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Farmer Perceptions, Child Labour, and Economics of Tree Crops Production and Marketing in Kailahun,

Kenema and Kono Districts of Sierra Leone

October, 2009

This publication was produced for review by the Promoting Agriculture, Governance and the Environment (PAGE) Project.

It was prepared by Enterprise Development Services Ltd

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ENTERPRISE DEVELOPMENT SERVICES LTD

5 Sir Samuel Lewis Road ~ P. M. B. 108 ~ Freetown ~ Sierra Leone


Kenema and Kono Districts of Sierra Leone

Dunstan S. C. Spencer

October 1, 2009

DISCLAIMER The results presented and views expressed in this report are the sole responsibility of the author and do not in any way engage World Vision Sierra Leone, ACDI/VOCA, ARD or USAID

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TABLE OF CONTENTS

LIST OF TABLES ................................................................................................................. 4 LIST OF FIGURES ............................................................................................................... 5 LIST OF ACRONYMS ......................................................................................................... 6 EXECUTIVE SUMMARY ................................................................................................... 7

CHAPTER 1. INTRODUCTION ...................................................................................... 11 1.1: Study Objectives ........................................................................................................... 11 1.3: Study Methodology....................................................................................................... 11

CHAPTER 2. KNOWLEDGE, ATTITUDES AND PERCEPTIONS STUDY ............... 12 2.1: Objectives ..................................................................................................................... 12 2.2: Methodology ................................................................................................................. 13 2.3: Knowledge Among Cocoa Farmers ............................................................................. 14 2.4: Knowledge among Coffee Farmers .............................................................................. 17 2.5: Knowledge among Oil Palm Farmers ........................................................................... 19 2.6: Conclusions ................................................................................................................... 20

CHAPTER 3. CHILD LABOUR STUDY ........................................................................ 21 3.1: Objectives ..................................................................................................................... 21 3.2: What is Child Labour? .................................................................................................. 21 3.3. Methodology ................................................................................................................. 23 3.4. Child Work in Cocoa Farming ...................................................................................... 24 3.5. Child Work in Coffee Farming ..................................................................................... 28 3.6. Child Work in Oil Palm Farming .................................................................................. 29 3.7. Conclusions ................................................................................................................... 30

CHAPTER 4. PRODUCTION COSTS AND RETURNS ................................................ 32 4.1 Methodology .................................................................................................................. 32 4.2: Cocoa Production .......................................................................................................... 32 4.3. Coffee Production ......................................................................................................... 34 4.4 Oil Palm Production ....................................................................................................... 38 4.5: Conclusion .................................................................................................................... 41

CHAPTER 5. MARKETING CHAIN STUDY ................................................................ 41 5.1. Cocoa and Coffee Marketing Chain ............................................................................. 41 5.2 Oil Palm Produce Marketing Chain ............................................................................... 47 5.3: Conclusion .................................................................................................................... 48

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LIST OF TABLES

Table 1: Location of Focus Group Interviews ......................................................................... 14 Table 2: Number of Children in Sample, and percentage participating in Cocoa Farming Activities in Ghana .................................................................................................................. 26 Table 3: Age and Size of Plantations, Proportion of Farmers Using Inputs (percent) and Average Quantities Used by Farmers Using the Input in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season .............................................................................................. 33 Table 4 Proportion of Farmers Using Hired Labour (percent), Quantities Used by Farmers Using Hired Labour (person days per hectare) and Average Wage Rates (Leones per person per day) in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season ..................... 33 Table 5 Use of Family Labour in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season ...................................................................................................................................... 35 Table 6: Cost and Returns in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season ...................................................................................................................................... 35 Table 7: Age and Size of Plantations, Proportion of Farmers Using Inputs (percent) and Average Quantities Used by Farmers Using the Input in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season .............................................................................................. 36 Table 8: Proportion of Farmers Using Hired Labour (percent), Quantities Used by Farmers Using Hired Labour (person days per hectare) and Average Wage Rates (Leones per person per day) in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season ..................... 36 Table 9: Use of Family Labour in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season ...................................................................................................................................... 37 Table 10: Cost and Returns in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season ...................................................................................................................................... 37 Table 11: Age and Size of Plantations, Proportion of Farmers Using Inputs (percent) and Average Quantities Used by Farmers Using the Input in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season .............................................................................................. 39 Table 12: Proportion of Farmers Using Hired Labour (percent), Quantities Used by Farmers Using Hired Labour (person days per hectare) and Average Wage Rates (Leones per person per day) in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season ................. 39 Table 13: Use of Family Labour in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season ............................................................................................................................. 40 Table 14: Cost and Returns in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season ...................................................................................................................................... 40 Table 15: Average Cost and Returns in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season (without two largest farms in Kenema – 16.3 & 13.2 ha) ......................... 41 Table 16: Proportion of Sample Farmers Making Sales of Tree Crop Products and Average Quantities Sold, Sierra Leone, 2008 ........................................................................................ 42 Table 17: Marketing Cocoa and Coffee by Point of First Sale and Buyers in Sierra Leone, 2008 (Percent of farmers in a District who made sales) .......................................................... 44 Table 18: Sierra Leone Coffee and Cocoa Export Volumes and Prices .................................. 46 Table 19: Estimated Marketing Margins for Cocoa and Coffee in Sierra Leone, 2008 Buying Season (Le 1,000 per mt) ......................................................................................................... 46 Table 20: Marketing Palm Oil by Point of First Sale and Buyers in Sierra Leone, 2008 (Percent of farmers in a District who made sales) ................................................................... 47

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LIST OF FIGURES

Figure 1: Four stages in the Knowledge elicitation process .................................................... 13 Figure 2: Participation of Infants (0-5Years) In Cocoa Family Farm Activities ..................... 24 Figure 3: Participation of Children (13-14 Years) in Cocoa Family Farm Activities ............. 24 Figure 4: Participation of Children (6-12 Years) in Cocoa Family Farm Activities ............... 25 Figure 5: Participation of Youths (15-17 Years) in Cocoa Family Farm Activities ................ 25 Figure 6: Children in Primary School ...................................................................................... 27 Figure 7: Children in Secondary School .................................................................................. 27 Figure 8: Participation of Infants (0-5Years) In Coffee Family Farm Activities .................... 28 Figure 9: Participation of Children (6-12 Years) in Coffee Family Farm Activities............... 28 Figure 10: Participation of Youths (15-17 Years) in Coffee Family Farm Activities ............. 29 Figure 11: Participation of Children (13-14 Years) in Coffee Family Farm Activities ........... 29 Figure 12: Participation of Children (6-12 Years) in Oil Palm Family Farm Activities ......... 29 Figure 13: Participation of Youths (15-17 Years) in Oil Palm Family Farm Activities .......... 30 Figure 14: Participation of Children (13-14 Years) in Oil Palm Family Farm Activities ....... 30 Figure 15: Cocoa and Coffee Marketing Channels in Sierra Leone ........................................ 43 Figure 16: Flow of Sierra Leone Cocoa from producing areas to export market in 2008 (export volume from COMTRADE) ....................................................................................... 45 Figure 17: Marketing Channels for Palm Oil in Sierra Leone ................................................. 48 Figure 18: Flow of Palm Kernels from Buying Centres to Freetown ...................................... 49

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LIST OF ACRONYMS

Acronym DescriptionCORAD Consortium for Rehabilitation and Development DFID Department for International Development DTIS Diagnostic Trade Integration StudyDTIS Diagnostic Trade Integration Study EC European Commission EDS Enterprise Development Services Ltd EU European UnionFFB Fresh Fruit Bunches FFS Farmer Field Schools IADP Integrated Agricultural Development ProjectIITA International Institute of Tropical Agriculture ILO International Labour Organization KAP Knowledge, Attitude and PerceptionsLEAD Livelihood Expansion for Asset Development MAFFS Ministry of Agriculture, Forestry and Food Security MT Metric Ton NRM Natural Resource Management PAGE Promoting Agriculture, Governance and the Environment SLARI Sierra Leone Agricultural Research Institute UN United NationsUNDP United Nations Development Programme UNHCR United Nations High Commission for Refuges UTB Union Trust Bank WFCL Worst Forms of Child LabourWVSL World Vision Sierra Leone

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EXECUTIVE SUMMARY

The general objective of this study of tree crops production and marketing was to identify production, marketing, and institutional needs in the cocoa, coffee and oil palm sectors. The study was also designed to describe the marketing chain, and if possible measure marketing margins along that chain and determine how various institutional arrangements affect market efficiency, product quality, and the efficacy of policy prescriptions. Both quantitative and qualitative methods were used to generate data from 12 chiefdoms in the Kailahun, Kenema and Kono Districts. Knowledge, Attitudes and Perceptions (KAP) Study The objective of the KAP Study was to develop an understanding of the knowledge, attitudes and perceptions of smallholder tree crop farmers (cocoa, coffee and oil palm) in the target area. It was decided to undertake the study because of the generally held belief among development agencies that a significant consequence of the country’s ten‐year civil war was the untimely transfer of ownership and management of tree crop farms from an older generation to a younger one, which is poorly trained for its responsibilities. Focus group interviews were the main method used for knowledge elicitation. The KAP study revealed that contrary to the assumption by development agencies, farmers have not lost the knowledge of how to process and produce good quality cocoa and coffee. They are currently producing poor quality produce because they have no incentive to produce the better quality. In fact the incentive is to produce poor quality as they earn a higher income from relatively wet cocoa beans which weigh more than the dry beans. Indications are that a price differential of Le 1000 ‐ Le 1500 per kg would be sufficient inducement for farmers to produce Grade 1 cocoa. The most important constraint faced by tree crop farmers is the cost of obtaining hired labour for the under‐brushing activity. Credit schemes that provide seasonal loans for the activity would significantly improve farmer’s capability to increase tree crop output from existing farms. Child Labour Study The specific objective of the Child labour Study was to quantify the incidence and nature of child labour in the tree crop farming systems. Household heads were asked about the participation of their children and wards in tree crop farming activities. This study shows that children work on tree crop farms at similar levels and over the same range of activities as found on Ghanaian cocoa farms, except that without the use of fertilisers and agro chemicals on Sierra Leone farms, children in this country are not exposed to the hazards of application of chemicals, and children under 15 years are not engaged in particularly hazardous tasks such as harvesting and splitting of palm fruit bunches.

