potato value chain in bangladesh final -...
TRANSCRIPT
1
Potato Value Chain in Bangladesh
Information and Knowledge gaps
Potato Value Chain in Bangladesh
formation and Knowledge gaps of smallholders
December 2011
Submitted to
1
6/8 Humayun Road
Telephone: 8124976, 9131424, 8156772
E-mail: [email protected]
2
3
Potato has been cultivated in Bangladesh for more than a century, and has recently occupied an 4
important place in the country’s 5
been thriving with new opportunities. The value6
huge potential of the sector and to identify bottlenecks hindering 7
analysis the study attempts to analyze the systemic issues faced within the whole process8
farming to exporting—with particular focus on knowledge and information gaps. The study 9
identifies bottlenecks the sector is facing, relationship10
actors, the flow of products and the changes in value and 11
Submitted by
6/8 Humayun Road Block: B, Mohammadpur Dhaka-1207 Bangladesh.
Telephone: 8124976, 9131424, 8156772
[email protected] . Website: www.dnet.org.bd
Abstract
Potato has been cultivated in Bangladesh for more than a century, and has recently occupied an
country’s list of major food and cash crops. Over the years, the sector has
been thriving with new opportunities. The value chain analysis was conducted considering the
huge potential of the sector and to identify bottlenecks hindering its growth.
analysis the study attempts to analyze the systemic issues faced within the whole process
particular focus on knowledge and information gaps. The study
identifies bottlenecks the sector is facing, relationships and linkages between and among the
actors, the flow of products and the changes in value and in the information and knowledge flow.
2
1207 Bangladesh.
Potato has been cultivated in Bangladesh for more than a century, and has recently occupied an
Over the years, the sector has
conducted considering the
The value chain
analysis the study attempts to analyze the systemic issues faced within the whole process—from
particular focus on knowledge and information gaps. The study
and linkages between and among the
information and knowledge flow.
It is evident from the study that potato production in Bangladesh has marked 12
over the last few years, despite the fact that, in peak seasons, growers face enormous difficulties 13
with their surplus production due to cold storages capacity constraints leading to unfavourable 14
pricing. The paper addresses some systematic information15
value chain and offers some possible solutions to farmers in the use of inputs and also to cold 16
storage operators and farmer associations to coordinate the uneven use of even the small amount 17
of such available facilities. 18
19
20
potato production in Bangladesh has marked significant growth
rs, despite the fact that, in peak seasons, growers face enormous difficulties
with their surplus production due to cold storages capacity constraints leading to unfavourable
pricing. The paper addresses some systematic information-related problems faced
value chain and offers some possible solutions to farmers in the use of inputs and also to cold
storage operators and farmer associations to coordinate the uneven use of even the small amount
3
significant growth
rs, despite the fact that, in peak seasons, growers face enormous difficulties
with their surplus production due to cold storages capacity constraints leading to unfavourable
related problems faced within the
value chain and offers some possible solutions to farmers in the use of inputs and also to cold
storage operators and farmer associations to coordinate the uneven use of even the small amount
21
22
Abstract ................................................................23
Contents................................................................24
Abbreviations ................................25
Prelude................................................................26
Methodology ................................27
Introduction ................................28
Overview ................................................................29
Potato Production ................................30
Yield and Yield Variation................................31
Potato cultivation ................................32
Potato Varieties and Grades ................................33
State Support ................................34
Mapping the Value Chain................................35
Product Flow and Value Chain Actors36
Information Flow in the Value Chain37
Price Information ................................38
Input and Know-how Information39
Financial Assistance................................40
Transaction Costs ................................41
Identified Issues in the Value Chain42
Lack of Knowledge of Farmers on Quality Inputs and Their Usage43
Lack of Knowledge of Farmers on Variety, Grading, Processing and Export Market44
Lack of Knowledge of Farmers on Post45
Lack of Information on Available Space in Cold Storage …………………………….2746
Conclusion………………………………………………………………………………47
Appendices ................................................................48
Contents
................................................................................................
................................................................................................
................................................................................................................................
................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................
................................................................................................
................................................................................................
..........................................................................................................................
................................................................................................
................................................................................................................................
................................................................................................
Product Flow and Value Chain Actors ................................................................
Information Flow in the Value Chain .............................................................................................
................................................................................................
how Information ..............................................................................................
................................................................................................
................................................................................................
Identified Issues in the Value Chain .............................................................................................
Lack of Knowledge of Farmers on Quality Inputs and Their Usage................................
Lack of Knowledge of Farmers on Variety, Grading, Processing and Export Market
Lack of Knowledge of Farmers on Post-harvest Techniques ................................
Lack of Information on Available Space in Cold Storage …………………………….27
Conclusion………………………………………………………………………………
................................................................................................
4
............................................... 2
............................................... 4
...................................... 6
................................................. 7
....................................... 8
...................................... 11
........................................ 11
........................................................... 19
............................................... 21
.......................... 225
......................................... 235
................................ 235
.............................................. 245
......................................................... 245
............................. 22
........................................................ 23
.............................. 24
.................................................... 24
......................................................... 374
............................. 395
............................................ 395
Lack of Knowledge of Farmers on Variety, Grading, Processing and Export Market ................ 406
....................................................... 417
Lack of Information on Available Space in Cold Storage …………………………….27
Conclusion……………………………………………………………………………… 438
...................................... 449
Appendix 1: Selection of Most Potential Export Oriented Agricultural Value Chains49
Appendix 2: List of Respondents50
51
Appendix 1: Selection of Most Potential Export Oriented Agricultural Value Chains
Appendix 2: List of Respondents ................................................................................................
