Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan
EAST DARFUR STATE February 2016
Table of Contents
Acknowledgements ...... 3 Acronyms ...... 1 Executive summary ...... 2 1. Introduction ...... 3 1.1 Background ...... 3 1.2 Objectives of the analysis ...... 5 2. Definitions and theoretical framework ...... 6 2.1 Value chain ...... 6 2.2 Value chain analysis ...... 6 2.3 Value chain mapping ...... 6 2.4 Value chain development ...... 6 2.5 Access theory ...... 7 2.6 Conceptual framework ...... 7 3. Method ...... 8 3.1 Study area ...... 8 3.2 Research design ...... 8 3.3. Data collection ...... 9 3.4. Triangulation ...... 11 3.5 Data analysis ...... 11 3.6 Data presentation ...... 12 4. Results ...... 13 4.1 Overview of Gum Arabic production in East Darfur ...... 13 4.2 Structure of the Gum Arabic value chain ...... 15 4.3 Distribution of benefits and access analysis ...... 24 4.4 Constraints and bottlenecks ...... 30 5. Conclusions and recommendations ...... 33 5.1 Conclusions ...... 33 5.2. Recommendations ...... 34 References ...... 36
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List of Tables
Table 1: Types of actors, genders and locations
Table 2: Gum Arabic value chain actors and their activities
Table 3: Socioeconomic characteristics of the surveyed actors in the Gum Talha value chain
Table 4: Estimates of Gum Talha production in the surveyed localities (2016)
Table 5: Taxes and duty fees on gum Talha for 2013 and 2016, and beneficiaries
Table 6: Gum producers’ average yields, costs and profits (n꞊130)
Table 7: Village trader's average prices, costs and profits (n꞊50)
Table 8: Town trader's average prices, costs, profit (n꞊15)
Table 9: Mechanisms for maintaining and controlling benefits
Table 10: Constraints and bottlenecks, as identified by producers
Table 11: Recommended interventions in response to particular constraints and bottlenecks
List of Photos
Photo 1: Group discussion with gum producers in Um Sigayi weekly market
Photo 2a: A producer holding an axe
Photo 2b: A wound on a Talha tree
Photos 3a and 3b: Sticky gum from the Talha tree
Photo 4: Natural stands of Talha (A. seyal) in Gemayzia, Abu Jabra locality
Photo 5: A taya in the forest
Photo 6: An agent at Sinaidira in El-firdos locality
Photo 7: An old A. senegal tree (Hashab)
Photo 8: A female gum producer selling gum to a village trader in Boro market
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List of Figures
Figure 1. The conceptual framework
Figure 2: The area covered by the study
Figure 3: The sales channels for Gum Talha from East Darfur
Figure 4: Gum production costs (%)
Acknowledgements
The author, Dr. Yahia Omar Adam, is very grateful for the cooperation and support of the staff of the United Nations Environment Programme (UN Environment) and the Forests National Corporation (FNC) in Ed Daein who facilitated the field survey and accompanied me to the sites of the 'Natural Resource Management for Sustainable Livelihoods' project in East Darfur. The consultant also extends his gratitude to the UN Environment team in Khartoum.
Thanks also go the enumerators for their intense commitment over long hours in difficult conditions. In particular, thanks are extended to Mr. Adam Ibrahim, Mr. Mohamed Abuelgasim, Samia Madibo and Salma Abdulrahman from the FNC. Special thanks go to the drivers (Yosif and Mohamed) who ensured the field travel was on schedule.
Appreciation is also extended to Mr. Abdalla Adam Osman (the Director of the FNC East Darfur) and Mr. Abdalla Hemidan (Project Manager, UNOPS) for their diligence and assistance during the data collection. Very special thanks are also extended to all of the traditional leaders who accompanied and introduced us to the local people in the visited areas. My thanks also go to all the actors who deal with Gum Talha activities in the study areas for their welcoming reception and their provision of the required data.
