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Draft Final Report On DRAFT FINAL REPORT ON IDENTIFICATION OF AGRO PROCESSING CLUSTERS FOR RICE, WHEAT AND TOMATO FOR APPEALS PROJECT IN KANO STATE, NIGERIA SUBMITTED TO: KANO STATE AGRO-PROCESSING, PRODUCTIVITY ENHANCEMENT AND LIVELIHOOD IMPROVEMENT SUPPORT (APPEALS) PROJECT PREPARED BY Tafida, I., Idris A.A., and Abdullahi, Z. A. Contacts: +2348035868653, [email protected] 2nd August, 2019 1 LIST OF ABBREVIATIONS AND ACRONYMS APPEALS Agro-Processing, Productivity Enhancement and Livelihood Improvement Support APP Agricultural Promotion Policy FAO Food and Agriculture Orginization FGD Focus Group Discussion FGN Federal Government of Nigeria FMAWR Federal Ministry of Agriculture and Water Resources GDP Growth Domestic Product PDO Project Development Objective M&Es Monitoring and Evaluation 2 TABLE OF CONTENTS CONTENT PAGE Title page…………………………………………………………………………………... 1 Abbreviations and Acronyms……………………………………………………………… 2 Table of Contents…………………………………………………………………………...3 Summary……………………………………………………………………………………5 1.0 Introduction…………………………………………………………………………6 2.0 Methodology………………………………………………………………………..7 3 LIST OF TABLES Table Page 4 LIST OF FIGURES Figure Page 5 EXECUTIVE SUMMARY The Kano State Agro-processing, Productivity Enhancement and Livelihood Improvement Support Project (APPEALS) survey on the Identification of Rice, Wheat and Tomato processing clusters was conducted between 15 th July and 2 nd August, 2019. The main objective of this study is to identify and assess the small scale cottage processing industries and to map out areas, activities and benefits accrued to the processing units and clusters in Kano State and develop and present a detailed and clear picture on what small agro-processing systems require to effectively manufacture and market processed products based on the strength of each unit and cluster; and to review agro-processing service provision in relation with other value added services. The study was conducted in Kano State and cover five Local Government Areas namely, Bagwai, Bunkure, Garko, Kura and Tudun Wada Local Government Areas. Despite the intervention by Sasakawa, IITA, IFAD, PROFCOM and others on production agro- processing and the employment opportunities thereby created, the current market forces and the prevailing economic environment tend to favour more growth of large scale processing systems and neglecting of small scale processing enterprises. The loss of business by small-scale processors has led to unemployment and even closure of factories whilst women processors got disempowered by loss of individual and co-operative agro-processing enterprises. The Kano State agro-processing industry plays a vital role in the national economic development and has potential to meet the local needs and export requirements. The supporting infrastructure for this industry in terms of capital, electricity supply, roads and telecommunication network etc. is below far. Also, there are no established skills training programmes in manufacturing (tool making, welding), for rural artisans and users. However, the sector currently faces many challenges emanating from the poor performance of the national economy, uncertainties that exist over access to both local finances, limited research, limited technical advice, limited marketing information and lack of reliable markets. Key lessons that emerged from the study are that equipment ownership (individuals, farmer groups or entrepreneurs) has been left for people to decide without adequate technical advice. Tomato is widely processed in Tudun wada even though sun dry method was the method for 6 processing. Equipment costs are beyond the reach of individuals and farmers group and the prevailing economic environment favours technology access rather than ownership. One survival strategy being adopted by many small-scale processors is sub-contracting some operations like de-stoning and packaging to medium scale processors that meet the higher standards, to processed products for the small-scale processors to pack and market in the case of rice processing. 