5
Appendix 1: Selection of Most Potential Export Oriented Agricultural Value Chains ............... 449
................................. 515
Abbreviations 52
53
BADC Bangladesh Agricultural Development Corporation
BARI Bangladesh Agricultural Research Institutes
BBS Bangladesh Bureau of Statistics
BDT Bangladeshi Taka
CIC Community Information Center
DAE Department of Agricultural Extension
DAM Department of Agricultural Marketing
FAO Food and Agriculture Organization
FAOSTAT Food and Agriculture Organization Statistics
FGD Focus Group Discussion
ICT Information and Communication Technology
KBE Knowledge Based Economy
MMS Multimedia Messaging Service
MSEs Micro and Small Enterprises
MT Metric Tonne
NGO Non-Governmental Organization
SMEs Small and Medium Enterprises
SMS Small Message Service
TCRC Tuber Crops Research Centre
TVC Television Commercial
USD United States Dollar
VAT Value Added Tax
54
55
56
57
Bangladesh Agricultural Development Corporation
Bangladesh Agricultural Research Institutes
Bangladesh Bureau of Statistics
Bangladeshi Taka
Community Information Center
Department of Agricultural Extension
Agricultural Marketing
Food and Agriculture Organization
Food and Agriculture Organization Statistics
Focus Group Discussion
Information and Communication Technology
Knowledge Based Economy
Multimedia Messaging Service
Micro and Small Enterprises
Governmental Organization
Small and Medium Enterprises
Small Message Service
Tuber Crops Research Centre
Television Commercial
United States Dollar
Value Added Tax
6
58
59
60
61
62
63
64
65
66
67
68
69
Prelude 70
The research was envisaged to identify the bottlenecks to increased production of high quality 71
potatoes in Bangladesh that holds a huge potential to cater to the expanding market. 72
73
The specific objectives of this Knowledge Based 74
75
• Achieve an in‐depth understanding of how innovations related to Information and 76
Communication Technologies (ICTs) are used (and may be used) to improve the 77
efficiency and inclusiveness78
was on increasing the participation (inclusiveness) of small players79
small enterprises (MSEs), and small and medium enterprises (SMEs) within the value 80
chain through various forms of value addition and 81
transaction costs. 82
• Develop recommendations for improving the efficiency and inclusiveness of agricultural 83
value chains including through the application of ICTs, but not limited to them; 84
to identify the bottlenecks to increased production of high quality
potatoes in Bangladesh that holds a huge potential to cater to the expanding market.
The specific objectives of this Knowledge Based Economy (KBE) research were
depth understanding of how innovations related to Information and
Communication Technologies (ICTs) are used (and may be used) to improve the
inclusiveness of the potato value chain in Bangladesh; the specific focus
was on increasing the participation (inclusiveness) of small players, especially micro and
small enterprises (MSEs), and small and medium enterprises (SMEs) within the value
chain through various forms of value addition and reduction of various forms of
Develop recommendations for improving the efficiency and inclusiveness of agricultural
value chains including through the application of ICTs, but not limited to them;
7
to identify the bottlenecks to increased production of high quality
potatoes in Bangladesh that holds a huge potential to cater to the expanding market.
Economy (KBE) research were to:
depth understanding of how innovations related to Information and
Communication Technologies (ICTs) are used (and may be used) to improve the
h; the specific focus
especially micro and
small enterprises (MSEs), and small and medium enterprises (SMEs) within the value
reduction of various forms of
Develop recommendations for improving the efficiency and inclusiveness of agricultural
value chains including through the application of ICTs, but not limited to them;
specifically, identify and differentiat85
private sector vs. the public sector in providing such services to MSEs and SMEs.86
• Based on the in‐depth understanding87
related to measuring progress toward 88
89
In order to carry out KBE research in 90
selected through desk research. The following criteria were used to select 91
export-oriented agricultural value chains:92
Goods that 93
94
a) have potential for value addition,95
b).have high participation (or potential for participation) by small 96
MSE/ SMEs, 97
c. have high export potential98
d. have potential for increased productivity.99
100
After a rigorous desk research followed by 101
as one of the two most potential value chains and was analysed 102
describes the in-depth analysis of 103
104
Methodology 105
106
The study adopted the value chain analysis method to unfold the industry dynamics, its market 107
actors and different service provisions, constraints and108
carried out through desk research and in109
1 See Appendix 1 for selection summary
specifically, identify and differentiate between the roles that shall be played by the
private sector vs. the public sector in providing such services to MSEs and SMEs.
depth understanding mentioned above, contribute to improving indicators
related to measuring progress toward inclusive knowledge‐based economies.
In order to carry out KBE research in the Bangladesh agriculture sector, two value chains were
selected through desk research. The following criteria were used to select the two most potential
ral value chains:
have potential for value addition,
high participation (or potential for participation) by small
export potential, and
ave potential for increased productivity.
s desk research followed by a short-listing and ranking exercise1, potato came out
as one of the two most potential value chains and was analysed further afterwards. This report
depth analysis of the potato value chain.
The study adopted the value chain analysis method to unfold the industry dynamics, its market
actors and different service provisions, constraints and opportunities. The overall research was
carried out through desk research and in-depth interviews and Focus Group Discussion
See Appendix 1 for selection summary
8
e between the roles that shall be played by the
private sector vs. the public sector in providing such services to MSEs and SMEs.
mentioned above, contribute to improving indicators
based economies.
Bangladesh agriculture sector, two value chains were
two most potential
actors including
, potato came out
further afterwards. This report
The study adopted the value chain analysis method to unfold the industry dynamics, its market
opportunities. The overall research was
and Focus Group Discussions (FGDs).
The desk research involved reviewing 110
research helped develop a general understanding of the overall sector. It resulted in identifying 111
different market actors and nodal points within the value chain which112
depth interview respondents. The113
research agencies, value chain actors and industry associations. A snow114
adopted to develop the entire value chain. The process started with identifying and interviewing 115
end market factors such as exporters, then gradually moving 116
supplier level. In all, 72 interviews were conducted with different value chain actors, key 117
informants and service providers. 118
geographical locations were selected as potato producing clusters representing the diversified 119
nature of varieties and yield. The areas were Munshiganj (historically large scale potato 120
producing district), Comilla (agriculturally progressive district producing 121
scale) and Rangpur (joined recently in large scale potato production). Three FGDs were carried 122
out with potato farmers in these three different areas to capture the overall 123
Primary data was collected during 124
with interviews and FGDs throughout the study period to validate field findings with available 125
facts and figures. The overall research ap126
127
1. Mapping the core processes in the value chain,128
2. Identifying the actors, 129
3. Identifying the services that feed into the value chain,130
4. Mapping the relationships and linkages, 131
5. Mapping the flow of products including the geogra132
6. Mapping the changes in the value and form of the products,133
7. Mapping the information and knowledge flows,134
8. Mapping the number of actors and employment, and 135
9. Identifying the transaction costs and ways to reduce them. 136
137
The desk research involved reviewing the existing literature on the sector. The initial desk
eneral understanding of the overall sector. It resulted in identifying
different market actors and nodal points within the value chain which, in turn,
depth interview respondents. They included industry experts, concerned government and
research agencies, value chain actors and industry associations. A snow-balling approach was
adopted to develop the entire value chain. The process started with identifying and interviewing
tors such as exporters, then gradually moving up the value chain
72 interviews were conducted with different value chain actors, key
informants and service providers. The list of respondents is given in Appendix 2. Three different
geographical locations were selected as potato producing clusters representing the diversified
nature of varieties and yield. The areas were Munshiganj (historically large scale potato
(agriculturally progressive district producing potato on a
) and Rangpur (joined recently in large scale potato production). Three FGDs were carried
out with potato farmers in these three different areas to capture the overall production scenario.
collected during the first quarter of 2011. Desk research was continued along
with interviews and FGDs throughout the study period to validate field findings with available
facts and figures. The overall research applied the following approaches:
Mapping the core processes in the value chain,
Identifying the services that feed into the value chain,
Mapping the relationships and linkages,
Mapping the flow of products including the geographical flow,
Mapping the changes in the value and form of the products,
Mapping the information and knowledge flows,
Mapping the number of actors and employment, and
Identifying the transaction costs and ways to reduce them.