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Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan
Acronyms o C degrees centigrade
FNC Forests National Corporation
GAC Gum Arabic Company
MT metric tons
NGO non-governmental organization
NTFP non-timber forest product
SDG Sudan ginah (USD 1 = 6.4 SDG)
UNEP United Nations Environment Programme
USD United States dollar
VCD value chain development
WFP World Food Programme
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Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan
Executive summary
This report describes the findings of a comprehensive and detailed value chain analysis for gum Talha, which sought to: i) identify the product chain, the actors involved, their activities and framework conditions; ii) determine the economic benefits and their distribution among the actors and how these benefits are maintained and controlled; iii) identify key constraints and bottlenecks and propose potential market-based solutions to develop the market chain of gum Talha; and iv) suggest interventions and a framework to develop the gum Talha value chain so as to increase benefits for the producers and the other actors.
The study, conducted in February 2016, used snowball sampling to select 197 study participants (130 producers, 50 village traders, 15 town traders/agents and two companies/exporters) along the value chain. Primary data was collected using semi-structured interviews, key informant interviews, group discussions and direct observations. The quantitative data was analyzed using SPSS version 20 and Excel 2010, while qualitative data was analyzed using text analysis.
The actors in the Gum Talha value chain include producers, village traders, town traders/agents, companies/exporters and consumers in international markets. The study found that the profit margin for the rural collectors was 48.76 per cent, while that for village traders was 54.94 per cent, and that for town traders was 6.4 per cent. The main cost items for the rural producers include food (45 per cent), labour (22 per cent), drinking water (18 per cent), gum transportation (9 per cent), medication (4 per cent) and tapping tools (2 per cent).
The study identified the major constraints and bottlenecks at the local level as: low gum prices, lack of market information, lack of producers' organizations, lack of financial credit, lack of training on gum cleaning and drying, lack of drinking water, low regeneration capacity of Hashab trees and poor tree management. The report concluded that the Gum Talha market chain profits mainly the processors and exporters.
In view of the study findings, the following interventions are recommended: establish drinking water points; build the capacity of gum producers; develop a market information system; facilitate access to financial credit and establish Talha stands (with community involvement).
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Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan
1. Introduction
1.1 Background
Non-timber forest products (NTFPs) have received greater attention in recent decades due to their potential to contribute to rural livelihoods and national economies (Arnold and Perez, 2001). The forests and woodlands of Sudan are a potential source for NTFPs and the sound development of these products could have a significant impact on livelihoods (Adam et al., 2013), especially among poor communities in dry land areas who have few options for economic development due to harsh climatic conditions (Adam, 2015).
NTFPs extracted from the woodlands of Sudan are consumed and traded locally and are also exported. Gum Arabic is one such NTFP. Gum Arabic not only offers an income and indemnity to farmers against seasonal fluctuations in the prices of their agricultural products (FAO, 2011), but is also an important source of foreign exchange to Sudan, annually injecting between 100 and 120 million USD into the economy, making it the most important NTFP in Sudan (Abdelmagid, 2014).
Prices in the international market for Gum Arabic have fluctuated greatly year to year, however, and production of Gum Arabic saw an overall decline in the three decades between 1970 and 2000. Between 1969/70 and 1973/74 production declined from about 35,000 tons to about 23,000 tons. This decline was reportedly due to drought. In subsequent years, production fluctuated and in 1984/85 fell to 11,000 tons, again due to drought. Production continued to decline overall, and in 1991/92 fell to about 7,000 tons. This time the decline was attributed to locusts. Subsequently, prices for Gum Arabic rose and production increased to about 39,000 tons in 1994/95. When prices fell, however, production declined accordingly, reaching a low of about 3,000 tons in 1999/2000.
Gum Arabic is mostly produced by rural producers in traditional rain-fed farming areas, including in Gedarif, Sinnar, Blue Nile, White Nile, all three states of Greater Kordofan and all five states of Greater Darfur. These areas contain up to 20 per cent of Sudan’s population, or around 6 million people, who are among the poorest and most vulnerable in the nation in terms of food insecurity (Couteaudier, 2007).