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Using the definition of the ILO that child labour refers to work that is mentally, physically, socially and morally dangerous and harmful to children; and interferes with their schooling by depriving them of the opportunity to attend school; as well as the definitions in the Sierra Leone Child Rights Act, the conclusion from this study is that child labour does not exist to any noticeable extent in tree crops farms in Sierra Leone. Furthermore, it very important to note that the work of children is on their parents’ farms and that there is clear evidence that parents and guardians take care not to expose the children to very hazardous work. There is no evidence from this study of slavery in tree crop farming in Sierra Leone – there is no bonded, forced or compulsory labour. Cost of Production Study About ten households were selected for study from three localities in each of the twelve chiefdoms ‐ located at the chiefdom headquarters town, a village near and another far from the headquarters town. Data was collected using a household farm production questionnaire.

The study revealed that cocoa farms averaged between 2.7 ha in Kenema and 3.3 ha in Kono, and yields averaged 180 – 320 kg/ha, which is less than the average of 400 kg/ha normally assumed for Sierra Leone cocoa before the civil war and significantly less than the potential yield of 1‐1.5 mt/ha with the new hybrid varieties grown in Ghana and Côte d’Ivoire. Similarly, although quite low compared to the average of 400 – 600 kg/ha projected for rehabilitated coffee farms and 800 kg/ha from new plantations, yields on coffee farms at 112 kg/ha in Kailahun and 245 kg/ha in Kenema , are much higher than the previously reported average of 40 kg/ha for coffee in Sierra Leone. Coffee farm sizes average between 2.4 ha in Kailahun and 2.9 ha in Kenema. District averages for small holder oil palm plantations ranged between 1.8 ha in Kailahun and 3.0 ha in Kenema and average palm oil yields range from 26 gal/ha in Kenema to 54 gals/ha in Kailahun. From the analysis it is clear that small holder tree crop farming is very profitable under current pricing regimes. Apart from palm oil production in Kenema where average net returns to family labour were negative because of low yields from relatively large plantations (over 12 ha), net returns to family labour were substantially greater than the going wage rates, ranging from around 50% to almost 400% higher than the hired labour wage rate. However yields are low and there is obviously much scope for increasing them using improved planting materials and cultural practices. Development agencies should concentrate on helping farmers to invest in the new technologies. The supply of improved planting materials is critical in this regard and the clonal gardens of the Sierra Leone Agricultural Research Institute should be rehabilitated and expanded to provide a domestic source of supply.

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Marketing study The aim of the marketing study was to describe the off farm marketing system for Cocoa, Coffee and Oil palm products that supply domestic markets in Sierra Leone, and the export markets in neighbouring countries as well as the international trade. Tracing studies were conducted from each major assembly/buying point in each selected chiefdom to Freetown. Backward tracing studies from the port of Freetown were also conducted for a number of cocoa and coffee exporters.

Marketing channels for cocoa and coffee are similar, usually with the same agents handling both commodities. Virtually all cocoa and coffee farmers made sales in 2008, except for coffee farmers in Kenema where the proportion was low at about 82 percent indicating that some 20 percent of the farmers still found the price too low to enter the market. Average cocoa sales per famer ranged from 620 kg in Kailahun to 655 kg in Kenema, while average coffee sales ranged from 253kg in Kailahun to 413kg in Kono, and palm oil sales from 125 kg in Kailahun to 194kg in Kenema. Virtually all sales are made to Traders (Buying Agents of the exporters), and the transaction takes place most often at the Village in which the farmer resides. Assembly and transport of cocoa and coffee beans from the villages in which farmers reside to the Stores of the Exporters in the District headquarter towns (Kono, Kailahun and Kenema) is by the buying agents of the Exporters. The exporters set the price of the produce and provide the buying agents with a buying commission. They also as a rule provide the agents with a short term loan which is recovered in the form of produce delivered to the Exporters stores. Estimated quantities of cocoa and coffee exported to Europe as reported locally by the Bank of Sierra Leone and internationally in UN Statistics are significantly different. Although there is likely o be some double counting of export quantities as reported in import figures by Sierra Leone’s external trade partners, the substantial difference in export price between the FOB price reported in Bank of Sierra Leone statistics and the CIF prices reported in the UN trade statistics (over 100% difference) cannot be explained by double counting of export volumes. The inevitable conclusion is that there is significant under reporting of export volumes and particularly of export prices in the local statistics. The extreme reluctance of exporters to disclose the export price to EDS investigators while they were very willing to reveal their costs of operations, lends credence to this view. Using the CIF Europe prices reported in the UN Statistics the exporter’s margins (including the margins by the Buying Agents) are estimated at 86% of the farm gate price for coffee and 107% for cocoa. The negative margins shown when Bank of Sierra Leone FOB export prices are used confirms that the reported prices are unrealistically low – they were even lower that the farm gate prices reported by farmers in the farm survey! This study therefore shows that profit margins by exporters of cocoa and coffee are high, even for the poor quality of produce supplied to the international market. There is therefore scope for increased payments to farmers, particularly for payment of a premium for high quality produce.

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There is a latent market for palm kernels as the Marika Oil mill in Freetown which is currently operating at less than 50% of its capacity. Investment in a marketing system for palm kernels will help open up the market as the Company is currently only able to purchase and transport cracked nuts. Cracking of nuts manually is a very labour consuming activity with relatively low returns, restricting the supply to the Mill. The supply of uncracked nuts is much greater.

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Kenema and Kono Districts of Sierra Leone By

Dunstan S. C. Spencer Enterprise Development Services Ltd

CHAPTER 1. INTRODUCTION 1.1: Study Objectives

The general objective of the study was to identify production, marketing, and institutional needs in the cocoa, coffee and oil palm sectors and establish baseline parameters for monitoring and evaluating policy reforms and project implementation, in addition to determining the potential of farm‐level diversification into other smallholder enterprises. The study was also designed to describe the marketing chain, and if possible measure marketing margins along that chain and determine how various institutional arrangements affect market efficiency, product quality, and the efficacy of policy prescriptions.

Specific Objectives

• Conduct a baseline survey in targeted chiefdoms to collect information on current production levels, production factors (quantity and quality of land, labour, capital and material inputs), agricultural technology employed, household demographic information, production costs and returns

• Conduct a Knowledge, Attitude and Perceptions (KAP) study on child Labour in the cocoa and coffee sub‐sectors to quantify the incidence and nature of child Labour and create a robust knowledge base of child Labour.

• Develop a detailed understanding of the knowledge, attitudes and perceptions (KAP) of smallholder cocoa and coffee farmers on factors such as technology, pest and disease problems and the loss of knowledge inherited from their ancestors, and the subsequent relationship with environmental risks in rehabilitation and replanting.

• Conduct a marketing survey to collect primary data at the farm, buying centre and port to describe the present cocoa and coffee marketing systems, and if possible quantify marketing margins and inventories, and identify constraints regarding cocoa and coffee marketing at all levels of the marketing system.

1.3: Study Methodology

Both quantitative and qualitative methods were used to generate data on the production, marketing, management and knowledge and perception studies from each of the selected cocoa, coffee and oil palm producing chiefdoms in the three Districts. Details are provided in the following Chapters of the report.

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CHAPTER 2. KNOWLEDGE, ATTITUDES AND PERCEPTIONS STUDY

2.1: Objectives

The objective of the Knowledge, Attitudes and Perceptions (KAP) study was to develop a detailed understanding of the knowledge, attitudes and perceptions of smallholder tree crop farmers (cocoa, coffee and oil palm) in the PAGE target area, on such factors as technology use, pest and disease problems, the loss of knowledge inherited from ancestors, and the relationship with environmental risks in rehabilitation and replanting of plantations. It was decided to undertake the study because of the generally held belief among development agencies that a significant consequence of the country’s ten‐year civil war was the untimely transfer of ownership and management of tree crop farms from an older generation to a younger one. In normal times such transfers take place after years of training and tutelage during which skills and knowledge are passed on. However, the ten‐year war caused the demise of many farmers. New farmers, comprising of women and youths have allegedly taken over responsibilities for which they are poorly trained. As reported in the Diagnostic Trade and Integration Study (DTIS) report1, West African cocoa is always in demand for the relatively hard butter it produces which is well suited to maintaining the snap of chocolate that has softer milk fats added in. Cocoa beans from Sierra Leone are considered to be high fat beans with a liquor content equivalent to Nigerian cocoa. However, in the open market, Sierra Leone cocoa now trades at a heavy discount compared to other West African grades because of the poor quality. In particular, the cocoa from Sierra Leone is discounted because of problems with mould. The DTIS also reported that there is a great deal of misunderstanding in Sierra Leone about the value of cocoa and the responsibility for the discount. The aspiration of exporting at less than 15% mould is rarely achieved with offers well in excess of 30‐40% mould. The problem is perceived either as a lack of understanding by the farmer or as wilful negligence. And the marketing system that has evolved since the war offers no incentive at all to the farmers to take care of the cocoa. Recognising as stated by Sinclair and Walker (1999)2 that what people do and what they know are rather different, farmers’ knowledge cannot be directly inferred from observation of their practice. This study was therefore designed to find out their knowledge (local knowledge) and provide information to PAGE for prioritization of its interventions, as there is clearly no point in promoting an extension message trying to inform farmers about what they already know (Sinclair and Joshi, 1999)3.

1 Sierra Leone, Adding Value to Nature’s Bounty Through Trade; Diagnostic Trade Integration Study, June 2006 2 Sinclair, F. L. and Walker, D. H., (1999). A utilitarian approach to the incorporation of local knowledge in Agroforestry research and extension. In: Agroforestry in sustainable agricultural systems (eds. Buck, L. E., Lasoie, J. P. and Fernandes, E. C. M.). Lewis Publishers, New York, pp. 245‐247. 3 Sinclair, F. L. and Joshi, L. (1999). Taking Local Knowledge about Trees Seriously. In: Forestry, forest users and research: new ways of learning. ETFRN Publications Series, pp. 45‐61.

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2.2: Methodology

The knowledge elicitation strategy used in the study is derived from Dixon et al (2001)4 and is schematically represented in Figure 1. This report focuses on the first three stages – knowledge base development. It is expected that the fourth stage – generalization and preparation of a computerized knowledge base will be the subject of a follow up study.

Objective To refine knowledge acquisition objectives

To generate a broad understanding of domain & define boundaries and terms

To create a coherent and comprehensive knowledge base

To test how representative the knowledge base is of farmers generally

Informants and activities

A broad range of activities across communities

One or two intensive interactions with a small number of purposively selected informants’

Interactive cycle of repeated interaction with stratified sample of key informants, knowledge representation and evaluation of emerging knowledge base

A variety of questionnaire‐based survey approaches on a sufficiently large and randomly selected sample of informants from the community

Figure 1: Four stages in the Knowledge elicitation process

Focus group interviews were the main method used for knowledge elicitation. They were conducted in 10 communities as shown in Table 1. Discussions focused on farmers’ level of knowledge of technology for production and processing, pest and disease management, effectiveness of sources of information, extension systems, and of child labour.

4 Dixon, H. J., Doores, J. W., Joshi, L., and Sinclair, F. L., (2001) Agroecological Knowledge toolkit for Windows: Methodological Guidelines, Computer Software and Manual for AKT5; School of Agricultural and Forestry Sciences, University of Wales, Bangor, U.K.

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Table 1: Location of Focus Group Interviews

District Chiefdom Section Community Number at Start

Crops Discussed

Kailahun Luawa Baoma 16 Cocoa

Luawa Bandajuma 14 Cocoa

Kissi Tongi Pokolie Taidu 14 Coffee, Cocoa

Kissi Teng Toli Kayia 12 Coffee, Cocoa

Kissi Teng Kundu Turado 8 Cocoa

Upper Bambara Korbu Gorama 18 Cocoa

Kenema Nongowa Largo 10 Oil Palm

Nongowa Kagbondo Kamboima Talia 30 Cocoa

Lower Bambara Panguma 12 Oil Palm

Lower Bambara Kamboma 18 Coffee

2.3: Knowledge Among Cocoa Farmers

Establishment of New Plantations In all communities there have been new plantings of cocoa in the last five years. In all except one group participants agreed that over 75% of farmers had established new plantations. In the case where very few new plantings have taken place (kundu) this is because the vegetation in the area has been converted to elephant grassland over the last two decades and new cocoa plantations are destroyed by bush fires or the drought conditions in the grasslands. New plantations were most often established in lowlands because of better soil fertility and reduced risk of drought and moisture stress. Farmers have number of ways of identifying soil that is good for cocoa – land in which seeds of cocoa dispersed by monkeys have germinated and are growing well; land where test plantings of cocoa is doing well; land where sample pits show clayey soil with few granite rocks; thick and rich top soil. Farmers are well aware that plantings in lowlands are more subject to black pod disease. About half of farmers planted the seeds directly; the other half planted seedlings obtained either from nurseries established by the individual farmers or uprooted from old plantations. Seeds were selected from trees in existing plantations that were very productive and from very ripe pods with large number of seeds. Seedlings uprooted from existing plantations had to be fresh and healthy looking.

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For nurseries the seeds are planted in soils collected from dustbins placed in black polythene bags (“mind your business”) with perforations. Seeds are watered once or twice a day. Farmers are well aware that nursed seedlings do better than directly seeded plants (establish faster, are less subject to rodent damage and get to bearing age faster), but nurseries are more time consuming than direct seeding (plants stay usually for about 6 months in nurseries, but can be kept for as long as 12 months depending on when the nursery is set up and the farmer is ready to establish the plantation). Poor looking seedlings are not planted out. The nursery technique now used by farmers is an adaptation of the method taught by the Integrated Agricultural Development Projects (IADP) of the 1970s. Adaptation involves making use of soil from dustbins to compensate for non‐use of fertilisers and use of black polythene bags (“mind your business”) in place of imported plastic nursery bags. The vast majority of new plantations are of the Amazon cocoa variety called Ghana Cocoa. Farmers recognise that it is higher yielding than the traditional West African Amelonado variety called Mende Cocoa (up to double the yield and starts bearing earlier ‐ in 4 years versus 5‐6 years). But a few farmers still plant the Amelonado because it starts to fruit earlier in the harvest season, allowing farmers to harvest and sell cocoa during the “hungry season”. Furthermore, it is reputed to have a longer productive lifespan. Spacing of trees is between 3 to 3.75 meters at random. This spacing is obtained by observation of the spacing on existing plantations that are doing well. Farmers say that the IADPs did not give any specific recommendations on spacing. The spacing is marked out in the field by stepping or striding. Maintenance of New Plantations New plantations are under‐brushed once or twice a year. Farmers almost universally accept that two brushings a year is desirable but about a third of them were only able to underbrush once due to labour shortage. Plantations on lowlands may need an additional brushing until the canopy closes in about 5 years. Harvesting Most new Amazon plantations start bearing fruit in the fourth year while Amelonado plantations start bearing in the fifth or sixth year. All farmers recognise that It is best to harvest very ripe pods as that produces very good cocoa beans but some now harvest pods which have just started to ripen because of the threat of loss of pods from cocoa thieves. Processing Processing of cocoa involves breaking of pods, removal of the beans, fermentation and drying. After harvesting pods are collected in a central point and split open with cutlasses after stacking for zero to 7 days. The pulp is removed by hand and the beans fermented for 2 to 4 days in heaps or in boxes then spread out to dry on clean floors or on concrete drying floors

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where available in a minority of cases. Drying is usually for 1 to 3 days after which the beans are stored in used nylon rice bags and transported to Buying Agents. In Kenema District farmers reported using even more drastic processing methods. They harvest and break the pods the same day, ferment in Nylon rice bags for two days then dry for one or two days. A couple of youths even harvest pods, split them open, remove and place the beans on wooden platforms where they are smoked so that the whole process takes only one day. Universally farmers said that the cocoa produced by the methods above yield much poorer quality cocoa beans than was produced in the SLPMB and James International days i.e. before the civil war. They claimed that there is currently no incentive to produce higher quality cocoa (well fermented and properly dried beans), as they receive no higher price for better quality cocoa, except for farmers registered with BioUnited which only started operation in 2008. In fact they claim that it is a disadvantage to produce better dried cocoa as it weighs less, and so their earnings are reduced! Farmers (old as well as young) described the method for producing what they regarded as Grade 1 cocoa as follows:

• Stacking pods for about 5 days to allow fermentation to start and make pulp removal by hand easier. Beans can be washed to remove pulp as required by BioUnited a new company that has entered the cocoa market and is trading in organic cocoa.

• Fermentation for about 7 days in fermentation boxes or baskets lined and covered with banana leaves in two stages: 3‐4 days in the first instance, then draining the water, mixing the beans and fermenting for another 3‐4 days

• Drying on concrete floors, raffia mats or very clean well swept floors with hard surfaces, for about 7 days

• Bagging in Jute bags not polythene rice bags which makes stored cocoa beans sweat

So, all farmers who participated in the Focus Group discussions (young and old) have full knowledge of how to produce good quality cocoa but are not doing so, except for Bio United farmers around Pendembu who produced and sold Grade 1 cocoa in 20085. Generally it appears that a price differential of Le 500 per pound would be sufficient to get a significant number of farmers to produce Grade 1 cocoa. The quantities offered for sale would be increased further if farmers received cash loans during the rainy (hungry) season at competitive interest rates that would allow them to finance urgent family needs and under‐brushing of plantations so reducing their dependence on credit from the Buying Agents and local traders which are at very high interest rates and are collected in the form of cocoa at harvest.

5 A couple of coops in Kenema and Kono assisted by WVSL apparently also exported Grade 1 organic cocoa in 2008

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Tackling the Most Important Constraints Farmers universally identified the most important factor that affects the productivity of their cocoa plantations as the degree of under‐brushing. Obtaining labour for under‐brushing is their most important constraint. The second most important constraint indentified was black pod disease followed by losses to pests especially monkeys. Farmers indicated that the most effective method of controlling damage from monkeys is to cull them but are unable to do so now because of the confiscation of their weapons as part of the disarmament programme. One community succeeded in getting the security forces to conduct a cull of bush cows for them and would like the armed forces to do the same for monkeys. In contrast to control measures for monkeys, farmers have little or no knowledge of any local method of control for black pod disease, except for chemical spraying carried out by State agents during SLPMB days. There is very little knowledge of successful shade management. In the few cases farmers reported to have tried it recently the results were a disaster – apparently due to too much shade removal. Access to Extension Services Apart from advice from Bio United, farmers have no knowledge of any extension activity on cocoa farming. 2.4: Knowledge among Coffee Farmers

Establishment of New Plantations In contrast to cocoa there have been much fewer new plantings of coffee. None of the farmers on Kailahun have established new plantations in the last five years, while under 50% have done so in Kenema District. This is because of the unfavourable price of coffee. However, with the price increase the last two years more farmers have under‐brushed and harvested their old plantations. Seedlings for new plantations are mostly obtained by selecting healthy looking seedlings that have germinated under productive plants. Most of the plantings are of “white coffee” which reaches bearing age as early as 3 years when well looked after and reportedly yields double the “red” coffee which can take up to 6 years to bear fruit. Use of nurseries to raise coffee seedlings is very rare – only one farmer, a former Ministry of Agriculture worker was found using it. He plants seeds in a seed bed by the river, waters and weeds regularly. It takes him 2 years to produce the seedlings. He uses the method as he is sure of getting good seedlings to plant.