9
the sector. The initial desk
eneral understanding of the overall sector. It resulted in identifying
helped select in-
included industry experts, concerned government and
balling approach was
adopted to develop the entire value chain. The process started with identifying and interviewing
the value chain to the input
72 interviews were conducted with different value chain actors, key
in Appendix 2. Three different
geographical locations were selected as potato producing clusters representing the diversified
nature of varieties and yield. The areas were Munshiganj (historically large scale potato
potato on a moderate
) and Rangpur (joined recently in large scale potato production). Three FGDs were carried
production scenario.
first quarter of 2011. Desk research was continued along
with interviews and FGDs throughout the study period to validate field findings with available
The report begins with a brief description of the Bangladesh potato sector138
the value chain including the information and knowledge flows at different tiers. It also 139
summarizes the constraints and opportunities and possible solutions to address them. As the key 140
focus of the study is to identify the knowledge g141
research. 142
143
a brief description of the Bangladesh potato sector followed by mapping
the value chain including the information and knowledge flows at different tiers. It also
summarizes the constraints and opportunities and possible solutions to address them. As the key
focus of the study is to identify the knowledge gaps, it is reflected from the very beginning of the
10
followed by mapping
the value chain including the information and knowledge flows at different tiers. It also
summarizes the constraints and opportunities and possible solutions to address them. As the key
very beginning of the
Introduction 144
145
Overview 146
Potato has been cultivated in Bangladesh for more than a century and has recently occupied an 147
important place in its list of major food and cash 148
a vegetable in Bangladesh, while 149
After the introduction of cold storage facilities in 150
the most promising crops as it can now be consumed throughout the year. Potato consumption in 151
Bangladesh is next only to two major cereals152
consume cheap potatoes more than other vegetables (Moazzem153
per capita consumption of potato is still much lower (about 24 kg per year) than 154
countries. However, the data is based on 155
country and not on the basis of foo156
However, since the overall export volume is still very low compared to the total production, it 157
may not impact the data very significantly.158
2 Moazem G.K. and Fuzita J (2004), perspective of A village study in Comilla district, TheDevelopingEconomies,XLII
Potato has been cultivated in Bangladesh for more than a century and has recently occupied an
list of major food and cash crops. It is a subsidiary food item consumed as
while in many countries of the world it constitutes the staple food.
After the introduction of cold storage facilities in the late eighties, it has turned
the most promising crops as it can now be consumed throughout the year. Potato consumption in
Bangladesh is next only to two major cereals—rice and wheat, and low-income households
consume cheap potatoes more than other vegetables (Moazzem and Fuzita, 2004)
per capita consumption of potato is still much lower (about 24 kg per year) than
However, the data is based on the production of potato and the population of the
country and not on the basis of food intake (Hussain, 2008), and it also excludes exports.
However, since the overall export volume is still very low compared to the total production, it
may not impact the data very significantly.
Moazem G.K. and Fuzita J (2004), The potato marketing system and its changes In Bangladesh: from the omilla district, TheDevelopingEconomies,XLII-1(March2004):63
11
Potato has been cultivated in Bangladesh for more than a century and has recently occupied an
It is a subsidiary food item consumed as
in many countries of the world it constitutes the staple food.
late eighties, it has turned out to be one of
the most promising crops as it can now be consumed throughout the year. Potato consumption in
income households
and Fuzita, 2004)2. The present
per capita consumption of potato is still much lower (about 24 kg per year) than in many other
population of the
and it also excludes exports.
However, since the overall export volume is still very low compared to the total production, it
angladesh: from the 1(March2004):63−94
159
Figure1. Per head per year consumption of potato in Bangladesh (24.09 kg) compared to some 160
other countries of the world3. 161
162
The overall global production of potato has increased over the last few decades despite 163
production in developed countries experiencing a164
1991 the volume of global potato production was 268 million tonnes whereas 165
325 million tonnes in 2007. The global potato sector has been undergoing many changes since 166
the early 1990s. Before 1990s, most potatoes were grown and consumed in Europe, North 167
America and countries of the former Soviet Union. However, since then, there h168
dramatic increase in potato production and 169
output rose from less than 30 million tonnes in the early 1960s to more than 165 million tonnes 170
in 2007. FAO data shows that in 2005, for the first time171
production exceeded that of the developed world. China has now become the biggest potato 172
3 Hussain, M.M. 2008. Prospects of potato in Bangladesh.
CSD, Dhaka, Bangladesh
835.
6
415.
1
0
100
200
300
400
500
600
700
800
900
Per
hea
d/y
ear c
on
sum
pti
on
(k
g)-
Belarus
Netherlands
Per head per year consumption of potato in Bangladesh (24.09 kg) compared to some
The overall global production of potato has increased over the last few decades despite
production in developed countries experiencing a steady decline. According to FAO data, in
of global potato production was 268 million tonnes whereas production reached
325 million tonnes in 2007. The global potato sector has been undergoing many changes since
the early 1990s. Before 1990s, most potatoes were grown and consumed in Europe, North
America and countries of the former Soviet Union. However, since then, there h
dramatic increase in potato production and in demand in Asia, Africa and Latin America, where
output rose from less than 30 million tonnes in the early 1960s to more than 165 million tonnes
that in 2005, for the first time, the developing world's potato
production exceeded that of the developed world. China has now become the biggest potato
. 2008. Prospects of potato in Bangladesh. in Bangladesh Potato Campaign 2008. MOA, FAO &
835.
6
415.
1
414.
8
291.
1
286
271
267.
4
261.
2
259
219.