Gum Arabic is derived from two acacia species: Acacia senegal, known locally as Hashab, and Acacia seyal, known locally as Talh. Both species spread naturally in the central belt of the low- rainfall savannah where they grow in pure or mixed stands; in clay plains in the east and sandy soils in the west. Gum Arabic from Hashab is of higher quality and is mostly produced from trees grown on farmers' fields. Talh is more likely to grow wild, along the Nile as well as in Darfur, and to be tapped in the wild. According the field survey findings, annual yields of gum from Talh trees range between around 200 and 400 grams. The trees are exploited from the ages of 5 to 25.
Gum is produced by the trees in response to wounds; gum sap exudes to protect the tree (Abdel Nour, 2013). Exudation of gum often occurs naturally in response to damage caused by animals,
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Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan
insects, etc. Harvesting of gum by humans requires first wounding the trees using an axe (sunki). In Sudan, the wounding (tapping) of trees begins at the end of the rains and before the cold spell in October/November when tree growth stops, leaves are shed and trees begins the dormancy stage. In Darfur the season for tapping is November to May. The first harvest is four to six weeks after tapping and then gum is collected every 10 to 14 days, with between six and 12 collections each season (Seifel Din and Zarroug, 1996). The tapping process is normally carried out by hired labour (nafir) but collection of the gum is carried out mainly by family labour.
Gum Arabic production is one of the most important activities of the savannah forests of central Sudan. The significance of the income gained from gum production is that collection of Gum Arabic is carried out during the dry season. The activity therefore does not compete with farming activities. This allows farmers to make use of their slack period and acquire supplementary income. The activity employs all members of the family for between four and six months per year and provides seasonal labour for people from other parts of the country, who migrate to the gum belt area during the season.
Gum Arabic is sold by the producers (those who tap, collect, transport the gum) to local merchants, who in turn sell the product to town merchants (middlemen) and agents, who sell it to exporters and processing companies.
The producers generally transport their gum (using animals) to the village merchant who pays for it in cash or in kind. These transactions take place outside the organized and governmental- controlled markets. Thus, most producers do not receive the fixed minimum price; they get inadequate prices for their products. The local merchant serves as a link between the producers (who are unable to contact town merchants directly) and the town merchants who buy the gum and undertake the cleaning, grading, repackaging and sorting processes and who transport the gum to exporting companies. Very little Gum Arabic is consumed domestically and Sudan commands over 60 per cent of the world's Gum Arabic production and trade.
According to the Gum Arabic Board, at least 30 per cent of the Gum Arabic traded in Sudan is produced in Darfur. East Darfur is a particularly important production area for talha, from the Acacia seyal tree. According to Forests National Corporation (FNC) records, of the 32,000 metric tons (MT) of Gum Arabic produced 2014, 26,000 MT came from A. seyal and the remaining 6,000 MT came from A. senegal.
Gum Arabic and other natural resources have the potential to contribute significantly to the local rural economy in East Darfur as well as to the national economy, but this potential has not yet been fully exploited due to constraints on the commodity value chain.
The key factor affecting Sudan's Gum Arabic sector has been the national government policy for the product, particularly the domestic marketing arrangements and pricing (Buchanan-Smith et al., 2013). Low prices encouraged cross-border smuggling of Gum Arabic, especially from Darfur to Chad. In 2009, the Government of Sudan liberalized trade in Gum Arabic and committed to
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Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan
abolishing the export monopoly held by Gum Arabic Company (GAC). This liberalization had an immediate positive impact on producer prices.
The World Bank had long sought to boost the Gum Arabic sector in Sudan and was the major advocate of the liberalization of gum Arabic market to end the GAC's monopoly. The Multi-Donor Trust Fund (MDTF) managed by the World Bank co-funds work to boost Gum Arabic production in 11 localities in North and South Kordofan, White and Blue Nile, and the states of Sinnar and South Darfur, in collaboration with the International Fund for Agricultural Development (IFAD).
1.2 Objectives of the analysis
Against this background, the UN Environment conducted a Gum Talha value chain analysis in East Darfur, aiming to identify areas of intervention and recommendations for Gum Talha value chain development, so as to increase gum production, improve producers' market competitiveness and sustain gum Arabic producers' livelihoods.
The specific objectives of the analysis were to: