufficient to cover the needs of all market participants including maize market actors. Storage facilities have limited capacity and they are not suitable except for
South Kivu Food Security Project Assesment Report on Market Systems 80 Ihusi and Birava markets where some storage facilities are available but not fully utilized. Mobile, radio and television are available in some area but internet is limited. Rules, regulations Like other commodities, maize trading in Kabare and Kalehe is conducted and standards in general informally. However, in many physical markets, maize market management is regulated by a market committee and specific commodity sub-committees elected by all market actors. The members of these committees are volunteers. Traders determine selling and buying prices for maize being fresh, dry grain and flour but the farmer’s role and government’s involvement are almost nonexistent. Maize traded are not standardized and there is no formal regulation mechanism. Due to the nature of informal trading, weighing is done using estimates and many times inappropriate weighing measurements such as bunches for fresh maize cobs, namaha bowls, for maize grains, bags, non-calibrated scales. Many maize market actors complain about high taxation and some consider tax being charged as informal or formal. Supporting services Supporting services in Kabare and Kalehe are limited. In the two territories, PAIDEC and PROCREDIT are the only financial institutions providing some financial services like credit and deposit services to maize market actors. As mentioned above, PROCREDIT uses an agent banking model to service its clients in Mudaka market. PAIDEC has two branches in Kavumu and Ihusi. Payment using bank services or mobile payment is almost non-existent. According to CARG provincial, market information and price dissemination is a function of the market committee which is supposed to provide it to all market actors on a regular basis. Unfortunately, this is not done in many marketplaces. Finally, business development services are not available.
South Kivu Food Security Project Assesment Report on Market Systems 81 Maize Market SWOT Analysis
Table 21: SWOT Analysis for maize market
STRENGTHS WEAKNESSES . Maize is one of major food staple . Insufficient drying and storage facilities for consumed by many households in maize South Kivu . Low utilization of improved seed and fertilizers . Many households in Kabare and Kalehe . Lower yields produce maize . Low quality of maize traded at markets . Maize markets are located near production area of FSP targeted . Low volume of maize produced and traded population . Lack of standardized measurement instruments . Maize is nutritious such as weigh scales . Maize has a longer shelf-life . Maize production is subject on the seasonality which affects price fluctuation . Availability of some supporting services such as financial service providers, . Lack of big investors electricity and mobile . Inappropriate processing facilities for maize telecommunication . Lack of organized transport system . Limited R&D for maize OPPORTUNITIES THREATS . Presence of a network of physical . Lack of enforcement of market laws, rules, marketplaces facilitating maize trading standards and regulations . Availability of transport infrastructure . Poor state of available infrastructure (national such as the Bukavu-Goma national road and feeder roads) and the proximity to Kavumu airport and . Insufficient financial services lake Kivu . Insecurity in some parts of South Kivu . Presence of USAID funded projects and other donor funded project with . High inflation rate willingness to stimulate investment in . Volatile price fluctuation maize production, processing, marketing and other infrastructure . High interest rates charged for those accessing PROCREDIT and PAIDEC loans . Presence of mobile telecommunication networks can contribute to create new . Lack of local authorities’ involvement and products and services such as mobile commitment in the maize market system payments . Lack of R&D service providers and product . Availability of the national agriculture diversification for maize investment policy prioritizing South Kivu . Unreliable electricity as an investment destination for agriculture . Limited purchasing power of local communities . Fertile soil and diversified agro- . Dependence on imported maize during shortfall ecological zone allowing to grow various period commodities . Access to market information is difficult . Decentralized government entities . Access to business service providers is limited supporting maize market actors . Limited internet services
South Kivu Food Security Project Assesment Report on Market Systems 82
Key Interventions for Maize Market System
1. Facilitate farmers to access improved maize seed including hybrid and bio-fortified varieties 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in agricultural good practices for maize and on production costs and marketing 4. Facilitate farmers to acquire fertilizers 5. Train farmers on best practices of post-harvest, handling and storage for maize 6. Facilitate the acquisition of post-harvest and handling equipment and materials for maize farmers 7. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments
8. Facilitate access to standardized measurement tools and instruments to all maize market actors 9. Promote the enforcement of the use standardized measurement tools and instruments 10. Mobilize investors (public and private) to invest in maize value chain production, post- harvest (drying and storage) and processing 11. Mobilize and sensitize big land owners to lease their non-exploited land to smallholder maize farmers under fair agreements or arrangements 12. Provide market information to all maize market actors though innovative web-based and mobile applications, media and bill boards 13. Facilitate business-to-business market linkages for maize market actors 14. Introduce and promote contract farming between farmers and other market actors
15. Sensitize and train farmers on financial literacy best practices and warrantage and warehouse receipt systems 16. Sensitize financial institutions to facilitate all maize market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 17. Sensitize maize market actors to use digital finance tools such as mobile money payment 18. Capacity building to reinforce the role of maize market sub-committees 19. Organize transport system for maize
4.2.3.4. Onions market system Onion is considered as a cash crop by farmers that grow it. It is mostly grown in the Miti- Murhesa and Katana health zones. In these two zones, there are production areas suitable for onions. For example, in Katana health zone the following production area have a higher production of onions: Kahungu, Maziba, Bulolo, Buhimbaduba, Kabushwa, Kamwesihe, Cashogo and Mutunda. Onions farmers work individually and aren’t organized. During our field visit, farmers expressed the need to be organized. There were almost no supporting organizations providing training and other extension services to these farmers. Access to seed is a challenge they face on a regular basis. The production calendar varies from zone to zone. In the Katana health zone, harvest is
South Kivu Food Security Project Assesment Report on Market Systems 83 abundant from November to June while in the Miti-Murhesa health zone, it spans from November to December and March to April. Although onions are not spread in other zones, farmers we visited expressed the desire to grow them and some have started to grow onions on a small scale. AGRIFORCE in collaboration with One Acre Fund have started to support onions farmers around Miti- Murhesa health zone. In Mudaka, there is a youth association, AJP (Association des Jeunes pour la Paix), which is involved in onion production. Demand for onions is high particularly in trading centers and urban markets. Bukavu and Goma cities are the main consuming areas for onions. To reach markets, a large portion of onions is bought from fields by collectors. Most onions traded are fresh and some are harvest prematurely.