4
24.0
9
Belarus
Netherlands
Ukraine
Denm
ark
Latvia
Poland
Belgium
Lithunia
Russia
Kyrgyzstan
Bangladesh
Countries
12
Per head per year consumption of potato in Bangladesh (24.09 kg) compared to some
The overall global production of potato has increased over the last few decades despite
steady decline. According to FAO data, in
production reached
325 million tonnes in 2007. The global potato sector has been undergoing many changes since
the early 1990s. Before 1990s, most potatoes were grown and consumed in Europe, North
America and countries of the former Soviet Union. However, since then, there has been a
demand in Asia, Africa and Latin America, where
output rose from less than 30 million tonnes in the early 1960s to more than 165 million tonnes
, the developing world's potato
production exceeded that of the developed world. China has now become the biggest potato
Bangladesh Potato Campaign 2008. MOA, FAO &
producer, and almost a third of all potato is harvested in China and India. Currently, Bangladesh 173
is ranked 12th in the global potato p174
175
176
Figure 2. Top potato producing countries of the world in 2009 (Source: FAOSTAT)177
178
Potato consumption, especially fresh potato, is decreasing in many countries, especially in 179
developed regions. Currently, more potatoes are processed to meet 180
fast food, snack and convenience food industries. The major drivers behind this development 181
include growing urban populations, rising incomes, the diversification of diets 182
leave little time for preparing the fresh product for consumption.183
184
Potato, till today, is consumed 185
Activities towards promoting potato as a partial supplement to rice (rice is the major staple food) 186
4 FAOSTAT
producer, and almost a third of all potato is harvested in China and India. Currently, Bangladesh
in the global potato production list in terms of quantity.4
Top potato producing countries of the world in 2009 (Source: FAOSTAT)
Potato consumption, especially fresh potato, is decreasing in many countries, especially in
regions. Currently, more potatoes are processed to meet the rising demand from the
fast food, snack and convenience food industries. The major drivers behind this development
include growing urban populations, rising incomes, the diversification of diets and lifestyles that
time for preparing the fresh product for consumption.
Potato, till today, is consumed round the year in Bangladesh, mostly as a fresh vegetable.
Activities towards promoting potato as a partial supplement to rice (rice is the major staple food)
13
producer, and almost a third of all potato is harvested in China and India. Currently, Bangladesh
Top potato producing countries of the world in 2009 (Source: FAOSTAT)
Potato consumption, especially fresh potato, is decreasing in many countries, especially in
rising demand from the
fast food, snack and convenience food industries. The major drivers behind this development
and lifestyles that
in Bangladesh, mostly as a fresh vegetable.
Activities towards promoting potato as a partial supplement to rice (rice is the major staple food)
has not yet resulted in any significant success. The underlying reasons are 187
habits of Bangladeshi people and 188
remains reasonably low during the peak harvesting period and 189
in cold stores is completed. The stated situation indicates that there is little scope for 190
increase in per capita consumption of fresh potatoes in 191
country human consumption of fresh potatoes is192
rate of population increase, thereby maintaining the same per capita consumption. 193
production exceeding human consumption as fresh produce can be expected if the processing 194
and exports of potatoes increase significantly.195
196
The main export market for fresh potato is the developed world, and 197
statistics, the top ten potato importing countries 198
Russia, the USA, Germany, the UK, France and Portugal. 199
potato in the 1980s, and so far the highest amount of potato exported from Bangladesh was about 200
16,500 tonnes last fiscal year (2010201
products include the Republic of Korea, Italy, Singapore, Malaysia, 202
The opening of new markets in Russia, Vietnam and Sri Lanka facilitated the recent 203
exports. (Source: DAE). 204
205
Figure 3 and 4 illustrate the country206
the quantity of fresh potato export207
208
any significant success. The underlying reasons are the
adeshi people and the high price of potato in recent years. Generally, the price
remains reasonably low during the peak harvesting period and rises high when loading
in cold stores is completed. The stated situation indicates that there is little scope for
increase in per capita consumption of fresh potatoes in the near future. However, the total in
country human consumption of fresh potatoes is likely to increase, at least, in proportion to
thereby maintaining the same per capita consumption.
human consumption as fresh produce can be expected if the processing
exports of potatoes increase significantly.
fresh potato is the developed world, and according to
the top ten potato importing countries are Belgium, the Netherlands, Spain, Italy,
he UK, France and Portugal. Bangladesh started
1980s, and so far the highest amount of potato exported from Bangladesh was about
last fiscal year (2010-11). Major export markets of Bangladesh potato and potato
Republic of Korea, Italy, Singapore, Malaysia, the UK, India and
The opening of new markets in Russia, Vietnam and Sri Lanka facilitated the recent
Figure 3 and 4 illustrate the country-wise import and export of potatoes in 2009. Figure 5 shows
fresh potato exports from Bangladesh in 1999 - 2008.
14
the traditional food
recent years. Generally, the price
high when loading potatoes
in cold stores is completed. The stated situation indicates that there is little scope for a significant
near future. However, the total in-
in proportion to the
thereby maintaining the same per capita consumption. Increased
human consumption as fresh produce can be expected if the processing
according to 2008 FAO
he Netherlands, Spain, Italy,
Bangladesh started the export of
1980s, and so far the highest amount of potato exported from Bangladesh was about
export markets of Bangladesh potato and potato
he UK, India and the UAE.
The opening of new markets in Russia, Vietnam and Sri Lanka facilitated the recent growth in
wise import and export of potatoes in 2009. Figure 5 shows
209
Figure 3. Top potato importing countries in 2009 (Source: FAOSTAT)210
211
212
. Top potato importing countries in 2009 (Source: FAOSTAT)
15
. Top potato importing countries in 2009 (Source: FAOSTAT)
Figure 4. Top potato exporting countries in 2009 (Source: FAOSTAT)213
214
215
Figure 5. Quantity of fresh table potato exported from Bangladesh in 1999216
Figures 3 and 4 show that Belgium and 217
also are in the list of top exporting countries. 218
than that of its imports, which may explain the value addition there. However, in 219
unit value of imports into Belgium is a little higher than that of export220
observed in the case of a few other countries as well. For example, Germany’s per unit import 221
value is much higher than per unit export value. Since FAOSTAT categorizes only potatoes and 222
potato flour, it is not very clear how it considers other value added products u223
However, it is clear that a number of countries import and also export potatoes either in the same 224
form or in other value added forms. 225
provide satisfactory leads to resolve this dilemma. 226
Potato is a very popular crop for227
main reasons as found during the FGDs with farmers were its higher profitability, short growth 228
duration, the next crops requiring229
0
1000
2000
3000
4000
5000
6000
7000
8000
Quantity
(m
t)
1999 2000
. Top potato exporting countries in 2009 (Source: FAOSTAT)
Quantity of fresh table potato exported from Bangladesh in 1999-2008 (Source: DAE)
4 show that Belgium and the Netherlands are the top importing countries but they
also are in the list of top exporting countries. The unit value of the Netherlands’ export
which may explain the value addition there. However, in
Belgium is a little higher than that of exports. Similar
few other countries as well. For example, Germany’s per unit import
value is much higher than per unit export value. Since FAOSTAT categorizes only potatoes and
it is not very clear how it considers other value added products u
, it is clear that a number of countries import and also export potatoes either in the same
form or in other value added forms. An examination of these country-wise trade policies may
to resolve this dilemma.
for farmers in Bangladesh, irrespective of land holding size. The
main reasons as found during the FGDs with farmers were its higher profitability, short growth
ing less fertilizer, scope of intercropping/relay cropping
2001 2002 2003 2004 2005 2006 2007 2008
Year
16
. Top potato exporting countries in 2009 (Source: FAOSTAT)
2008 (Source: DAE)
he Netherlands are the top importing countries but they
Netherlands’ exports is higher
which may explain the value addition there. However, in the case of the
. Similar features can be
few other countries as well. For example, Germany’s per unit import
value is much higher than per unit export value. Since FAOSTAT categorizes only potatoes and
it is not very clear how it considers other value added products under potatoes.
, it is clear that a number of countries import and also export potatoes either in the same
wise trade policies may
farmers in Bangladesh, irrespective of land holding size. The
main reasons as found during the FGDs with farmers were its higher profitability, short growth
less fertilizer, scope of intercropping/relay cropping, etc.
Figures 6, 7 and 8 show the potato production and area coverage, yield and export trend230
Bangladesh. 231
232
233
235
236
237
238
239
240
241
242
243
244
245
246
247
0
2,000
4,000
6,000
8,000
2004 2005 2006 2007
Year
Potato production and area
coverage trend
Production in '000 MT
Figure 6. Potato production and area coverage trend in
Bangladesh (Source: FAOSTAT)
potato production and area coverage, yield and export trend
235
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2004 2005 2006
Expo
rt v
olum
e in
MT
Potato export trend
2007 2008 2009
Potato production and area
coverage trend
Area in '000 Ha
0
2
4
6
8
10
12
14
16
18
2004 2005 2006
Yie
ld in
MT/
Ha
Year
Yield trend
Potato production and area coverage trend in
Figure 7. Yield growth trend of potato production in
Bangladesh (Source: FAOSTAT)
17
potato production and area coverage, yield and export trends in
2007 2008 2009 2010 2011
Year
Potato export trend
2007 2008 2009
Year
Yield trend
Yield growth trend of potato production in
248
249
250
251
252
253
These Figures show that in 2004 254
production and 2.76% for yield; for export volume it was 29.12 %. Besides, the growth of 255
area under cultivation was 8.29%. However, there was an overall setback in256
industry experts, there was a potato glut in 2008 and consequently, farmers were compelled to 257
sell their produce at low prices. In the following year, many farmers did not cultivate potatoes or 258
invested less in cultivation which resulted in259
volume has steadily increased during 260
incentives to exporters on the export value, it has been working as a catalyst to increase 261
Till last fiscal year, potato export262
entitled to receive a 20% cash incentive if the 263
shipment was made between February and 264
April. In other months, the incentive was 265
halved to 10% to boost supply in the local 266
market. From the current fiscal year, potato 267
exports are entitled to a 20% cash incentive 268
throughout the year. Figure 8 shows that 269
exports have jumped to 16,500 tonnes in 270
2011. 271
272
Figure 8.
FAOSTAT and DAE)
in 2004 - 2008, the compound annual growth rate was 11.22% for
production and 2.76% for yield; for export volume it was 29.12 %. Besides, the growth of
area under cultivation was 8.29%. However, there was an overall setback in 2009. As opined by
s a potato glut in 2008 and consequently, farmers were compelled to
. In the following year, many farmers did not cultivate potatoes or
invested less in cultivation which resulted in lower yields (Figure 7). However,
volume has steadily increased during the last couple of years. As government provides cash
export value, it has been working as a catalyst to increase
potato exports were
20% cash incentive if the
shipment was made between February and
April. In other months, the incentive was
halved to 10% to boost supply in the local
current fiscal year, potato
20% cash incentive
Figure 8 shows that
exports have jumped to 16,500 tonnes in
Figure 8. Potato export trend in Bangladesh (Source:
FAOSTAT and DAE)
18
compound annual growth rate was 11.22% for
production and 2.76% for yield; for export volume it was 29.12 %. Besides, the growth of the
2009. As opined by
s a potato glut in 2008 and consequently, farmers were compelled to
. In the following year, many farmers did not cultivate potatoes or
(Figure 7). However, the export
last couple of years. As government provides cash
export value, it has been working as a catalyst to increase exports.
273
274
275
276
277
278
279
Potato Production 280
281
According to DAE, potato is grown282
the highest area of concentration is in Bogra283
and 2008-09 and contributing to 10.13% and 13.29% of the national total respectively. This is 284
followed by Rangpur (52,720 ha in 2007285
2007-08 and 37,558 ha in 2008-09), Joypurhat (38,870 ha in 2007286
Munshiganj (36,045 Ha in 2007287
2007-08 and 31,550 ha in 2008-09). 288
289
290
291
292
293
5 Field Service Wing of DAE
According to DAE, potato is grown in all the districts of Bangladesh5 (Figure 9). Among them,
the highest area of concentration is in Bogra—65,300 Hectares (ha) and 61,667 ha in 2007
contributing to 10.13% and 13.29% of the national total respectively. This is
followed by Rangpur (52,720 ha in 2007-08 and 53,700 ha in 2008-09), Dinajpur (42,430 ha in
09), Joypurhat (38,870 ha in 2007-08 and 36,075 ha in 2
Munshiganj (36,045 Ha in 2007-08 and 32,714 Ha in 2008-09), and Rajshahi (35,000 ha in
09).
Figure 9: Potato cultivation by districts in 2007
Food Programme)
19
(Figure 9). Among them,
65,300 Hectares (ha) and 61,667 ha in 2007-08
contributing to 10.13% and 13.29% of the national total respectively. This is
09), Dinajpur (42,430 ha in
08 and 36,075 ha in 2008-09),
09), and Rajshahi (35,000 ha in
Potato cultivation by districts in 2007-08 (Source: World
294
Figure 10. Area under potato 295
2008-09 (Source: Field Service Wing, DAE)296
297
The lowest area coverage is reported to be in Rajbari (96 ha in 2007298
The Dhaka region, particularly Munshiganj, which is generally known as the potato production 299
belt of Bangladesh, is gradually losing its importance in terms of area coverage in potato300
regions like Rajshahi and Rangpur are gaining momentum. 301
highest area concentrations under potato in 2007302
172,091 ha, respectively), showing a steep rise in area under potato cultivation 303
2007-08 (Figure 10). The expansion of 304
namely, Rangpur, Dinajpur, Thakurgaon and Rajshahi is mainly due to 305
a relatively lower lease value leading to lower cost306
307
308
0
20
40
60
80
100
120
140
160
180
200
2000-01
Are
a ('0
00 h
a)
Area under potato cultivation in different regions of the country in 2000
(Source: Field Service Wing, DAE)
The lowest area coverage is reported to be in Rajbari (96 ha in 2007-08 and 137 ha in 2008
e Dhaka region, particularly Munshiganj, which is generally known as the potato production
dually losing its importance in terms of area coverage in potato
regions like Rajshahi and Rangpur are gaining momentum. According to the DAE’s data, the
highest area concentrations under potato in 2007-08 were in Rangpur and Rajshahi (178,114 and
172,091 ha, respectively), showing a steep rise in area under potato cultivation from
08 (Figure 10). The expansion of the potato cultivation area in the northern districts,
Rangpur, Dinajpur, Thakurgaon and Rajshahi is mainly due to the availability of land at
relatively lower lease value leading to lower costs of production.
2001-02 2002-03 2003-04 2004-05 2007-08
Year
DhakaMymensinghComilla
Sylhet Chittagong Chittagong Hill Tract Rajshahi
RangpurJessoreBarisal
20
in different regions of the country in 2000-01 to
08 and 137 ha in 2008-09).
e Dhaka region, particularly Munshiganj, which is generally known as the potato production
dually losing its importance in terms of area coverage in potato whereas
the DAE’s data, the
08 were in Rangpur and Rajshahi (178,114 and
from 2004-05 to
potato cultivation area in the northern districts,
availability of land at
2007-08 2008-09
Yield and Yield Variation 309
310
Potato is a short duration crop in Bangladesh and its yield is relatively low 311
climatic limitations. The current national average yield of potato in Bangladesh is about 15 312
MT/ha, as compared to that of more than 40 MT/ha 313
temperate region (Figure 11). In the potato growing countries of the temperate region, potatoes 314
are grown during a long growing period 315
temperature, resulting in high accumulation of photosynthate in the tubers, ultimately leading to 316
high yields. 317
318
Figure 11. Yield of potato in Bangladesh compared to some other top potato growing countries 319
of the world in 2007. (Source: FAOSTAT)320
321
Potato yields vary widely among the potato growing areas of Bangladesh. Table 1 shows the 322
yields in different regions of the country 323
Services Wing of DAE. 324
325
45.37 44.72 44.58
0
5
10
15
20
25
30
35
40
45
50
France
6et
herla
nds
USA
Ger
man
y
Yie
ld (
mt/
ha
)
Potato is a short duration crop in Bangladesh and its yield is relatively low y mainly
climatic limitations. The current national average yield of potato in Bangladesh is about 15
MT/ha, as compared to that of more than 40 MT/ha in many potato growing countries of the
temperate region (Figure 11). In the potato growing countries of the temperate region, potatoes
are grown during a long growing period in summer with long sunny days and
resulting in high accumulation of photosynthate in the tubers, ultimately leading to
Yield of potato in Bangladesh compared to some other top potato growing countries
of the world in 2007. (Source: FAOSTAT)
widely among the potato growing areas of Bangladesh. Table 1 shows the
in different regions of the country from 2000-01 to 2008-09, as reported by the Field
44.5842.34
40.19
24.95
21.19 20.7
14.97 14.9213.14 12.89 12.66
Ger
man
yU
KIr
an
Belar
us
Polan
d
Ban
glad
esh
India
Ukr
aine
Rus
sia
Chi
na
21
y mainly owing to
climatic limitations. The current national average yield of potato in Bangladesh is about 15
in many potato growing countries of the
temperate region (Figure 11). In the potato growing countries of the temperate region, potatoes
long sunny days and a moderate cool
resulting in high accumulation of photosynthate in the tubers, ultimately leading to
Yield of potato in Bangladesh compared to some other top potato growing countries
widely among the potato growing areas of Bangladesh. Table 1 shows the
09, as reported by the Field
12.66
Chi
na
Table 1. Yield of potato in different regions of the country 326
2007-08 to 2008 -09 327
328
Region
2000-01 2001
Dhaka 23.25 22.77
Mymensingh 8.84 9.27
Comilla 16.27 12.59
Sylhet 9.17 9.34
Chittagong 13.60 11.53
Chittagong
Hill Tract 8.11 8.08
Rajshahi 7.23 7.69
Rangpur 10.38 8.77
Jessore 14.47 16.59
Barisal 11.19 10.08
6ational
(Average) 12.59 11.98
Source: Field Services Wing, DAE329
330
Interestingly, the yield of potato in Munshiganj district (fall331
than that of a few temperate countries of the world like Belarus, Poland and Iran (Table 1 and 332
Figure 11). 333
334
Potato cultivation 335
336
Yield of potato in different regions of the country from 2000-01 to 2004
Yield (MT/Ha)
2001-02 2002-03 2003-04 2004-05 2007-08
22.77 23.35 23.81 25.55 25.83
9.27 9.35 9.57 10.22 13.83
12.59 16.26 16.33 16.61 18.80
9.34 9.10 8.30 8.90 9.71
11.53 10.90 11.80 11.60 14.53
8.08 7.92 8.22 9.42 14.82
7.69 9.69 11.31 12.79 15.48
8.77 13.21 13.96 15.11 17.96
16.59 16.50 16.93 18.06 17.38
10.08 10.14 9.97 10.85 20.72
11.98 13.75 14.39 15.08 17.75
: Field Services Wing, DAE
Interestingly, the yield of potato in Munshiganj district (falling under Dhaka region) is higher
few temperate countries of the world like Belarus, Poland and Iran (Table 1 and
22
01 to 2004-05 and from
Yield (MT/Ha)
08 2008-09
25.83 25.43
13.83 13.68
18.80 17.95
9.71 9.62
14.53 14.03
14.82 12.92
15.48 12.09
17.96 14.21
17.38 14.56
20.72 18.04
17.75 14.54
under Dhaka region) is higher
few temperate countries of the world like Belarus, Poland and Iran (Table 1 and
Potato is cultivated in the winter season. The first fortnight of November is the right time for 337
plantation. However, in certain north338
harvest the crop early. Mulching339
etc. to preserve soil moisture and to prevent the growth of weeds. As the potato plants become 340
