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Wild-Collected Botanicals and the Eu Market Final Report.Pdf 3.27 MB Trade for Development Centre – BTC (Belgian Development Agency) Author: ProFound – Advisers In Development http://www.ThisIsProFound.com Managing editor: Carl Michiels, BTC, 147 rue Haute, 1000 Brussels Cover: Compiled by ProFound © BTC, Belgian Development Agency, 2014. All rights reserved. The content of this publication may be reproduced after permission has been obtained from BTC and provided that the source is acknowledged. This publication of the Trade for Development Centre does not necessarily represent the views of BTC. 2 Trade for Development Centre – BTC (Belgian Development Agency) Table of contents 1. INTRODUCTION .........................................................................................................................4 1.1 Market channels .................................................................................................................. 4 1.2 Raw materials vs. processed materials .............................................................................. 6 1.3 Segmentation ...................................................................................................................... 6 2. COUNTRY BACKGROUNDS .....................................................................................................8 2.1 Bolivia .................................................................................................................................. 8 2.2 Peru ..................................................................................................................................... 9 2.3 Ecuador ............................................................................................................................. 11 2.4 United Republic of Tanzania ............................................................................................. 12 2.5 Mozambique...................................................................................................................... 14 2.6 Vietnam ............................................................................................................................. 15 3. POTENTIAL MARKET SEGMENTS........................................................................................ 18 3.1 High potential cross- and sub-segments .......................................................................... 19 4. MARKET ACCESS REQUIREMENTS .................................................................................... 21 4.1 Legislative requirements ................................................................................................... 21 4.2 Non-legislative requirements ............................................................................................ 21 5. TRENDS AND DEVELOPMENTS FOR DIFFERENT SEGMENTS ........................................ 24 6. POTENTIAL EUROPEAN MARKETS ..................................................................................... 27 6.1 European imports .............................................................................................................. 27 6.2 European exports .............................................................................................................. 31 6.3 Promising EU export markets ........................................................................................... 34 6.4 European buyer perspective ............................................................................................. 35 7. OPPORTUNITIES AND THREATS ......................................................................................... 36 8. PRIORITY LIST ........................................................................................................................ 38 9. CONCLUSIONS ....................................................................................................................... 85 LITERATURE SOURCES ..................................................................................................................... 89 ANNEX I ................................................................................................................................................ 96 ANNEX II ............................................................................................................................................. 100 ANNEX III ............................................................................................................................................ 109 ANNEX IV ............................................................................................................................................ 112 3 Trade for Development Centre – BTC (Belgian Development Agency) 1. Introduction The Trade for Development Centre (TDC – www.befair.be) of the Belgian Development Agency (BTC) aims at economic and social empowerment of small producer organisations, by both enhancing business knowledge and improving their access to markets. TDC implements a Producer Support Programme through which financial and technical assistance is provided to producer organisations. Within the framework of this programme, TDC has decided to carry out a market study on wild-sourced botanicals and the EU market, thus anticipating the growing opportunities for these products in the food, cosmetics and pharmaceutical industries. The results of this study will be provided, among others, to ethical actors. In this context, the study focuses on wild-collected MAPs which have a potential for livelihoods enhancement and conservation action. Moreover, these species are assessed in terms of sustainable trade. The countries covered in this study are Bolivia, Peru, Ecuador, Tanzania, Mozambique and Vietnam. Methodology The list of 20 botanicals investigated in this study is derived from a long list of prioritised species according to biodiversity and trade programmes in the 6 target countries. The narrowing down of these species, in consultation with local and European experts & organisations, was based on the following criteria: Marketing criteria: scale of production, market readiness, competition, product standards and certification potential. Ecological criteria: availability, sustainability of supply, resource management, certification (potential). Socio-economic criteria: local benefits, value addition potential, fair labour conditions. Technological criteria: (adherence to) processing and quality requirements, traceability and availability of human resources/access to technology. Product definition In order to obtain a broad overview of trade and potential of wild-collected species, natural gums and resins and plant derived materials (herbal extracts, essential and vegetable oils) are included together with medicinal and aromatic plants (MAPs). In this study, these species and their derivatives are referred to as MAPs. The potential of these species is based on their uses in food, cosmetic and health industries. For an overview of these segments, please refer to section 1.3 on segmentation. These industries remain dependent on wild-collected materials for various species, as a result of the high cost or difficulty of cultivation if a limited quantity is needed. 1.1 Market channels Regardless of the final segment in which they are used, wild-collected MAPs have a similar value chain (Figure 1). In the country of origin, the MAPs are collected, after which they can be processed locally and traded to the EU. The products can be exported both as raw materials and as processed products, such as extracts or essential oils (see section 1.2). Traditionally, most extraction has taken place in Europe. More recently, for certain MAPs, this is shifting towards the countries of origin, which offers good value addition opportunities for exporters in the region. Whether or not MAPs are processed at origin depends on various factors. Ingredients with most potential for at origin extraction are perishable botanicals with low technological barriers to enter the market and for which producers can ensure traceability and a consistent quality and quantity at a commercially attractive price. 4 Trade for Development Centre – BTC (Belgian Development Agency) Figure 1 Overview of Market Channels for the food, cosmetic and health segments As can be seen in chapter 5, industry consolidation, which occurs for food, cosmetics and health segments, is changing the landscape for natural ingredients. This has an influence on the relevant market channels for these ingredients as well. Larger players have more market power, but smaller processors remain active as well. Therefore, it is important for small or community exporters from DCs to target the right partner in Europe. For specialised/premium or certified ingredients that are available in small volumes, specialised traders are most relevant. For these ingredients, value chains tend to be much shorter as importers generally source directly from the country of origin. Most commonly, ingredients are exported through exporters or processors. As European companies are shortening their value chains, roles of local/community traders are becoming more limited. Depending on various factors, extraction at origin or in Europe is more prevalent. These factors include the complexity of the extract, associated risks, the specific (sub-) segment the extract is used in and feasibility of extraction in Europe. For certain raw materials, for example açai fruits, extraction in Europe is not an option as the product deteriorates too quickly. The fruits need to be processed within 24 hours. For all segments,
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