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Spacing used for coffee ranges between 2 to 3 metres and is measured by 3 strides, but can be as low as 1.5 metres in which case thinning takes place to get the preferred spacing of 3 metres. Maintenance of New Plantations Maintenance of new plantations consists of under‐brushing one to three times a year. Half of the farmers are only able to under‐brush once although they are fully aware that three brushings are best. Harvesting Coffee beans are harvested when ripe. To reduce contamination farmers sometimes spread a mat or cloth under the trees to collect fruits that drop off the trees Processing Most often harvested beans are piled for about 1 week to ferment, dried on rocks or in rare cases on cement drying floors for up to 21 days, then hulled by hand pounding in mortars and bagged for sale. Farmers sometimes dry coffee beans on clean swept ground or on roadsides when they do not have access to enough rock face to dry their produce. Drying takes longer in such cases – up to 1 month and they recognise that such practice may cause contamination with grits and sand. Coffee is also occasionally dried on plastic sheets when drying takes 7 – 14 days. A number of youths report that they reduce drying time further to as little as 3‐4 days by pounding the fresh beans before drying. The shorter processing methods produce lighter coloured grains but there is no reported difference in price received by farmers employing the different processing methods. Farmers employ the different methods according to the time they can wait between harvest and sale of their coffee. Coffee husk is usually pounded and used to make a drink for home use. Tackling the Most Important Constraints As in the case of cocoa, farmers universally identified under‐brushing as the most important constraint in coffee farming. Insect problems especially termite and borer attacks was the second most important constraint. Farmers have no knowledge of local methods of controlling the insects. Access to Extension Services Farmers have no knowledge of any current extension activity on coffee farming.

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2.5: Knowledge among Oil Palm Farmers

Establishment of New Plantations Over 50 percent of farmers in the focus groups have established new oil palm plantations in the past five years. They are most often established as an intercrop with upland rice or in the year following a rice crop when they are either interplanted with groundnuts or planted sole. Seedlings were purchased from German Agro in Bo in a minority of cases, uprooted under productive trees in existing plantations at the 1 – 6 leaf stage, or obtained from nurseries established individually by farmers. Nursery practice involves either (a) obtaining seeds from the ground under productive trees in existing plantations and planting them in sand beds to germinate in about 3 months then allowing them to grow for another 2 months before being transplanted or (b) use of germinated seeds obtained from the base of ripe fruit bunches which are then sowed either in sand beds or in black plastic bags (“mind your business”) filled with dustbin soil. Seedlings in beds are ready for transplanting in 6 – 8 months while those in beds usually take about 1 year. Oil palm trees are planted in rows usually between 7.5 and 9 metres apart measured out by a few farmers with tape measures but by most by striding (about 10 strides). Knowledge of this spacing comes from observation of plantations establish over the last 30 years under the supervision of extension agents. Farmers agree that plantations established using the second nursery method reach bearing age faster than those established using the first method – 4 versus 5 or 6 years for the first nursery method and over 6 years for plantations established with uprooted seedlings from existing plantations. The latter two methods are used because they are less labour demanding and require less time between collection of seeds and establishment of the plantation. Maintenance of New Plantations Transplanted seedlings are protected from rodents by collars made from old containers such as “shine pans” and buckets with their bottoms knocked out as wire mesh collars are expensive and difficult to obtain. Most farmers continue to intercrop the new plantations with annual crops such as groundnuts and cassava to keep weeds down, with under‐brushing usually once a year. All farmers prune their plants periodically to remove unwanted fronds. Harvesting and Processing In the old days farmers did not process palm oil for commercial sale. All sales were of palm bunches to the Pioneer Oil mills. Now all processing is by the traditional method which

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involves separating fruit from bunches by halving or quartering the bunches, then knocking out the fruits. The fruits are then pounded in mortars to separate the fleshy part of the fruit between the outer shell and the kernel. The mash is boiled and the oil separated by treading in a pit with the addition of some water so as to be able to scrim off the resulting oil. Farmers reported that the traditional method is very laborious, especially the treading of mash. This is becoming a major problem for plantation owners as youths are reluctant to undertake the activity – in one community interviewees reported that youths in the family disappear as soon as they see that fruits are being boiled for processing, and very expensive hired labour has to be used. Also the process is very wasteful because of high oil losses from newly dug oil processing pits. None of the farmers have any knowledge of small scale oil processing equipment such as digesters and screw presses. About 10 – 30% of the palm kernels produced is processed into palm kernel oil for home consumption. There is no longer any commercial market for palm kernels in Kenema District6. Tackling the Most Important Constraints As in the case of cocoa and coffee, oil palm farmers universally identified under‐brushing as the most important constraint in oil palm farming. The cost of harvesting old and tall palm trees (farmers usually have to give the harvesters half of the harvested bunches as payment), and the laborious traditional oil extraction process, were identified as close second. Access to Extension Services Farmers have no knowledge of any current extension activity in oil palm farming. 2.6: Conclusions

The KAP study revealed that contrary to the assumption by development agencies, farmers have not lost the knowledge of how to process and produce good quality cocoa. They are not currently doing so because they have no incentive to produce the better quality. In fact the incentive is to produce poorer quality as they earn a higher income from relatively wet cocoa beans which weigh more than the dry beans. Indications are that a price differential of Le 1000 ‐ Le 1500 per Kg would be sufficient inducement for farmers to produce Grade 1 cocoa. The most important constraint faced by farmers is the cost of obtaining hired labour for the under‐brushing activity. Credit schemes that provide seasonal loans for the activity would significantly improve farmer’s capability to increase tree crop output from existing farms.

6 As shown in Chapter V, the Marika oil processing plant in Freetown is the only commercial purchaser of palm kernels currently in Sierra Leone and it obtains most of its supplies from the Northern Province.

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CHAPTER 3. CHILD LABOUR STUDY 3.1: Objectives

The specific objective of the Child labour Study was to quantify the incidence and nature of child labour in the tree crop farming systems. It was decided to include child labour in the study because of the recent concern in the international community with the issue in cocoa farming in West Africa. Concerns were raised following negative media reports about the possible use of injurious child labour in cocoa production, particularly in the West African sub‐region. Senator Tom Harkin and Representative Elliot Engel both of the United States Legislature were among those who raised these concerns, and further threatened to bring up legislation for the boycott of cocoa from countries found to be indulging in Worst Forms of Child Labour (WFCL) and Forced Adult Labour (FAL). These concerns prompted a series of discussions between representatives of the cocoa industry and a number of trade union, consumer and nongovernmental organizations on the incidence and nature of WFCL and FAL, culminating in the elaboration of a strategy to deal with the problem. This strategy was codified in the “Harkin‐Engel Protocol”, an agreement to eliminate the worst forms of child labour (as described in ILO Convention No.182) from the cocoa and chocolate sector, signed by representatives of the major stakeholders in September 2001 A study conducted in four West African countries (Cameroon, Cote d’Ivoire, Ghana, and Nigeria) by the International Institute of Tropical Agriculture (IITA)7 in 2002 estimated that there were about 284,000 child labourers working in hazardous conditions on cocoa farms, of which 200,000 of the number were based in Cote d’Ivoire and Nigeria. 3.2: What is Child Labour?

The United Nations Convention on the Rights of the Child, ILO Convention 138, and 182, and the Sierra Leone Child Rights Act of 2007 define child labour. According to the ILO,8 child labour refers to work that (i) is mentally, physically, socially and morally dangerous and harmful to children; and (ii) interferes with their schooling by depriving them of the opportunity to attend school, by obliging them to leave school prematurely, or by requiring them to attempt to combine school attendance with excessively long and heavy work. The worst forms of child labour (WFCL) is defined (by ILO Convention 182) to include all forms of slavery or practices similar to slavery (the sale and trafficking of children, debt bondage and serfdom, forced or compulsory labour including recruitment for use in armed conflict); the

7 International Institute of Tropical Agriculture (IITA). 2002. Child Labour in the Cocoa Sector of West Africa. IITA, Ibadan, Nigeria. 8 International Labour Organization (ILO) (2002). Eliminating the Worst Forms of Child Labour: A Practical Guide to ILO Convention No. 182. Handbook for Parliamentarians No. 3, 2002. ILO, Geneva

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use or offering of a child for prostitution and/or pornography, illicit activities including the production and trafficking of drugs; as well as work which when performed is likely to harm the health, safety or morals of the child (as determined by national authorities). These issues have been incorporated into Sierra Leone Law. Sections 32 and 125 – 128 of the 2007 Child Rights Act states as follows: Section 32: (1) No person shall subject a child to exploitative labour as defined in

subsection (2). (2) Labour is exploitative of a child, if it deprives the child of its health, education or development

Section 125: The age of fifteen shall be the age at which the compulsory primary

education of a child shall end, and also the minimum age for the engagement of a child in full‐time employment.

Section 126: (1) No person shall employ a child in night work.

(2) Night work constitutes work between the hours of eight o’clock in the evening and six o’clock in the morning.

Section 127: (1) The minimum age for the engagement of a child in light work shall be

thirteen years. (2) Light work constitutes work which is not likely to be harmful to the health or development of the child and does not affect the child’s attendance at school or the capacity of the child to benefit from school work.

Section 128: (1) The minimum age for the engagement of a person in hazardous work is

eighteen years. (2) Work is hazardous when it poses a danger to the health, safety or morals of a person. (3) Hazardous work includes–

(a) going to sea; (b) mining and quarrying; (c) porterage of heavy loads; (d) manufacturing industries where chemicals are produced or used; (e) work in places where machines are used; and (f) work in places such as bars, hotels and places of entertainment where a person may be exposed to immoral behaviour.

It is essential to stress while considering child labour issues within the African context that not all work by children is child labour. The ILO elaborates and clarifies that child labour is not the participation of a child in work that does not affect his/her health and personal development, or interferes with his/her schooling. Such work “includes activities such as helping their parents care for the home and the family, assisting in a family business or earning pocket money outside school hours and during school holidays”. It includes also work that “contributes to children’s development and to the welfare of their families;

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provides them with skills, attitudes and experience, and helps to prepare them to be useful and productive members of society during their adult life” (ILO, 2002). The critical issue is what to define as injurious or strenuous work in tree crop farming. A recent study in Ghana9 identified the following cocoa farming activities as likely to be hazardous for children:

• Carting fermented beans • Carting dry beans for sale • Pod plucking (harvesting) • Application of fertiliser • Application of fungicides and other chemicals • Spraying insecticides • Land clearing • Felling trees • Bush burning

The activities identified above were evaluated as hazardous because of the increased inherent risk of these activities to harm the health of children. The potential for harm (hazard) from these activities include exposing these children to carrying or lifting heavy loads, exposing them to sharp farming implements such as the cutlass and dangerous harvesting tools such as the long harvesting hooks, or exposure to chemicals (pesticides or fertilisers) or extremely laborious conditions of work. Burning of bush also could lead to inhalation of smoke and the risk of burns. 3.3. Methodology

Quantitative data for this study was obtained from the demographics section of the household survey questionnaire described in Chapter 4, and qualitative data during Focus Group Interviews for the KAP study described in Chapter 2 of this report. As described earlier heads of households were interviewed during the household survey. The information on the work of children in the households was therefore provided by the head of household. The database of children enumerated contains 1775 children. For this study they have been grouped into four categories using the ages for different types of child work stated in the Child Rights Act as follows:

• Infants: 0 ‐ 5 years • Small Children: 6 – 12 years • Older Children: 13 – 14 years (can be engaged in light work) • Youths: 15 – 17 (can be engaged in full‐time employment)

9 Ministry of Manpower, Youth & Employment, (MMYE); Labour practices in cocoa production in Ghana (pilot survey); National Programme for the Elimination of Worst Forms of Child Labour in Cocoa April 2007

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3.4. Child Work in Cocoa Farming

Figures 2‐5 show the proportion of different groups of children that participate in the different cocoa farming activities. As is to be expected less than 8 percent of infants take part in any cocoa farming activities – most likely the 5 year olds and they participate mainly in splitting cocoa pods and head loading (Figure 2). Using the Ghana definition of hazardous work 3–4 percent of infants are engaged in such work – pod splitting, with the highest percentage among infants in Kenema District.

Participation rates rise significantly among older age groups and the range of activities in which the children work expands. Rates of participation are highest in Kailahun where cocoa is the predominant cash crop. Among all age groups and in all Districts splitting of pods is the activity with the highest participation rates, followed by head loading of pods from farms to processing points and dried cocoa to the home ready for sale.

It is interesting to note that the rate of participation in clearing and brushing of cocoa plantations is much lower than that for the harvesting and post harvest activities. This is clearly because of the more taxing nature of under brushing. Only among the youths in Kailahun does the rate rise above 30% (Figure 5). Because of the use of machetes in this activity it is usually classed as a hazardous activity for children.

Figure 2: Participation of Infants (0‐5Years) In Cocoa Family Farm Activities

Figure 3: Participation of Children (6‐12 Years) in Cocoa Family Farm Activities

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Comparing the figures for Sierra Leone with those reported for Ghana10 in Table 2 shows that child work rates in harvesting and post harvest activities are similar, but are slightly higher in Sierra Leone in the pre‐planting activities (brushing etc). Of course the very hazardous activities of fertiliser application and spraying of chemicals do not occur in Sierra Leone.

10 Note that in the Ghana study the sample of children were interviewed directly, a more intensive technique than that used in this study, thus providing much more detailed and precise data for Ghana.

Figure 4: Participation of Children (13‐14 Years) in Cocoa Family Farm Activities

Figure 5: Participation of Youths (15‐17 Years) in Cocoa Family Farm Activities

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Table 2: Number of Children in Sample, and percentage participating in Cocoa Farming Activities in Ghana

Cocoa Activity Age Group (Years) 5‐12 13‐14 15‐17 Pre‐Planting Land clearing 2 (0.7%) 8 (5.3%) 16 (12.4%) Felling trees 3 (1.0%) 6 (4.0%) 12 (9.2%)

Burning 9 (3.1%) 20 (13.2) 19 (14.6%) De‐stumping 8 (2.8%) 15 (9.9%) 17 (13.0%) Peg cutting 6 (2.1%) 8 (5.3%) 8 (6.1%) Lining/pegging 9 (3.1%) 11 (7.3%) 9 (6.9%) Planting Holing/planting of suckers (shade plants) 41 (14.2%) 44 (29.3%) 46 (35.1%)*

Prep. Seedlings 13 (4.5%) 7 (4.7%) 14 (10.7%) Carrying seedling 13 (4.5%) 12 (8.0%) 16 (12.1%) Holing for seedlings 13 (4.5%) 10 (6.7%) 18 (13.7%) Planting of seedlings 11 (3.8%) 14 (9.3%) 20 (15.3%) Sowing at stake 53 (18.4%) 40 (26.5%) 48 (36.9%)* Farm Maintenance Weeding (farm maintenance) 151 (51.2%)* 105 (68.6%)* 100 (75.8%)*

Spraying insecticide 5 (1.7%) 6 (3.9%) 16 (12.0%) Application of fertiliser 15 (5.1%) 8 (5.2%) 21 (15.8%) Application of fungicide/other chemical 8 (2.7%) 7 (4.6%) 18 (13.7%)

Water carrying for spraying 184 (62.4%)* 113 (73.9%)* 97 (73.5%)*

Sanitation/pruning 16 (5.4%) 24 (15.7%) 45 (33.8%) Mistletoe control 25 (8.4%) 21 (13.7%) 44 (33.1%) Harvesting Pod plucking 60 (20.3%) 55 (35.9%) 71 (53.4%) Pod gathering /heaping 271 (90.9%)* 137 (89.5%)* 113 (84.3%)* Pod breaking/fermentation 104 (35.3%)* 73 (47.7%)* 83 (62.4%)*

Bean scooping 176 (59.1%)* 91 (59.5%)* 87 (65.9%)* Post‐Harvest Carting fermented bean 151 (50.7%)* 107 (70.4%)* 99 (75.0%)* Drying beans 89 (29.8%) 76 (50.0%)* 85 (64.4%)* Carting dried beans for sale 65 (21.8%) 65 (43.0%)* 76 (57.6%)*

Notes: Percentages in asterisk (*) are participation rates above 30 percent within age groupings Source: MMYE, 2007, Table 6.32

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A question that arises immediately, given the high participation rates of children in the family cocoa farm is whether the work is affecting their education – a factor which would be considered as causing such work to be classed as injurious to the welfare of the children. As shown in Figures 6 and 7 the proportion of school going age children in the sample for the study (households with one or more of the tree crops) that are in

school is very high, even in the traditionally educationally deprived Kailahun District. This is especially true for the 6‐12 years old group who have 93% attendance in Kailahun and a low of 81% in Kono. In the other age groups total participation in school is around 88% in the 13‐14 years group and between 80% and 86% in the 15‐17 years group. On the surface it would appear that work in agriculture is not preventing children from enrolling in school.

But what effect does farm work have on school attendance? In Focus Group Interviews conducted in cocoa farming communities in the KAP study all groups reported that they hired gangs of youths less than 18 years of age to work on their farms. Such youth groups undertake all farm work including under‐brushing. However, farmers indicated that accidents with cutlasses were no more frequent than among adults as youths were quite skilled in the use of the equipment. Also, farm work had no adverse effect on the education of the youths as school‐going children only worked at weekends and during school holidays.

Figure 6: Children in Primary School

Figure 7: Children in Secondary School

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3.5. Child Work in Coffee Farming

Figures 8 ‐ 11 show that the pattern and extent of child work in coffee farming is similar to that on cocoa farms, although participation rates overall are about 10 percentage points lower in coffee farming compared to cocoa. This is probably due to the lower level of activity in coffee farming compared to cocoa because of the relatively better export price for cocoa over the past

decade. As in the case of cocoa, children and youths participate more in harvesting and post harvest activities than in production activities. In the absence of pods to split open, head‐loading becomes the activity in which the highest proportion of children participate Children also participate more in their family coffee farms in Kailahun and Kono than in cosmopolitan Kenema.

During the Focus group interviews for the KAP Study, farmers confirmed that their pattern of use of hired youth groups in coffee farming was the same as in cocoa farming.

Figure 8: Participation of Infants (0‐5Years) In Coffee Family Farm Activities

Figure 9: Participation of Children (6‐12 Years) in Coffee Family Farm Activities

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3.6. Child Work in Oil Palm Farming

Figures 12 ‐ 14 illustrate the child work situation in the oil palm plantation sector in the Eastern Province. Participation of infants in oil palm farming activities was virtually zero. Overall children participate much less in oil palm activities than in cocoa or coffee farming. Participation rates are highest in Kenema. This is clearly a reflection of the fact that particularly cocoa farming is much less intensive in Kenema, and farm sizes are smaller.

It is also important to observe the extremely low participation rates in the splitting of palm fruit bunches in preparation for extraction of palm oil, and in harvesting of fruit bunches. These are very hazardous activities, the latter because of the thorns on the fruit bunches and the latter because of the need to climb the tall palm trees.

Figure 11: Participation of Children (13‐14 Years) in Coffee Family Farm Activities

Figure 10: Participation of Youths (15‐17 Years) in Coffee Family Farm Activities

Figure 12: Participation of Children (6‐12 Years) in Oil Palm Family Farm Activities

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It is evident therefore evident that parents are mindful of the dangers to which they expose their children in farm activities. The non participation of children in hazardous oil palm cultivation activities was confirmed during the KAP study Focus Group interviews. The same situation in the hiring of youth groups as for cocoa was reported by all oil palm groups interviewed except that youths

are not hired for harvesting as they do not have the skill to safely climb and harvest the tall trees.

3.7. Conclusions

This study shows that children work on tree crop farms at similar levels and over the same range of activities as found on Ghanaian cocoa farms, except that without the use of fertilisers and agro chemicals on Sierra Leone farms, children in this country are not exposed to the hazards of application of chemicals, and children under 15 years are not engaged in particularly hazardous tasks such as harvesting and splitting of palm fruit bunches. Using the definition of the ILO that child labour refers to work that is mentally, physically, socially and morally dangerous and harmful to children; and interferes with their schooling

Figure 14: Participation of Children (13‐14 Years) in Oil Palm Family Farm Activities

Figure 13: Participation of Youths (15‐17 Years) in Oil Palm Family Farm Activities

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by depriving them of the opportunity to attend school; as well as the definitions in the Sierra Leone Child Rights Act, the conclusion from this study is that child labour does not exist to any noticeable extent in tree crops farms in Sierra Leone. Furthermore, it very important to note that the work of children is on their parents’ farms and that there is clear evidence that parents and guardians take care not to expose the children to very hazardous work. There is no evidence from this study of slavery in tree crop farming in Sierra Leone – there is no bonded, forced or compulsory labour. However there are a number of unanswered questions on child labour that the study has not addressed because of its limited nature and scope. These include:

• How hazardous is the use of machetes and knives by children – what is the rate of injury compared to injuries suffered by adults?

• Are loads carried by children too heavy for them? – head loading in itself is not hazardous if loads are comfortable for the carrier

• What is the effect of farm work on daily attendance at school affected and does it affect home study time?

• What is the exposure of the children to violence or abusive conduct when they work on the tree crop farms, e.g. are they forced to work when they are sick?

It is highly recommended that a work study be undertaken covering the above issues among others in which the children are the direct respondents

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CHAPTER 4. PRODUCTION COSTS AND RETURNS

4.1 Methodology

The national household survey in 2004 indicated` that about 28% of households in the Eastern region have cocoa farms, 21% have coffee farms and 10% have oil palm plantations.11 The sample of farmers for the study of tree crop production cost was restricted to the PAGE target area consisting of five chiefdoms in Kailahun District (Kissi Kama, Kissi Tongi, Kissi Teng, Luawa and Yawei), two chiefdoms in Kenema District (Nongowa and Lower Bambara) and five chiefdoms in Kono District (Fiama, Gbane, Sandor, Tankoro and Gbense).

About ten households were selected for study from three localities in each chiefdom ‐ located at the chiefdom headquarters town, a village near and another far from the headquarters town, making a total of 30 households from each selected chiefdom.

A household farm production questionnaire was designed in consultation with WVSL and administered to each selected household to collect input and output data on cocoa, coffee and oil palm plantations production, including direct measurement of crop area using GPS equipment a unique feature of this survey (Annex 1). A total of about 360 household questionnaires were administered.

4.2: Cocoa Production

Table 3 shows that the lowest proportion of tree crop farmers sampled that owned cocoa plantations was in Kenema (50%) with virtually all tree crop farmers in Kailahun having cocoa farms. The average size of cocoa plantations owned by small farmers’ ranged between 2.7 ha in Kenema and 3.3 ha in Kono. Over half of the cocoa farmers in Kailahun planted seedlings with lower proportions in the other two districts. Fertiliser use was virtually nonexistent – the 2% of farmers who applied fertiliser in Kailahun and Kenema used it in nurseries. Pesticides are not used and only a small proportion of farmers in Kailahun paid some form of rent for the plantations they were exploiting – usually a gift to other family members for use of plantations inherited from parents. Table 4 shows the extent of use of hired labour in export tree crop production. The highest use is in the most labour demanding activity clearly identified during the KAP survey – the under brushing of the farms with between 52% and 93% of cocoa farmers hiring labour for the activity. Average hired labour use for under brushing of cocoa farms ranged from a low of 13 person days per ha in Kenema to 32 person days per ha in Kailahun for farmers hiring labour. The Table also shows that wage rates were highest for the activity in Kailahun (Le 6,050 per person per day) where the task is most demanding because of the dense vegetation cover. 11 Statistics Sierra Leone (2007), Sierra Leone Integrated Household Survey, 2003/04: Final Statistical Report

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Table 3: Age and Size of Plantations, Proportion of Farmers Using Inputs (percent) and Average Quantities Used by Farmers Using the Input in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season

District Sample Size Age of Trees Area Seeds Seedlings Fertiliser Pesticides Land Rent

Years Ha No/Ha No/Ha Kg/ha Le/Ha Le/Ha

Kailahun 169 Average 28 3.1 445 329 11 0 n.a. % Using 93.9 16 56 2 0 16 Kenema 27 Average 24 2.7 102 111 1 0 n.a. % Using 50.0 17 24 2 0 2 Kono 96 Average 28 3.3 88 225 0 0 n.a. % Using 81.4 8 25 0 0 0

Source: EDS Field Survey Table 4 Proportion of Farmers Using Hired Labour (percent), Quantities Used by Farmers Using Hired Labour (person days per hectare) and Average Wage Rates (Leones per person per day) in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season

District Land Clear Underbrush Planting Pruning Spraying Harvest Pods Trans pods Break Pods Ferment

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Kailahun Average 5,045 11 6,050 32 4,811 6 5,900 4 5,000 2 5,828 5 4,944 6 5,079 6 4,800 4 % Using 39 93 33 8 1 38 33 27 5 Kenema Average 4,882 16 4,696 13 2,000 15 0 0 0 0 5,750 14 4,500 12 4,000 17 0 % Using 31 52 2 0 0 7 7 7 0 Kono Average 3,650 8 4,479 15 3,688 5 5,500 10 0 0 4,162 8 4,429 6 4,350 7 5,500 6 % Using 16 79 6 3 0 31 18 17 2

Source: EDS Field Survey

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Comparing the figures in Table 5 with those in Table 4 shows that the quantity of family labour used in cocoa production is less than the amounts of hired labour in all activities except in harvesting and post harvest activities where roughly equal amounts of hired and family labour are used. Costs and returns for cocoa production in the three Districts are shown in Table 6. Net returns are 5 ‐ 6 times higher in Kenema than in Kailahun or Kono. This is because of the much higher yields obtained in Kenema compared to the other two Districts. It appears that those farmers who have rehabilitated their cocoa farms have maintained them better than farmers in the other district or that the agro‐ecological conditions in Kenema District are better suited for cocoa, since the average age of the trees is not very different (24 years in Kenema and 28 years in Kailahun and Kono), neither is the variety mix very different. The average yields are less than the average of 400 Kg per ha normally assumed for Sierra Leone cocoa before the civil war and significantly less than the potential yield of 1‐1.5 mt/hectare with the new hybrid varieties grown in Ghana and Côte d’Ivoire. It is clear that there is much scope for increasing on farm cocoa yields and returns in Sierra Leone by the adoption of improved varieties and cultural practices. 4.3. Coffee Production

The figures in Table 7 show that on the average coffee plantations were about four years younger in Kenema than in the other two districts (24 versus 27 year old trees) i.e. coffee plantations in Sierra Leone averaged about half of the expected life of 50 years. The average size of coffee plantations was only slightly less than those for cocoa and ranged between 2.4 ha in Kailahun to 2.9 ha in Kenema. These acreages are substantially greater than the 0.25 ha per household normally assumed for the country.12 As for cocoa, over half of the coffee farmers in Kailahun planted seedlings with lower proportions in the other two districts. Fertiliser and pesticide use was nonexistent and as in the case of cocoa only a very small proportion of farmers in Kailahun paid some form of rent for the plantations they were exploiting. Table 8 shows the extent of use of hired labour in coffee production. As in the case of cocoa, the highest use is in the most labour demanding activity clearly identified during the KAP survey – the under brushing of the farms with between 80% and 98% of cocoa farmers hiring labour for the activity. Average hired labour use for under brushing of coffee farms was between 14 and 17 person days per hectare and wage rates were the highest for the activity Figure 9 shows that family labour use was lower in coffee than in Cocoa production particularly in Kenema where family labour was used mainly to supervise that work of hired labourers. As for cocoa, net returns in coffee production (Table 10) are significantly higher in Kenema.

12 See for example Jean Paul Rousseau (2009), Review of production and processing of coffee, oil palm and jatropha – Mission Stabex.

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Table 5 Use of Family Labour in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season

Land Clear

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Planting Pruning Spraying Harvest Pods

Transport pods

Break Pods

Ferment

PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha

Kailahun Average 1 9 4 3 2 7 7 6 6 % Using 43 88 74 47 2 93 93 94 93 Kenema Average 2 2 2 1 2 3 3 3 3 % Using 31 52 43 39 4 54 54 52 52 Kono Average 3 7 3 9 0 8 7 6 6 % Using 14 70 24 32 0 79 80 78 76


Table 6: Cost and Returns in Small Farm Cocoa Plantations in Sierra Leone, 2008 Crop Season

Hired Labour Family Labour

Yield Sale Price in Village

Output Value

Returns to Family Labour

PD/Ha Le/Ha PD/Ha Kg/Ha Le/Kg Le/Ha Le/Ha Le/PD

Kailahun Average 44 191,983 38 183 2,658 487,296 295,313 7,705 Kenema Average 27 131,291 17 321 2,731 876,750 745,460 44,092 Kono Average 22 100,678 36 186 2,334 434,787 334,108 9,225


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Table 7: Age and Size of Plantations, Proportion of Farmers Using Inputs (percent) and Average Quantities Used by Farmers Using the Input in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season

District Sample size Age of Trees Area Seeds Seedlings Fertiliser Pesticides Land Rent


Kailahun 95 Average 26.7 2.4 84 668 0 0 n.a. % Using 48.5 2.1 69.5 0 0 3.2 Kenema 17 Average 23.3 2.9 69 351 0 0 n.a. % Using 8.7 17.6 35.3 0 0 0 Kono 84 Average 27.1 2.7 123 293 0 0 n.a. % Using 42.9 2.4 20.2 0 0 0

Source: EDS Field Survey Table 8: Proportion of Farmers Using Hired Labour (percent), Quantities Used by Farmers Using Hired Labour (person days per hectare) and Average Wage Rates (Leones per person per day) in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season

District Land Clear Underbrush Planting Pruning Harvest Beans Trans Beans Dry Beans

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Kailahun Average 4,862 13 6,189 14 4,779 7 5,344 4 4,904 7 4,000 4 5,000 2 % Using 47.4 87.4 32.6 11.6 31.6 15.8 5.3 Kenema Average 4,857 11 4,857 14 0 4,000 5 4,000 10 3,000 8 0 0 % Using 41.2 82.4 0.0 5.9 5.9 11.8 0.0 Kono Average 2,727 8 4,324 17 2,667 6 4,250 12 3,694 13 3,875 10 5,520 2 % Using 13.1 98.8 7.1 4.8 42.9 9.5 1.2


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Table 9: Use of Family Labour in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season

District Land Clear

Under brushing

Planting Pruning Harvest Beans

Transport Beans

Dry Beans

PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha

Kailahun Average 1 3 2 2 8 8 % Using 52.6 85.3 65.3 55.8 92.6 89.5 Kenema Average 1 1 1 1 2 3 % Using 35.3 82.4 41.2 47.1 76.5 82.4 Kono Average 1 9 3 11 12 10 % Using 15.5 90.5 23.8 45.2 97.6 90.5


Table 10: Cost and Returns in Small Farm Coffee Plantations in Sierra Leone, 2008 Crop Season

District Hired Labour Family Labour

Yield Sale Price Output Value


PD/Ha Le/Ha PD/Ha Kg/Ha Le/Kg Le/Ha Le/Ha Le/PD

Kailahun Average 27 143,040 22 112 2,996 355,552 212,512 9,659Kenema Average 21 100,006 8 245 3,887 952,315 852,307 106,538 Kono Average 26 107,617 34 159 2,876 457,284 349,667 10,284


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This is also because of the much higher yields those obtained in Kenema – at least double those obtained in the other two districts, and the higher price obtained for the produce reflecting the fact that the farmers sampled were much closer to the regional buying Center hub (Kenema) than farmers in the other districts . Although quite low compared to the average of 400 – 600 kg per ha projected for rehabilitated coffee farms and 800 Kg per ha from new plantations, they are much higher than the previously reported average of 40 Kg/ha for coffee in Sierra Leone.13 As for cocoa, coffee farmers earned a reasonable return from their existing plantations, especially in Kenema District. However, it is clear also clear as for cocoa that there is much scope for increasing on farm coffee yields and returns in Sierra Leone by the adoption of improved varieties and cultural practices. 4.4 Oil Palm Production

Tables 11 – 14 show that the patterns of resource use and returns in oil palm production are similar to those for cocoa and coffee with a couple of very notable difference as follows:

1. Small farmers’ oil palm plantations are much younger in age than cocoa and coffee plantations – around 12 years except in Kenema where the average is driven up by a couple of old plantations. Most oil palm plantations in the Eastern Region have been established after the end of the civil war in Sierra Leone.

2. The cost of production is driven up by the substantial use of hired labour especially in Kenema and the lower palm oil yields obtained14 resulting in average negative net returns to family labour – the only case where returns have been less than the going wage rate among all the crops and districts examined. The fact that the reported average palm oil yield in Kenema increases from 26 gals/ha to 36 gals/ha and the net returns per person day of family labour increases from an negative of Le 14,657 to a positive Le 577 when the two largest oil palm plantations (16.3ha and 13.2ha) are removed from the analysis (Table 15), clearly illustrates the difficulties faced by relatively large scale farmers in managing the large hired labour pool they need to engage and pay partly in oil palm bunches harvested.

13 European Union, 2009: Sierra Leone: Export Commodities Promotion Studies, Main Report 14 Low yields are partly due to the fact that hired labourers are partly paid in harvested produce which farmers do not regards as part of their output.

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Table 11: Age and Size of Plantations, Proportion of Farmers Using Inputs (percent) and Average Quantities Used by Farmers Using the Input in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season

District Sample size Age of Trees Area Seeds Seedlings Fertiliser Pesticides Land Rent


Kailahun 54 Average 13.5 1.8 33 178 10.0 0 n.a. % Using 3.7 72.2 5.6 11.1 Kenema 21 Average 19.5 3.9 0 94 0.0 0 n.a. % Using 0.0 66.7 0.0 9.5 Kono 14 Average 12.3 2.3 0 66 0.0 0 n.a. % Using 0.0 21.4 0.0 0.0

Source: EDS Field Survey Table 12: Proportion of Farmers Using Hired Labour (percent), Quantities Used by Farmers Using Hired Labour (person days per hectare) and Average Wage Rates (Leones per person per day) in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season

District Land Clear Underbrush Planting Pruning Harvest Bunches

Trans Bunches

Split Bunches Process Oil

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Le/PD PD/Ha

Kailahun Average 5,800 14 7,410 18 5,375 8 6,361 13 7,967 11.3 6,286 7 4,917 6 5,750 9 % Using 27.8 79.6 14.8 33.3 33.3 16.7 14.8 11.1Kenema Average 5,000 16 5,075 17 6,250 6 5,701 8 5,786 70.6 4,500 24 6,250 27 6,000 22 % Using 38.1 95.2 19.0 47.6 33.3 23.8 19.0 19.0Kono Average 5,000 13 4,923 27 10,000 1 5,000 26 5,500 40.3 3,000 6 10,000 17 % Using 7.1 92.9 7.1 7.1 28.6 0.0 7.1 14.3Source: EDS Field Survey

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Table 13: Use of Family Labour in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season

Land Clear

Under brushing

Planting Pruning Harvest Bunches

Transport Bunches

Split Bunches

Process Oil

PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha PD/Ha

Kailahun Average 1 8 5 5 4 10 5 10 % Using 33.3 75.9 68.5 48.1 20.4 68.5 59.3 63.0 Kenema Average 1 1 1 1 0 2 2 3 % Using 38.1 90.5 52.4 76.2 0.0 95.2 85.7 95.2 Kono Average 0 16 5 10 9 14 10 13 % Using 0.0 92.9 21.4 85.7 14.3 78.6 78.6 71.4


Table 14: Cost and Returns in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season

Hired Labour Family Labour

Oil Yield

Sale Price

Output Value


PD/Ha Le/Ha PD/Ha Gal/Ha Le/Gal Le/Ha Le/Ha Le/PD

Kailahun Average 34 224,275 32 54 9,484 512,136 287,861 8,996Kenema Average 51 296,576 10 26 5,800 150,800 (‐)146,576 (‐)14,657 Kono Average 35 189,367 54 40 8,000 320,000 130,633 2,419


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Table 15: Average Cost and Returns in Small Farm Oil Palm Plantations in Sierra Leone, 2008 Crop Season (without two largest farms in Kenema – 16.3 & 13.2 ha)

District Hired Labour Family Labour

Oil Yield

Sale Price

Output Value


PD/Ha Le/Ha PD/Ha Gal/Ha Le/Gal Le/Ha Le/Ha Le/PD

Kailahun 34 224,275 32 54 9,484 512,136 287,861 8,996 Kenema 40 202,267 14 36 5,843 210,348 8,081 577 Kono 35 189,367 54 40 8,000 320,000 130,633 2,419

Source: EDS Field Survey 4.5: Conclusion

From the analysis in this chapter it is clear that small holder tree crop farming is very profitable under current pricing regimes. However yields are low and there is obviously much scope for increasing them using improved planting materials and cultural practices. Development agencies should concentrate on helping farmers to invest in the new technologies. The supply of improved planting materials is critical in this regard and the clonal gardens of the Sierra Leone Agricultural Research Institute should be rehabilitated and expanded to provide a domestic source of supply.

CHAPTER 5. MARKETING CHAIN STUDY

The aim of the marketing study was to describe the off farm marketing system for Cocoa, Coffee and Oil palm products that supply domestic markets in Sierra Leone, and the export markets in neighbouring countries as well as the international trade. Tracing studies were conducted from each major assembly/buying point in each selected chiefdom to Freetown. Backward tracing studies from the port of Freetown were also conducted for a number of cocoa and coffee exporters.

5.1. Cocoa and Coffee Marketing Chain15

Marketing channels for cocoa and coffee are similar, usually with the same agents handling both commodities. Table 16 contains figures showing that virtually all cocoa and coffee farmers made sales in 2008, except for coffee farmers in Kenema where the proportion was

15 This section only provides a brief description of the marketing chain focusing on quantitative information on flows. For a more complete description of the cocoa value chain, including a description of the key players in the system, constraints and opportunities see A. T. Roberts (2009), Value Chains in Sierra Leone: A Situation Report and Identification of Strategic Opportunities. Prepared for Private Sector Development Strategy Project (PSDSP), Ministry of Trade and Industry, Freetown, Sierra Leone

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lower at about 82 percent indicating that some 20 percent of the farmers still found the price too low to enter the market. Table 16: Proportion of Sample Farmers Making Sales of Tree Crop Products and Average Quantities Sold, Sierra Leone, 2008

Product Kailahun District Kenema District Kono District Farmers Who Made Sales (%)Cocoa 96 93 99 Coffee 94 82 100 Palm Oil 59 95 79 Palm Kernels 7 0 7 % Production Sold (For Farmers With Sales) Cocoa 97 87 100 Coffee 97 87 99 Palm Oil 67 62 67 Palm Kernels 66 0 67 Weighted Average Quantities Sold Per Farmer (Kg) Cocoa 620 655 623 Coffee 253 401 413 Palm Oil 125 194 171 Palm Kernels Source: EDS Field survey, 2009

Virtually all cocoa and coffee beans harvested in Kailahun and Kono was sold by farmers. In Kenema, a small proportion of output was used for gifts particularly to relatives who then sold the produce. The figures in Table 16 further show that cocoa farmers on the average sold over 600 Kg of cocoa in 2008 while coffee farmers in Kono and Kenema sold twice as much produce as those in Kailahun. Figure 15 shows the marketing channels for cocoa and coffee in Sierra Leone and Table 17 shows the importance of different locations and buyers in the purchase of the produce from farmers. There is practically no farm gate sale or transportation of cocoa and coffee to Freetown by farmers. Virtually all sales are made to Traders (Buying Agents of the exporters), and the transaction takes place most often at the Village in which the farmer resides. Very few farmers transport their produce to Kailahun town for sale, in contrast to Kenema and Kono where over a third of the farmers transport their produce to the District Headquarter town for sale. The poor road network in Kailahun compared to the other Districts is a major contributing factor to farmers’ decisions as to where to sell their produce. Assembly and transport of cocoa and coffee beans from the villages in which farmers reside to the Stores of the Exporters in the District headquarter towns (Kono, Kailahun and Kenema) is by the buying agents of the Exporters. The exporters set the price of the produce

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and provide the buying agents with a buying commission. They also as a rule provide the agents with a short term loan which is recovered in the form of produce delivered to the Exporters stores. One of the exporters has a mechanical drying plant for cocoa in Kailahun; otherwise any drying necessary is done manually at the buying store using tarpaulin or plastic sheets and concrete drying floors in a few instances.

Kailahun Kono Kenema Guinea & Cote d’Ivoire

Farm Production & Processing

District

Headquarters AssemblyD i

Drying & Grading

Assembly

Drying & Grading

Freetown

Drying & Grading

Transport

Transport

Export

Figure 15: Cocoa and Coffee Marketing Channels in Sierra Leone

Shipment

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Table 17: Marketing Cocoa and Coffee by Point of First Sale and Buyers in Sierra Leone, 2008 (Percent of farmers in a District who made sales)

Cocoa Coffee

District Buyer Farm Gate

Village C/Dom HQ

District HQ

F/town Farm Gate

Village C/Dom HQ

District HQ

F/town

Kailahun Other Farmer 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Trader 1.2 45.5 29.9 9.0 1.2 3.4 44.9 39.3 4.5 1.1 Coop 0.0 0.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Assoc 0.0 0.6 0.0 1.2 0.0 0.0 0.0 0.0 0.0 0.0 Other 0.0 9.0 1.2 0.6 0.0 0.0 6.7 0.0 0.0 0.0 Kenema Other

Farmer 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Trader 0.0 40.0 12.0 48.0 0.0 0.0 35.7 14.3 35.7 0.0 Coop 0.0 0.0 0.0 0.0 0.0 7.1 0.0 0.0 0.0 0.0 Assoc 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Other 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Kono Other

Farmer 0.0 1.0 0.0 0.0 0.0 0.0 2.3 0.0 0.0 0.0 Trader 1.0 42.4 11.1 32.3 1.0 0.0 37.9 3.4 43.7 0.0 Coop 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Assoc 0.0 1.0 0.0 0.0 0.0 0.0 3.4 0.0 0.0 0.0 Other 0.0 1.0 0.0 9.1 0.0 0.0 0.0 0.0 9.2 0.0

Source: EDS Field survey, 2009 Apart from the new organic cocoa company BioUnited which has its main buying facility in Pendembu in Kailahun District and ships from there to Freetown, all the other exporters bulk their cocoa in Kenema where the beans are often mechanically dried, graded, packed and shipped to warehouses in Freetown for export. Figure 16 illustrates the flow of produce from the producing areas to Freetown with rough estimates of quantities that moved from different areas in the 2008 crop season. Table 18 shows the estimated quantities of cocoa and coffee exported to Europe as reported locally by the Bank of Sierra Leone and internationally in UN Statistics. The figures show quite a variation in terms of quantities and export values. Although there is likely o be some double counting of export quantities as reported in import figures by Sierra Leone’s external trade partners, the substantial difference in export price between the FOB price reported in Bank of Sierra Leone statistics and the CIF prices reported in the UN trade statistics cannot be explained by double counting of export volumes. The inevitable conclusion is that there is significant under reporting of export volumes and particularly of export prices in the local statistics. The extreme reluctance of exporters to disclose the export price to EDS investigators lends credence to this view.16 16 By contrast EDS investigators had no difficulties in obtaining cost figures from the exporters!

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Koindu

Kailahun Kenema

Kono

Freetown

Guinea & Cote d’Ivoire

7,200 mt

1800 mt

5,300 mt

Figure 16: Flow of Sierra Leone Cocoa from producing areas to export market in 2008 (export volume from COMTRADE)

Estimated marketing margins are reported in Table 19. Using the CIF Europe prices reported in the UN Statistics the exporter’s margins (including the margins by the Buying Agents) are estimated at 86% of the farm gate price for coffee and 107% for cocoa. The negative margins shown when Bank of Sierra Leone FOB export prices are used confirms that the reported prices are unrealistically low – they were even lower that the farm gate prices reported by farmers in the farm survey!

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Table 18: Sierra Leone Coffee and Cocoa Export Volumes and Prices

Bank of Sierra Leone COMTRADEa Bank of Sierra Leone COMTRADE

Year COFFEE COFFEE COFFEE COFFEE COCOA COCOA COCOA COCOA

mt $/mt (FOB) mt $/mt (CIF) mt $/mt (FOB) Mt $/mt (CIF)

1996 1,784.2 794.8 3,115.7 794.4

1997 2,780.3 728.0 2,334.4 874.3

1998 1,756.0 600.6 2,432.0 598.3

1999 1,216.0 600.1 1,334.0 426.6

2000 1,980.9 322.5 1,412.4 214.0

2001 74.9 305.7 641.0 414.8

2002 947.2 287.3 1,177.6 1,034.9

2003 113.0 354.9 2,733.4 941.3

2004 118.0 447.5 6,187.5 850.0

2005 1,532.0 570.4 1,218.8 1,017.9 6,634.5 789.3 10,940.7 1,426.22006 1,475.2 741.2 2,344.1 1,124.6 13,939.7 830.1 15,041.8 1,436.92007 2,483.2 746.9 2,268.2 1,757.9 13,721.6 828.5 21,194.6 1,612.42008 (Jan–June) 1,623.0 750.3 2,093.9 1,631.4 5,809.0 838.4 15,713.4 2,189.0

a Volume of imports and CIF prices reported by Sierra Leone’s trading partners (Source: UN COMTRADE Database, 2009) Table 19: Estimated Marketing Margins for Cocoa and Coffee in Sierra Leone, 2008 Buying Season (Le 1,000 per mt)

Coffee Cocoa

Farm Gate (Kailahun) Farmers pricea 2,996 2,658 Transport to Kenema 200 183

Buying Station (Kenema) Regional buying price (Kenema) 3,190 3,740 Drying (labour + plastic sheets) 205 205 Bagging (bags + sewing) 69 69 Produce examination (grading & labelling) 13 13

Exporter (Freetown) Export price (FOB)b 2,250 2,514 Export price (CIF Europe)c 6,609 6,549 Transportation (Kenema ‐ Freetown) 85 85 Storage & handling 33 33 Shipment (examination, booking & handling) 132 132 Freight to Europe 435 435 Insurance (Clause B ‐ 1.0% CF) 66 65

Exporters margin (at FOB) ‐1,283 ‐681 Exporters margin (at CIF) 2,575 2,854 Source: a EDS farm survey; b Bank of Sierra Leone; Trade Statistics; cCOMTRADE

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5.2 Oil Palm Produce Marketing Chain

The figures in Table 16 show that in contrast to cocoa and coffee, a much lower percentage of farmers make palm oil sates and a lower proportion of the production was sold by farmers making sales. This is due to the fact that significant quantities are used for home consumption. The figures in the table also confirm the fact revealed during the KAP survey that there is virtually no sale of palm kernels by farmers. The pattern of sales of palm oil by farmers is similar to that for cocoa and coffee (Table 20), except that there is more on‐farm sale especially in Kono where about 20 percent of the farmers make such sales. The itinerant traders in palm oil appear to be more active than those in cocoa and coffee, reaching farther into the production areas to obtain their supplies. This is probably due to local competition for supplies of a commodity that has a market all over the country as the principal cooking oil used by consumers. Table 20: Marketing Palm Oil by Point of First Sale and Buyers in Sierra Leone, 2008 (Percent of farmers in a District who made sales)

District Buyer Palm Oil

Farm Gate

Village C/Dom HQ

District HQ

Freetown

Kailahun Other Farmer 0.0 0.0 0.0 0.0 0.0 Trader 0.0 59.4 28.1 12.5 0.0 Coop 0.0 0.0 0.0 0.0 0.0 Assoc 0.0 0.0 0.0 0.0 0.0 Other 0.0 0.0 0.0 0.0 0.0 Kenema Other Farmer 0.0 0.0 0.0 0.0 0.0 Trader 0.0 78.9 21.1 0.0 0.0 Coop 0.0 0.0 0.0 0.0 0.0 Assoc 0.0 0.0 0.0 0.0 0.0 Other 0.0 0.0 0.0 0.0 0.0 Kono Other Farmer 0.0 0.0 9.1 0.0 0.0 Trader 18.2 18.2 9.1 45.5 0.0 Coop 0.0 0.0 0.0 0.0 0.0 Assoc 0.0 0.0 0.0 0.0 0.0 Other 0.0 0.0 0.0 0.0 0.0

Source: EDS farm survey The marketing channels for palm oil are very similar to those for local rice. (Figure 17) with itinerant traders obtaining supplies from farmers and selling either to wholesalers in District Headquarter towns who then transport the produce to the major urban centres, or they themselves transporting the produce and selling it directly to consumers in large as well as small urban centres.

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Figure 17: Marketing Channels for Palm Oil in Sierra Leone

The situation for palm kernels is different as there is currently only one buyer of the commodity in the country – the Marika Palm Kernel Oil Company in Freetown. The Company currently purchases about 6000 mt of cracked palm kernels from virtually all Districts of the country, distributed as shown in Figure 18 and processes into crude and refined palm kernel oil, laundry and toilet soap. The Company has a capacity to process more than double its current purchases but finds difficulty in obtaining supplies of cracked nuts because farmers find the labour intensive kernel cracking process by hand very taxing and unrewarding. Attempts by the Company to introduce small motorised crackers to farmers were not successful as the imported mills proved to be unsuitable. The Company is seeking investment to acquire a fleet of trailers that would allow it to purchase un‐cracked kernels from farmers and transport them to its factory in Freetown. 5.3: Conclusion

This study shows that profit margins by exporters of cocoa and coffee are high, even for the poor quality of produce supplied to the international market. There is therefore scope for increased payments to farmers, particularly for payment of a premium for high quality produce.

Farmer (Production & Processing)

Itinerant Trader / Local Assembler

Wholesaler

Retailer

Consumer

49

Figure 18: Flow of Palm Kernels from Buying Centres to Freetown

There is a latent market for palm kernels as the Marika Oil mill in Freetown which is currently operating at less than 50% of its capacity. Investment in a marketing system for palm kernels will help open up the market as the Company is currently only able to purchase and transport cracked nuts. Cracking of nuts manually is a very labour consuming activity with relatively low returns, restricting the supply to the Mill. The supply of uncracked nuts is much greater.

Kailahun

Kono

Pujehun

Bo

TonkoliliP‐Loko

Kambia

Freetown

Bombali

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