South Kivu Food Security Project Assesment Report on Market Systems 84 Market System Mapping Onion Commodity Market System Map
Limited Limited Lack of purchasing presence of Market Environment: organized power for local financial Institutions, rules, norms and High credit transport people/high services interest rate trends demand
Figure 24: Map of Onion Market System Low Informal High productivity organization Insecurity taxation of traders
Market chain: Market actors and Semi-wholesalers their linkages
Local Collectors Retailers End consumers producers/Farmers
Transporters
Key infrastructure and supporting services
Limited Market and Limited financial services Market accessible with poor Limited access to market Storage Infrastructure and BDS road infrastructure information
South Kivu Food Security Project Assesment Report on Market Systems 85 Onions market actors’ characteristics Like other targeted FSP commodities, onions market actors are made also of farmers, farmer’s organizations, collectors, small traders, semi-wholesalers, transporters and consumers. Table 22: Characteristics of onions market actors
Market Characteristics actors
Farmers Onions are mostly grown in specific agro-ecological zones of Miti-Murhesa and Katana. The majority of smallholder farmers grow red onions and the use of improved seed is limited. A small quantity of their production is consumed at the household level and a sizeable portion is sold at local and urban markets. Many farmers sell individually and are price takers with limited bargaining power and knowledge on price information. Depending on their proximity to the market, some carry their produce using manpower to sell on the local market and while others walk longer distances to reach the market. They do not use units of measurement to weigh their produce while selling. They rather use bunches or even sell produce while in the field. No written contract or agreement is used when selling. Limited working capital to buy the necessary is a constraint that farmers face daily. Farmers’ In Kabare and Kalehe, farmer’s organizations are limited. Smallholder farmers in organizations many cases work individually and are not organized in associations or cooperatives. Like mentioned above, in some areas such as Miti-Murhesa, there is a farmers’ association – AJP (Association des Jeunes et Paix) – involved in onion production. However, there are limited or no organization supporting onion farmers except in the case of AGRIFORCE, which is working jointly with One Acre Fund to promote onion production. Collectors In the onions value chain, collectors are individual business people mostly women working directly with farmers to collect their produce in their households, farm gate or in small village centers. Around Miti-Murhesa and Mudaka market, there are more than 50 collectors of onions and the same applies to Katana market. They sell it to local and urban market traders. Though they play an important role linking farmers to markets and take higher risk to collect the produce, they are many in number therefore leading to diminished returns. In many cases, they don’t offer fair prices to farmers. They work individually and are mostly not organized in any association or have a legal status. The majority of them operate informally. One of the major constraints they raised is access to finance which is limited and this has a negative impact on the volume of their business.
South Kivu Food Security Project Assesment Report on Market Systems 86 Traders/Semi- Most traders in onions are women semi-wholesalers who can buy relatively big wholesalers quantities between 3 and 10 bags of 100 kg each. They operate mainly on market days in many markets where they resell the quantities purchased from collectors and farmers. They sell to retailers in the market, to other traders from other markets. They use bunches and bags as units of measurement. Semi-wholesales work with transporters to move these quantities from market to market or vice versa. They sell to other small traders, retailers, and even other market participants from far away. They don’t have appropriate storage facilities. Some semi-wholesalers need to improve their handling and storage skills to preserve their stock and avoid losses in quality. Access to finance for many of the semi-wholesalers is limited and they use their own savings to buy and sell products. Payment is made in cash, which is risky. This in itself limits their transactional capacity. They use mobile phones to acquire market information such price, availability, volume, location of products. Transporters Onions transport use the same means like for other commodities. Transport is done by person-power, bicycles, motorcycles, small trucks and boats. Manpower is used mostly when moving onions from production areas to nearest markets. Motorcycles, trucks and boats move onions from secondary markets to major markets. Often, onions are transported by trucks from Mudaka and Katana markets which are the major onion trading markets. From there, the majority of onions are shipped to Bukavu and Goma. Transport charges are negotiated ad- hoc and there are no predetermined charges based on distance and volume. Many roads in Kabare and Kalehe are in poor conditions and haven’t been maintained properly which makes difficult commodity transportation. Transporters in general complained about red tape and excessive taxation. These two elements contribute to higher transport costs. Retailers Like for other commodities, onions retailers are small traders who buy and sell smaller quantities. They sell them using bunches and single units to measure or weigh what is sold to consumers. They operate with limited working capital and are mainly women. Consumers Consumers are households of Kabare and Kalehe. Restaurants, bars, small lodges, schools and other institutions are also consumers. The majority of onions consumers are located in Bukavu and Goma cities and surrounding trading centers and markets.
South Kivu Food Security Project Assesment Report on Market Systems 87 Onions Market Enabling Environment
The enabling environment for onions market includes infrastructure, rules and regulations, policies, market management and supporting services. This enabling environment is somehow similar to that of cassava and beans. Table 23: Characteristics of onion market environment Enabling Characteristics environment factors Infrastructure The market infrastructure for onions should be made of drying and storage facility, processing units, water and electricity, shelter, stalls for physical marketplace, roads (national and feeder roads), and telecommunication. In Kabare and Kalehe, some physical marketplaces have shelters, stalls, some small storage facilities, electricity and water. The surface area of physical marketplaces where onions are traded most like Mudaka and Katana is small compared to the number of market participants that frequent it and a good number of onions market actors conduct their transactions outside the surface area. In the above mentioned markets, the surface area is not paved, the available shelter and stalls are not enough leaving many market participants to sell or buy their product on the ground. Electricity is available in many markets with inappropriate electrical installation and frequent power cuts. Water and sanitation facilities are not sufficient to cover the needs of all market participants including onions market actors. There are no storage facilities for onions because they are sold fresh and can’t be stored longer. Mobile, radio and television are available in some area but internet is limited.
Rules, Onions trading in Kabare and Kalehe is conducted in general informally. regulations However, in many physical markets, onions market management is regulated by and standards a market committee and specific commodity sub-committees elected by all market actors. The members of these committees are volunteers. Traders determine selling and buying prices for onions but the farmer’s role and government’s involvement are almost nonexistent. Onions which are traded are not standardized and there is no formal regulation mechanism. Due to the nature of informal trading, weighing is done using estimates and many times inappropriate weighing measurements such as bunches, bags, non-calibrated scales. Many onions market actors complain about high taxation and some consider tax being charged as informal or formal. Supporting Supporting services in Kabare and Kalehe are limited. In the two territories, services PAIDEC and PROCREDIT are the only financial institutions providing some financial services like credit and deposit services to onions market actors. As mentioned above, PROCREDIT uses an agent banking model to service its clients in Mudaka market. PAIDEC has two branches in Kavumu and Ihusi. Payment using bank services or mobile payment is almost non-existent. According to CARG provincial, market information and price dissemination is a function of the market committee, which is supposed to provide it to all market actors on a regular basis. Unfortunately, this is not done in many marketplaces. Finally, business development services are not available.
South Kivu Food Security Project Assesment Report on Market Systems 88 Onions Market SWOT Analysis
Table 24: SWOT Analysis for onion market
STRENGHTS WEAKNESSES . Onion is considered as cash crop by . Insufficient drying and storage facilities for onions many households in Kabare and Kalehe . Low quality of onions traded at markets . Onions contribute to increase incomes . Lack of standardized measurement instruments and improve livelihoods such as weigh scales . Onions markets are located near . Onions’ production is subject to seasonality and production area of FSP targeted price fluctuation population . Onions are produced in limited areas . Onions’ demand is high in urban areas such as Goma and Bukavu . Lack of big investors . Onions are nutritious . Lack of processing facilities for onions . Dried onions have a longer shelf-life . Lack of organized transport system . Availability of some supporting services . Limited R&D for onions such as financial service providers, electricity and mobile telecommunication OPPORTUNITIES THREATS . Presence of a network of physical . Lack of enforcement of market laws, rules, marketplaces facilitating onions trading standards and regulations . Availability of transport infrastructure such . Poor state of available infrastructure (national as the Bukavu-Goma national road and and feeder roads) the proximity to Kavumu airport and lake . Insufficient financial services Kivu . Insecurity in some parts of South Kivu . Presence of USAID funded projects and other donor funded project with . High inflation rate willingness to stimulate investment in . Volatile price fluctuation onions production, processing, marketing . and other infrastructure High interest rates charged for those accessing PROCREDIT and PAIDEC loans . Presence of mobile telecommunication networks can contribute to create new . Lack of local authorities’ involvement and products and services such as mobile commitment in the cassava market system payments . Lack of R&D service providers and product . Availability of the national agriculture diversification investment policy prioritizing South Kivu . Unreliable electricity as an investment destination for . Limited purchasing power of local communities agriculture . Access to market information is difficult . Fertile soil and diversified agro-ecological zone allowing to grow various . Access to business service providers is limited commodities . Limited internet services . Decentralized government entities supporting onion market actors
Key Interventions for Onions Market System
South Kivu Food Security Project Assesment Report on Market Systems 89
1. Facilitate farmers to access improved onion seed including red and white varieties 2. Organize farmers in associations and cooperatives, and train them on organization
management, ownership, business and marketing 3. Train farmers in good agricultural practices for onion and on production costs and marketing 4. Train farmers on best practices of post-harvest, handling and storage for onions 5. Facilitate the acquisition of post-harvest and handling equipment and materials for onions farmers 6. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments 7. Facilitate access to standardized measurement tools and instruments to all onions market actors 8. Promote the enforcement of the use standardized measurement tools and instruments 9. Sensitize farmers to discourage side-selling of onions 10. Mobilize investors (public and private) to invest in onions value chain production, post-
harvest (drying and storage) and processing 11. Mobilize and sensitize big land owners to lease their non-exploited land suitable for onion production to smallholder farmers under fair agreements or arrangements 12. Provide market information to all onion market actors though innovative web-based and mobile applications, media and bill boards 13. Facilitate business-to-business market linkages for onions market actors 14. Introduce and promote contract farming between farmers and other market actors 15. Sensitize and train farmers on financial literacy best practices 16. Sensitize financial institutions to facilitate all onions market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 17. Sensitize onion market actors to use digital finance tools such as mobile money payment 18. Capacity building to reinforce the role of onions market sub-committees and create new ones where they are not available 19. Organize transport system for onion
South Kivu Food Security Project Assesment Report on Market Systems 90 4.2.3 Market Network in South Kivu - Kabare and Kalehe The FSP intervention area has approximately 19 markets distributed in the three health zones of Kalehe, Katana and Miti Murhesa with 6 markets in each health zone as indicated in table 26. Some of these markets are relatively big and dynamic while others are small, depending on the number of people who attend them, available infrastructure and types of transactions. In general, many of these markets take place twice a week and few of them take place daily. These markets are physical places with some basic infrastructure (shelter, stalls, small storage facilities, etc.) where commodities and goods are sold. In Kabare and Kalehe, commodities reach marketplaces through different channels. Farmers can sell their produce at farm level (farm gate sale), at home level or at the neighboring local market. Also, commodities reach market places by collectors or traders who are mainly women. In some cases, commodities can circulate in more than one market in the network before they reach the end consumer. The commodities that are sold on these markets are beans, cassava, maize, soy beans, sorghum, bananas, sweat potatoes, Irish potatoes, taro, vegetables etc. The commodity flow in Kabare and Kalehe has a seasonal pattern whereby during the harvest period the supply is channeled from local production areas towards the big markets of Bukavu and Goma. During the shortfall period, the flow is reversed and the supply is done from outside the production area mainly from Goma, Bukavu and neighboring countries. This assessment observed that in some marketplaces food staples become insufficient or almost unavailable during this period, contributing to food insecurity (malnutrition and stunting). The physical and geographic characteristics of these two territories are a key determinant on how market systems function. These areas are made of lower, medium and high plateau. The lower and medium plateaus have access to Lake Kivu and the main road towards Bukavu and Goma. These two plateaus have a relatively low production compared to the higher plateau. However, the higher plateau has a serious infrastructure challenge. Poor or badly maintained roads do not facilitate an easy flow of produce towards markets.
South Kivu Food Security Project Assesment Report on Market Systems 91 Table 25: Market locations in the FSP Health Zone
Markets of FSP Health Zone
S/N Territory Health Health Area Market Coordinates Observation Zone Name
I Nyabibwé Nyabibwé N/A Big market Lushebere Lushebere N/A Big market
Nyamukubi Nyamukubi S01®58’50.2’’ Big market E028°54’40.3’’
Alt:1473m Bushushu Bushushu S02°01’71.1’’ Big market E028°54’16.9’’
KALEHE Alt:1468m Kalehe Ihusi S02°05’27.8’’ Big market E028°54’09.9’’ KALEHE HEALTH ZONE Alt:1619m Luzira Luzira N/A Big market II MUDAKA Mudaka N/A Big market
St Pie X Pungwé N/A Small onion market Murhesa Murhesa N/A Small market Miti Miti N/A Small market Kavumu Kavumu N/A Big market Kahungu Kahungu S02°13’43.8’’ Small market
MITI MURHESA E028°48’11.8’’ Alt:1818m Kabamba Chabwenem S02°10’41.3’’ Big market wami E028°51’27.2’’ Alt:1507m Kabushwa Kabushwa S02°13’29.9’’ Small market E028°49’57.0’’ KABARE Alt:1588m
Ihimbi Ihimbi S02°10’41.3’’ Small market E028°51’27.2’’ Alt:1507m KATANA Mugeri Katana S02°13’29.9’’ Big market E028°49’57.0’’ Alt:1588m Luhihi Luhihi N/A Small market Mushweshwe Mushweshw N/A Big market Birava Birava N/A Big market
During this study, the eight markets that were visited were selected based on their location, accessibility, size, market frequency, traded commodities and infrastructure. Selected
South Kivu Food Security Project Assesment Report on Market Systems 92 markets are Mudaka, Katana, Kavumu, Birava, Kabamba, Ihusi, Nyamukubi and Nyabibwe. The functioning cycle of visited market was mostly bi-weekly with few cases of daily cycle. Some of these markets can be considered as collection and assembling markets while others are larger markets. The table below indicates the markets visited during this assessment. Table 26: List of visited markets and their functioning cycle
Market Name Market Day Market Time Kabare Territory MUDAKA Thursday The whole day Sunday The whole day KATANA Wednesday The whole day Saturday The whole day KAVUMU Every day The whole day BIRAVA Wednesday Morning Saturday The whole day KABAMBA Monday The whole day Friday The whole day Kalehe Territory IHUSI Wednesday and Afternoon Sunday NYAMUKUBI Thursday Mid-day NYABIBWE Every day Mostly after noon
Map of markets visited The map below shows the location of the visited markets, availability of road and storage infrastructure, presence of financial institution, distance between markets and between markets and the lake. The surveyed markets are located within a distance of 5 to 15 km of each other in the FSP zone of intervention, which indicates that there is a good network between these markets. The road network is fairly good especially for those markets located on the main road such as Mudaka, Kavumu, Katana, Chabwenemwami / Kabamba, Ihusi, Nyamukubi and Nyabibwe. Of the markets that were visited, only Birava market is located some 15 km away from the main road to Bukavu-Goma but has ease access to the Lake. Storage facilities are available only in Ihusi and Birava market while financial institutions are available in Ihusi, Kavumu and Mudaka as indicated on the map.
South Kivu Food Security Project Assesment Report on Market Systems 93
Figure 25: Geographic map of visited markets
South Kivu Food Security Project Assesment Report on Market Systems 94 Table 27: Characteristics of Markets Visited
Market Market Characteristics name Market size Location and Market Proximity Market Availability of Services Observation accessibility Infrastructure to FSP actors commodities availability targeted population
Mudaka Big size with Easy access to Available but Near Many and Multiple Financial, utilities, Potential market to lots of main road and not sufficient targeted diversified commodities communication, be selected transactions, Lake Kivu population including market biweekly the livestock management whole day Kavumu Big size with Easy access to Available but Near Many and Multiple Financial, utilities, Potential market to lots of main road and not sufficient targeted diversified commodities communication, be selected transactions, near Kavumu population market daily airport, far to management Lake Kivu Birava Medium size, Near Lake Available Near Fewer Limited Some services Not a potential limited Kivu, far from targeted available such as market to be transactions, main road, population utilities, selected biweekly mostly feeder road communication and in the need market afternoons maintenance management Katana Big size with Near main Available but Near Many and Multiple Financial, utilities, Potential market to lots of road not far not sufficient targeted diversified commodities communication, be selected transactions, from the Lake population market biweekly the Kivu management whole day Kamamba/ Big with lots of Near main Available but Near Many but Multiple Utilities, Has potentiality to Chabwene transactions, road and Lake not sufficient targeted not commodities communication, be selected mwami biweekly the Kivu population diversified market whole day management
South Kivu Food Security Project Assesment Report on Market Systems 95 Ihusi Big with limited Near main Available but Near Limited Limited Financial, utilities, Potential transactions, road and Lake not sufficient targeted market commodities communication, (availability of biweekly mostly Kivu population actors market market shelter, afternoon management storage facilities, electricity, microfinance services) despite lack of market dynamism Nyamukubi Big with lots of Near main Available but Near Many but Multiple Utilities, Potential market to transactions, road and Lake not sufficient targeted not commodities communication, be selected biweekly the Kivu population diversified market whole day management Nyabibwe Medium size, Near main Not Available Near Fewer Limited Some services Not a potential limited road targeted available such as market to be transactions, population utilities, selected biweekly mostly communication and in the market afternoons management
South Kivu Food Security Project Assesment Report on Market Systems 96 CHAPTER 5: KEY INTERVENTIONS 5.1 High Priority Interventions
Based on the targets of the Food Security Project, and on the findings of this Market Systems Assessment, priority interventions were identified that should be implemented to improve the resilience of the market system. Specific interventions are proposed below to address challenges on each value chain node of production, post harvest and handling, processing and marketing. Proposed interventions are summarized in Table 20 below.
Table 28: Summary of identified needs and proposed interventions
Theme Proposed Interventions
Development of FSP Targeted Value Chain
Increase 1. Comprehensive identification of farmers' needs for agriculture inputs productivity of 2. Proper planning for inputs distribution targeted FSP 3. Establish seeds multipliers network and facilitate market linkages Commodities by 4. Comprehensive identification of farmers' needs for agriculture inputs 25% by 5. Proper planning for inputs distribution facilitating 6. Establish seeds multipliers network and facilitate market linkages access to quality 7. Promotion of farmer’s organizations and supplying them with inputs inputs and 8. Advocacy to the government for the exemption of agriculture inputs levies extension and fees services 9. Creation of public awareness for the importance of quality inputs use 10. Encourage private sector to invest in agriculture sector including production and inputs production (processing, blending, etc) 11. Organize farmers in association and cooperative whereby they can easily receive extension services 12. Develop appropriate training materials and provide timely trainings on agriculture best practice 13. Facilitate farmers’ access to inputs and to financial services especially through association and cooperatives 14. Promotion of mechanization, irrigation and mobilization of more investors in agriculture 15. Advocacy to the public and private actors for the establishment of incentives mechanisms to motivate agricultural extension agents 16. Sensitize and mobilize concession owners to allow smallholder farmers around them to use their land under fair contractual agreements (with a win-win situation) 17. Create farmer’s awareness for group selling of their produce to increase their bargaining power 18. Promote high yield, high value and nutritious crops to increase farmers’ income and nutrition Decrease post 1. Training farmers and traders on post-harvest and handling best practices harvest losses techniques by 15% by 2. Sensitize government and private sector to invest in post-harvest facilities
South Kivu Food Security Project Assesment Report on Market Systems 97 facilitating including drying and storage facilities farmers to 3. Facilitate farmers and traders access to post-harvest materials and access to post- equipment and to credit services especially through association and harvest facilities cooperatives and knowledge 4. Promotion of warrantage system helping farmers to access finance and on post - harvest storing their produce best practices 5. Organize transporters for better services 6. Increase farmers’ awareness on storing their produce and sell them when price is high 7. Enforcement of quality and hygienic standards for commodities Add value to 1. Trainings processors on quality of processed food and hygienic required targeted FSP for human food commodities by 2. Mobilize government and private sector to invest in cassava, maize and mobilizing beans and soy beans processing units and produce quality food investors in 3. Advocacy to government and private sector to invest in electrical power agro-processing production required for processing investment and facilitate 4. Promotion of the use of small and medium quality milling machine and access to quality measurement tools, appropriate 5. Promotion of the use of quality packaging equipment and 6. Link processors to product developer for diversification of processed skills on products standards and 7. Sensitize banks to facilitate processors access to finance (loan for quality investment and working capital) management 8. Link processors to farmers and traders for raw material supply in quality and quantity 9. Link processor to markets Increase farmers 1. Sensitize traders, farmers and other market actors to use standardized market access measurement tools and instruments and linkages 2. Facilitate access to standardized measurement tools and instruments between FSP 3. Promote the enforcement of the use of standardized measurement tools targeted and instruments commodities 4. Provide market information to all market actors though innovative web- markets actors based and mobile applications, media and bill boards 5. Introduce and promote innovative model such as contract farming 6. Sensitize banks to facilitate all market actors’ access to finance (loan for investment, working capital and deposit services) 7. Capacity building to reinforce the role markets committees 8. Sensitize market actors to use digital finance tools such as mobile money payment 9. Promote organized transport system Development of Selected Market System Improve Cassava 1. Facilitate farmers’ access to improved cassava cuttings Market System 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in agricultural good practices for cassava and on production costs and marketing 4. Train farmers on best practices of post-harvest, handling and storage for cassava 5. Facilitate the acquisition of post-harvest and handling equipment and materials for cassava farmers 6. Sensitize traders, farmers and other market actors to use standardized
South Kivu Food Security Project Assesment Report on Market Systems 98 measurement tools and instruments 7. Facilitate access to standardized measurement tools and instruments to all cassava market actors 8. Promote the enforcement of the use of standardized measurement tools and instruments 9. Mobilize investors (public and private) to invest in cassava value chain production and processing 10. Mobilize and sensitize big land owners to lease their non-exploited land to smallholder cassava farmers under fair agreements or arrangements 11. Provide market information to all cassava market actors though innovative web-based and mobile applications, media and bill boards 12. Facilitate business-to-business market linkages for cassava market actors 13. Introduce and promote contract farming between farmers and other market actors 14. Train cassava farmers on financial literacy 15. Sensitize financial institutions to facilitate all cassava market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 16. Sensitize cassava market actors to use digital finance tools such as mobile money payment 17. Capacity building to reinforce the role cassava market sub-committees 18. Organize transport system for cassava Improve Beans 1. Facilitate farmers’ access improved beans seed including climbing and Market System bio-fortified varieties 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in agricultural good practices for beans and on production costs and marketing 4. Facilitate farmers to acquire stakes (including reeds, use of agro-forestry trees, etc.) for climbing beans 5. Train farmers on best practices of post-harvest, handling and storage for beans 6. Facilitate the acquisition of post-harvest and handling equipment and materials for beans farmers 7. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments 8. Facilitate access to standardized measurement tools and instruments to all beans market actors 9. Promote the enforcement of the use of standardized measurement tools and instruments 10. Mobilize investors (public and private) to invest in beans value chain production, post-harvest (drying and storage) and processing 11. Mobilize and sensitize big land owners to lease their non-exploited land to smallholder beans farmers under fair agreements or arrangements 12. Provide market information to all beans market actors though innovative web-based and mobile applications, media and bill boards 13. Facilitate business-to-business market linkages for beans market actors 14. Introduce and promote contract farming between farmers and other market actors 15. Sensitize and train farmers on financial literacy best practices and warrantage and warehouse receipt systems 16. Sensitize financial institutions to facilitate all beans market actors to
South Kivu Food Security Project Assesment Report on Market Systems 99 access finance (loan for investment, working capital and deposit services) and lower cost of capital 17. Sensitize beans market actors to use digital finance tools such as mobile money payment 18. Capacity building to reinforce the role of beans market sub-committees 19. Organize transport system for beans Improved Maize 1. Facilitate farmers to access improved maize seed including hybrid and Market System bio-fortified varieties 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in agricultural good practices for maize and on production costs and marketing 4. Facilitate farmers to acquire fertilizers 5. Train farmers on best practices of post-harvest, handling and storage for maize 6. Facilitate the acquisition of post-harvest and handling equipment and materials for maize farmers 7. Sensitize traders, farmers and other market actors to use standardized measurement tools and instruments 8. Facilitate access to standardized measurement tools and instruments to all maize market actors 9. Promote the enforcement of the use standardized measurement tools and instruments 10. Mobilize investors (public and private) to invest in maize value chain production, post-harvest (drying and storage) and processing 11. Mobilize and sensitize big land owners to lease their non-exploited land to smallholder maize farmers under fair agreements or arrangements 12. Provide market information to all maize market actors though innovative web-based and mobile applications, media and bill boards 13. Facilitate business-to-business market linkages for maize market actors 14. Introduce and promote contract farming between farmers and other market actors 15. Sensitize and train farmers on financial literacy best practices and warrantage and warehouse receipt systems 16. Sensitize financial institutions to facilitate all maize market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 17. Sensitize maize market actors to use digital finance tools such as mobile money payment 18. Capacity building to reinforce the role of maize market sub-committees 19. Organize transport system for maize Improved Onion 1. Facilitate farmers’ access improved onion seed including red and white Market System varieties 2. Organize farmers in associations and cooperatives, and train them on organization management, ownership, business and marketing 3. Train farmers in good agricultural practices for onion and on production costs and marketing 4. Train farmers on best practices of post-harvest, handling and storage for onions 5. Facilitate the acquisition of post-harvest and handling equipment and materials for onion farmers 6. Sensitize traders, farmers and other market actors to use standardized
South Kivu Food Security Project Assesment Report on Market Systems 100 measurement tools and instruments 7. Facilitate access to standardized measurement tools and instruments to all onions market actors 8. Promote the enforcement of the use of standardized measurement tools and instruments 9. Sensitize farmers to discourage side-selling of onions 10. Mobilize investors (public and private) to invest in onions value chain production, post-harvest (drying and storage) and processing 11. Mobilize and sensitize big land owners to lease their non-exploited land suitable for onion production to smallholder farmers under fair agreements or arrangements 12. Provide market information to all onion market actors though innovative web-based and mobile applications, media and bill boards 13. Facilitate business-to-business market linkages for onions market actors 14. Introduce and promote contract farming between farmers and other market actors 15. Sensitize and train farmers on financial literacy best practices 16. Sensitize financial institutions to facilitate all onions market actors to access finance (loan for investment, working capital and deposit services) and lower cost of capital 17. Sensitize onion market actors to use digital finance tools such as mobile money payment 18. Capacity building to reinforce the role of onions market sub-committees and create new ones where they are not available 19. Organize transport system for onions
South Kivu Food Security Project Assesment Report on Market Systems 101 CHAPTER 6: CONCLUSION & RECOMMENDATIONS The Market Systems Assessment developed by the South Kivu Food Security Project (FSP) focused on the following two broad themes: (i) Value Chain Analysis, which analyzed the four FSP's targeted commodities (cassava, bean, maize and onion) and its different value chain nodes of inputs supply and production, post-harvest and handling, processing and marketing, and (ii) Market System Analysis for which market selection matrices have been developed and results discussed. The assessment recommends specific interventions to address challenges related selected market systems, as described in chapter 5 above. A plan to guide implementation of these interventions was developed as indicated in Table 29 below.
Table 29: Key interventions and implementation plan
Component Expected Results Intervention Timeline Responsible Y Y Y Y Y 1 2 3 4 5 Improve Increase Organize farmers (seed multipliers and X X X X X FSP, IPAPEL, INERA production of productivity of producers) in associations and and Other Stakeholders targeted FSP targeted FSP cooperatives and train them on Commodities Commodities by association and cooperative 25% by facilitating management and business access to quality management inputs and Identification of farmers needs in X X X X X FSP, IPAPEL, INERA extension services inputs, planning for their distribution and Other Stakeholders and link farmers to inputs suppliers Prepare training materials and X X X X X FSP, IPAPEL and Other organized farmers training on good Stakeholders agricultural practices using different methods including farmers demonstration plots Awareness campaign for the use of X X X X X FSP, IPAPEL and Other improved inputs including high yield Stakeholders varieties Sensitize and mobilize concession X X X X X FSP, IPAPEL, FEC, owners to allow smallholder farmers CARG and Other around them to use their land under fair Stakeholders contractual agreements Advocacy to the public and private X X X X X FSP, IPAPEL, FEC, actors for the establishment of CARG and Other incentives mechanisms to motivate Stakeholders agricultural extension agents Facilitate farmers' access to financial X X X X X FSP, FOPAC, FEC, services especially through association PAIDEC, PROCREDIT and cooperatives and Other Stakeholders Promotion of mechanization and X X X X X FSP, IPAPEL, FEC, irrigation in agriculture CARG and Other Stakeholders Establish an improved web-based and X FSP, IPAPEL, FEC, rapid SMS system for monitoring, CARG and Other
South Kivu Food Security Project Assesment Report on Market Systems 102 evaluating and reporting on agricultural Stakeholders production, post-harvest and marketing information Improve post Decrease post Training farmers and traders on post- FSP, FEC, OCC and - harvest and harvest losses by harvest and handling best practices X X X X X other Stakeholders handling for 15% by facilitating techniques targeted FSP farmers’ access to commodities post-harvest Sensitize Government and private FSP, FEC, CARG and facilities and sector to invest in post-harvest facilities X X X X X Others Stakeholders knowledge on post - including drying and storage facilities harvest best practices Facilitate farmers and traders access to FSP, FEC, CARG and post-harvest materials and equipment X X X X X Others Stakeholders and to credit services especially through association and cooperatives
Enforcement of quality and hygienic FSP, FEC, OCC and standards for commodities X X X X X other Stakeholders
Promotion of warrantage system FSP, FEC, CARG, helping farmers to access finance and X X X X X FOPAC and Others storing their produce Stakeholders
Organize transporters for a better FSP, FEC, CARG and services in post - harvest X X X X X Others Stakeholders
Create farmers and traders awareness FSP, FEC, CARG, on storing their produce and sell them X X X X X FOPAC and Others when price is high Stakeholders
Add value to Increase volume of Trainings processors on quality of X X X X X FSP, FEC, OCC and targeted FSP added value for processed food and hygienic required other Stakeholders commodities targeted FSP for human food by mobilizing commodities by investors in 25% and improve Mobilize Government and private X X X X X FSP, FEC, CARG and agro- quality of produce sector to invest in cassava, maize and Others Stakeholder processing beans processing units and onions and facilitate drying system to produce quality food access to appropriate Advocacy to Government and private X X X X X FSP, FEC, CARG and equipment sector to invest in Electrical power Others Stakeholder and skills on production required for processing standards investment and quality management Promotion of the use of small and X X X X X FSP, FEC, CARG, OCC medium quality milling machine and and Others Stakeholder quality measurement tools
Promotion of the use of quality X X X X X FSP, FEC, CARG, OCC packaging and Others Stakeholder
Link processors to product developer X X X X X FSP, FEC, CARG, for diversification of processed FOPAC and Others products Stakeholder
Sensitize banks to facilitate processors X X X X X FSP, FEC, CARG,
South Kivu Food Security Project Assesment Report on Market Systems 103 access to finance (loan for investment FOPAC and Others and working capital) Stakeholder
Link processors to farmers and traders X X X X X FSP, FEC, CARG, for raw material supply in quality and FOPAC and Others quantity Stakeholder
Link processor to markets X X X X X FSP, FEC, CARG and Others Stakeholder
Increase Farmers and FSP Sensitize traders, farmers and other X X X X X FSP, FEC, CARG and farmers targeted market actors to use standardized Others Stakeholder market commodities measurement tools and instruments access and markets actors have linkages updated market Facilitate access to standardized X X X X X FSP, FEC, CARG and between FSP information and are measurement tools and instruments Others Stakeholder targeted well linked commodities Sensitize banks to facilitate all market X X X X X FSP, FEC, CARG, markets actors access to finance (loan for FOPAC and Others actors investment, working capital and deposit Stakeholder services)
Promote the enforcement of the use of X X X X X FSP, FEC, CARG, OCC standardized measurement tools and and Others Stakeholder instruments
Provide market information to all X X X X X FSP, FEC, CARG and market actors though innovative web- Others Stakeholder based and mobile applications, media and bill boards
Introduce and promote innovative X X X X X FSP, FEC, CARG, model such as contract farming FOPAC and Others Stakeholder Capacity building to reinforce the role X X X X X FSP, FEC, CARG and markets committees Others Stakeholder
Sensitize market actors to use digital X X X X X FSP, FEC, CARG and finance tools such as mobile money Others Stakeholder payment
Promote organized transport system X X X X X FSP, FEC, CARG and Others Stakeholder
South Kivu Food Security Project Assesment Report on Market Systems 104
LIST OF KEY INFORMANTS INTERVIEWED N Institution Position o 1 IPAPEL Sud Kivu Inspecteur Provincial Sud Kivu 2 PROCREDIT Bukavu Chef d'Agence Bukavu (Banque) 3 PROCREDIT Bukavu Responsable d'Agence Bukavu (Banque) 4 CARG Sud Kivu Coordinatrice Provinciale
5 SK Value Chain Chief of Party Project 6 GAMF Kivu Secrétaire Exécutif du GAMF (réseau des IMFs) 7 IKYA (Coopérative de Coordinateur IITA Kalambo jeunes) Youth Agripreneurs 8 IKYA (Coopérative de Chargé de l'Entreprenariat jeunes) 9 Centre Olame Directrice 10 FAO Coordinateur du SNCOOP 11 HarvestPlus Chargé de la Production des semence 12 Chefferie Kabare Charge des Projets pour le Développement 13 Ets Ihusi et Ste Olive Charge de liaison \[1 IITA Coordinateur Centre de 4 Recherches 15 IITA Associe de Recherche en Socio- Economie 16 HarvestPlus Country Manager 17 PAIDEC - Kalehe Gérant 18 PAD Coordinateur 19 Territoire de Kalehe Charge du Développement Rural 20 Territoire de Kalehe Inspecteur de l'Economie
South Kivu Food Security Project Assesment Report on Market Systems 105 National 21 Territoire de Kalehe ITAPEL 22 UCOAKA Président du Conseil d'Administration 23 UCOAKA Gérant 24 GEV Coordonnateur 25 INERA Directrice
26 SENASEM Directeur
27 AGRIFORCE Directeur Gérant
28 AGRIFORCE Agronome
29 KOTECHA Directeur Administratif 30 Alimentation Labote Superviseur 31 FEC Sud Kivu Président de la Commission Agriculture Directeur du Bureau Technique 32 FEC Sud Kivu de la FEC Commission Agriculture Adjoint du Directeur du Bureau 33 FEC Sud Kivu Technique de la FEC - Agriculture 34 FOPAC Sud Kivu Charge de Projet a FOPAC Sud Kivu 35 FOPAC Sud Kivu Charge de Financement Agricole FOPAC Sud Kivu 36 COOPADI Président du Conseil d'Administration 37 AJP Mudaka Charge de Formation et Métiers 38 CAAK - Katana Charge de Production
South Kivu Food Security Project Assesment Report on Market Systems 106 39 Marche Nyamukubi Commerçant (haricots, maïs, manioc) 40 Marche Kabamba Président du Comité
41 Marche de Kabamba Membre du Comité 42 Marche de Kabamba Membre du Comité 43 Marche de Kabamba Membre du Comité
44 Marche de Kabamba Membre du Comité 45 Marche Ihusi Commerçant 46 Marche Nyabibwe Président du Comité du Marche
47 ADAC Multiplicateur de semences TUWONEMBERE 48 FEC Birava Président
49 Meusnier de Birava Président
50 Marche Kavumu Président du Comité
51 Marche Mudaka Président du Comité
52 Marche Beach Président du Comité Mwhanzi 53 Marche Beach Commissaire aux Comptes Mwhanzi 54 Mpungwe -Murhesa Commerçant (filière oignon) Center
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The author’s views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government.
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