7 1.0 BACKGROUND INFORMATION 1.1 Brief on APPEALS Project Agro-Processing, Productivity Enhancement and Livelihood Improvement Support (APPEALS) Project is a World Bank Assisted Project of the Federal Government of Nigeria (FGN) through the Federal Ministry of Agriculture and Water Resources (FMAWR). The objective of the project is to enhance agricultural productivity of small and medium scale farmers and improve value addition along priority value chains in the participating states (Cross Rivers, Enugu, Kaduna, Kogi, Kano, and Lagos). The Project Development Objective (PDO) will be achieved through: (i) supporting farmers’ productivity and their linkage to markets, (ii) facilitating consolidation of agricultural products and cottage processing, (iii) facilitating farmers and small and medium businesses’ clustering and connection to infrastructure network and business services, (iv) providing technical assistance and institutional support both to beneficiaries, federal and state governments in value chain development. Increased agricultural productivity, production, and improving processing and marketing of the targeted value chains are expected to help in job creation in the participating States. The project is expected to achieve: increase in productivity of agricultural produce of priority value chains by project- supported farmers; increase in processed output of priority value chains by project beneficiaries; increase in number of beneficiaries supported by the project (separate percentages of beneficiary, women and youth). The Federal Government through its Agricultural Promotion Policy-The Green Alternative (APP-2016-2020), has listed the value chains that are a priority for the country. These priority value chains are chosen due to their potential in contributing to the governments stated primary objectives of: (i) food security and local production; (potential for exports; and (iii) contribution to improvement of livelihoods, and speedy income generation including job creation along the value chains. Although the APP clearly defines the Federal Government priority value chains, yet, this project’s preference for value chains is narrowed down to cereals (rice, maize and wheat), cassava, cocoa, cashew, poultry, aquaculture and horticulture (e.g. ginger, tomatoes and banana). The selected value chains have to contribute directly to at least two of the three goals of the government, i.e. food security and local production, exports, and livelihood improvement. 8 Thus, the project will focus on a limited number of value chains out of the list identified by the Federal Government as part of APP. Kano State has identified three priority value chains as its target in the project implementation, namely: Rice, Wheat and Tomato. The number of project’s direct beneficiaries is estimated at 60,000 individuals (i.e. 10,000 beneficiaries per state), and 300,000 farm household members as indirect beneficiaries. It is anticipated that 35 percent of direct beneficiaries (or 21,000 individuals) will be women. By design, the project has a dedicated sub-component to benefit women and youth that will allow them to develop agri-businesses that are expected to create jobs and improve their livelihoods. The project monitoring and evaluation (M&E) and information system will include a gender tracker to ensure adequate documentation on different categories of project beneficiaries. Although Nigeria has a distinct comparative advantage in the agriculture sector yet the production system has not developed in terms of significant value addition or processing, and has remained a producer of mainly staple crops. The project aims at supporting transition of small subsistence farmers’ production system (farming 1-5 ha) to a market-oriented agricultural undertaking, and supporting middle size farmers (5-10 ha) to address constraints in enhancing their productivity as well as effective participation in value chains. The agriculture sector of Nigeria is characterized by low productivity; little and untimely access to inputs; lack of seed funds for establishing agro-processing plants by producer cooperatives; lack of access to supportive infrastructure; challenging business environment; limited access to markets; low level of technology adoption; weak quality control mechanism; and low capacity at all levels. Following the government policy thrust of promoting value chain approach to achieve the APP goal, project intervention will consist of tackling key constraints, which hinder the development of the value chains, and prevent greater inclusion of small and medium scale farmers in agribusiness supply chains. 1.2 Objectives of the Study The main objective of this study is to identify and assess the small scale cottage processing industries and to map out areas, activities and benefits accrued to the processing units and clusters in Kano State and develop and present a detailed and clear picture on what small agro- processing systems require to effectively manufacture and market processed products based on the strength of each unit and cluster; and to review agro-processing service provision in relation with other value added services. 9 The specific objectives are to; i. to identify and map out areas where agro-processing activities are taken place and where they are dominantly located across the value chains (Rice, Wheat, Tomato).within Kano State, ii. identify key actors within and across the agro-processing value chains and find out the capacity and
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