mature and the tubers are fully formed, the leaves become gradually yellowish and then 341
brownish, and finally the plants die. It is always better to harvest the crop after these signs are 342
evident in the field. Most varieties are harvested in this country during February343
Collection of the tubers is usually done manually using a spade or other d344
345
Potato Varieties and Grades 346
347
Diamante is the most widely grown potato variety in most of the potato growing districts 348
followed by Granola, Cardinal, Multa, Binella and Felsina. Other varieties grown in different 349
potato growing zones are Asterix, P350
among them, mostly the Granola variety is currently being exported because of its appearance, 351
taste and size. There are two different grades for exportable potato (Granola)352
tubers/kg and Grade B: 7-10 tubers/kg. The bigger the size of the tubers, the 353
The average C&F value per MT of potatoes in 2007 was USD 240 and in 2008, it was USD 250 354
for Singapore and USD 265 for Malaysia. It is 355
season (February-April), the wholesale price of potato in the local market is as low as USD 80 356
per MT and it rises up to USD 280 per MT during November357
358
State Support 359
360
The potato sector receives a considerable amount of state patronage 361
potato now enjoys 20% cash incentive on export value in order for Bangladeshi potato to become 362
6 In agriculture and gardening, mulch is a protective cover placed over the provide nutrients, and suppress weed growth and seed germination; Source: Wikipedia
Potato is cultivated in the winter season. The first fortnight of November is the right time for
plantation. However, in certain north-western areas, farmers even plant potato in October to
harvest the crop early. Mulching6 is frequently done over the rows with water hyacinth, straw
soil moisture and to prevent the growth of weeds. As the potato plants become
mature and the tubers are fully formed, the leaves become gradually yellowish and then
, and finally the plants die. It is always better to harvest the crop after these signs are
evident in the field. Most varieties are harvested in this country during February
Collection of the tubers is usually done manually using a spade or other devices.
Diamante is the most widely grown potato variety in most of the potato growing districts
followed by Granola, Cardinal, Multa, Binella and Felsina. Other varieties grown in different
potato growing zones are Asterix, Patronese, Provento, Ultra, Heera and Dheera. However,
Granola variety is currently being exported because of its appearance,
taste and size. There are two different grades for exportable potato (Granola)
10 tubers/kg. The bigger the size of the tubers, the
The average C&F value per MT of potatoes in 2007 was USD 240 and in 2008, it was USD 250
for Singapore and USD 265 for Malaysia. It is important to mention that, during peak harvesting
wholesale price of potato in the local market is as low as USD 80
per MT and it rises up to USD 280 per MT during November-December.
considerable amount of state patronage for export
potato now enjoys 20% cash incentive on export value in order for Bangladeshi potato to become
is a protective cover placed over the soil to retain moisture, reduce erosion, provide nutrients, and suppress weed growth and seed germination; Source: Wikipedia
23
Potato is cultivated in the winter season. The first fortnight of November is the right time for
western areas, farmers even plant potato in October to
is frequently done over the rows with water hyacinth, straw,
soil moisture and to prevent the growth of weeds. As the potato plants become
mature and the tubers are fully formed, the leaves become gradually yellowish and then
, and finally the plants die. It is always better to harvest the crop after these signs are
evident in the field. Most varieties are harvested in this country during February-March.
Diamante is the most widely grown potato variety in most of the potato growing districts
followed by Granola, Cardinal, Multa, Binella and Felsina. Other varieties grown in different
atronese, Provento, Ultra, Heera and Dheera. However,
Granola variety is currently being exported because of its appearance,
taste and size. There are two different grades for exportable potato (Granola): Grade A: 4-6
10 tubers/kg. The bigger the size of the tubers, the higher the price.
The average C&F value per MT of potatoes in 2007 was USD 240 and in 2008, it was USD 250
to mention that, during peak harvesting
wholesale price of potato in the local market is as low as USD 80
exports. The export of
potato now enjoys 20% cash incentive on export value in order for Bangladeshi potato to become
to retain moisture, reduce erosion,
competitive in the global market. However, farmers do not 363
exporters do. But exporters become more price364
more due to the cash incentive. With increased volume365
increases in the local market and farmers366
367
Mapping the Value Chain 368
369
Product Flow and Value Chain Actors370
371
From production to consumption, export and processing of potato, different actors are involved 372
in the potato sector. Among the public sector organizations, 373
(TCRC) of the Bangladesh Agricultural Research Institute (BARI) and Bangladesh Agricultural 374
Development Corporation (BADC) are involved in research, technology development, variety 375
development, seed production and promotional376
individuals and NGOs are involved in the production and marketing of potatoes. 377
diagram shows the core process involving different actors in the potato value chain. The 378
subsequent sections describe the role of different actors in the process.379
380
381
382
383
384
385
386
387
388
389
390
Inp
ut
Su
pp
lie
rs
Gro
we
rs/
Fa
rme
rs
global market. However, farmers do not receive the incentive directly but
exporters do. But exporters become more price-competitive in the global market and can export
more due to the cash incentive. With increased volumes of exports, the demand for potato
local market and farmers usually get a better price.
Product Flow and Value Chain Actors
From production to consumption, export and processing of potato, different actors are involved
in the potato sector. Among the public sector organizations, the Tuber Crops Research Centre
(TCRC) of the Bangladesh Agricultural Research Institute (BARI) and Bangladesh Agricultural
Development Corporation (BADC) are involved in research, technology development, variety
development, seed production and promotional activities in potato. Private companies,
individuals and NGOs are involved in the production and marketing of potatoes.
diagram shows the core process involving different actors in the potato value chain. The
e role of different actors in the process.
Traders/Bepari
Cold Storage Owners
Arotdars (Wholesalers)
Processors
Exporters
Retailer
24
the incentive directly but
global market and can export
demand for potato
From production to consumption, export and processing of potato, different actors are involved
he Tuber Crops Research Centre
(TCRC) of the Bangladesh Agricultural Research Institute (BARI) and Bangladesh Agricultural
Development Corporation (BADC) are involved in research, technology development, variety
n potato. Private companies,
individuals and NGOs are involved in the production and marketing of potatoes. The following
diagram shows the core process involving different actors in the potato value chain. The
391
392
393
394
395
396
397
Figure 12. 398
399
Input Suppliers 400
401
Four major inputs are required in potato cultivation. These are seed402
fertilizers and irrigation. Among them, seed is the most important and vital input. Considering 403
potato production in about 400,000 ha of land in 2007404
annual requirement of seed potato in Bangladesh is about 600,000 MT. But, the supply of high 405
quality seed potatoes in the country is only about 6% of the total requirement406
locally produced seed potato is 1%, private sector’s locally produced seed potato is 2% and 407
private sector’s imported seed potato is 3% (Figure 10). The 408
seed potatoes, which were harvested in preceding season from table potato crop of the potato 409
growers and preserved in cold storage410
7 Standard rate recommended by DAE
Figure 12. Core Process and Value Chain Actors
Four major inputs are required in potato cultivation. These are seed, crop protection materials,
fertilizers and irrigation. Among them, seed is the most important and vital input. Considering
production in about 400,000 ha of land in 2007-08 and a seed rate of 1.5 MT/Ha
annual requirement of seed potato in Bangladesh is about 600,000 MT. But, the supply of high
quality seed potatoes in the country is only about 6% of the total requirement; of which, BADC’s
locally produced seed potato is 1%, private sector’s locally produced seed potato is 2% and
private sector’s imported seed potato is 3% (Figure 10). The balance 94% is farmers’ retained
seed potatoes, which were harvested in preceding season from table potato crop of the potato
growers and preserved in cold storage.
25
, crop protection materials,
fertilizers and irrigation. Among them, seed is the most important and vital input. Considering
08 and a seed rate of 1.5 MT/Ha7, the
annual requirement of seed potato in Bangladesh is about 600,000 MT. But, the supply of high
; of which, BADC’s
locally produced seed potato is 1%, private sector’s locally produced seed potato is 2% and
94% is farmers’ retained
seed potatoes, which were harvested in preceding season from table potato crop of the potato
411
Figure 13. Supply of quality seed potato (6%) in Bangladesh from different sources, compared 412
to farmers' seed (94%) in 2008413
414
In general, the application of the 415
perception that a higher seed rate would result in higher yield416
germination of seed can be offset this way. 417
418
There is no special type of fertilizer 419
crops is also used in potato production. 420
organic fertilizers. Apart from organic manure, 421
shops that are available in all village markets. But adulteration of fertilizer is commonplace and 422
farmers suffer from increased production cost423
fertilizer is generally lower than the recommended dose of 10 MT/ha424
organic manure like cow dung, farm manure and compost is the main reason for 425
of organic fertilizer. 426
427
Crop protection materials include fungicides, insecticides and bactericides. Application of such 428
materials is very common among 429
8 Recommended by DAE
BADC
Supply of quality seed potato (6%) in Bangladesh from different sources, compared
o farmers' seed (94%) in 2008-09. (Source: Hussain, 2008)
the seed rate is higher than recommended. Farmers have a common
higher seed rate would result in higher yields and also loss through failed
ion of seed can be offset this way.
special type of fertilizer as such for potato only. Fertilizer used in other agricultural
also used in potato production. Common fertilizers are urea, MOP, TSP, NPK and
organic fertilizers. Apart from organic manure, the rest of the fertilizer is sold in input retail
shops that are available in all village markets. But adulteration of fertilizer is commonplace and
fer from increased production costs due to over application of them. Use of organic
fertilizer is generally lower than the recommended dose of 10 MT/ha8. The limited availability of
organic manure like cow dung, farm manure and compost is the main reason for
Crop protection materials include fungicides, insecticides and bactericides. Application of such
among potato farmers for curing and also protect
1%3%
94%
2%
BADC Private sector Imported Farmers' seed
26
Supply of quality seed potato (6%) in Bangladesh from different sources, compared
seed rate is higher than recommended. Farmers have a common
and also loss through failed
used in other agricultural
Common fertilizers are urea, MOP, TSP, NPK and
rest of the fertilizer is sold in input retail
shops that are available in all village markets. But adulteration of fertilizer is commonplace and
due to over application of them. Use of organic
imited availability of
organic manure like cow dung, farm manure and compost is the main reason for the lower dose
Crop protection materials include fungicides, insecticides and bactericides. Application of such
protecting their crops.
There are many companies and 430
there are as many as 103 brands of registered fungicides in the country recommended against the 431
late blight disease of potato9. Farmers use different types of crop protection materials 432
(fungicides, bactericides, insecticides) at least 4433
Not all the products are of good quality and farmers very often complain about them. These crop 434
protection materials are marketed by private companies and sold through 435
all village markets. 436
437
Irrigation is another essential input for potato cultivation. On average, farmers apply irrigation 438
three times in a cultivation period. Well439
on their land. Small farmers usually buy water from other neighbo440
irrigation facilities. 441
442
Potato Growers 443
444
Potato growers or farmers usually play a unitary role445
through traders and cold storage owners. However, a small portion of growers play 446
of producer and trader. Most growers are447
households in Bangladesh, about 80% are small farmers (land holding less than 0.2 ha) and some 448
of these farmers are landless 10(BBS, 2007). 449
growers as such. Potato is considered 450
vegetable growers in 2008 was 1,260,000. 451
452
Traders (Bepari) 453
454
9 List of Registered Agricultural & Public Health Pesticides in Bangladesh. PlaKhamarbari, Dhaka. 2008. 67 p 10 BBS 2007
many companies and many brands of such crop protection materials. For example,
there are as many as 103 brands of registered fungicides in the country recommended against the
. Farmers use different types of crop protection materials
s, bactericides, insecticides) at least 4-5 times during the whole cultivation process.
Not all the products are of good quality and farmers very often complain about them. These crop
protection materials are marketed by private companies and sold through dealers and retailers in
Irrigation is another essential input for potato cultivation. On average, farmers apply irrigation
three times in a cultivation period. Well-off farmers have their own irrigation pump
Small farmers usually buy water from other neighbouring farmers who have
usually play a unitary role—producing potato and selling them
through traders and cold storage owners. However, a small portion of growers play
. Most growers are, however, smallholders. Of the 12 million farm
about 80% are small farmers (land holding less than 0.2 ha) and some
(BBS, 2007). No specific data is available of the number of potato
growers as such. Potato is considered a vegetable and according to BBS, the number of
in 2008 was 1,260,000.
List of Registered Agricultural & Public Health Pesticides in Bangladesh. Plant Protection Wing, DAE,
27
many brands of such crop protection materials. For example,
there are as many as 103 brands of registered fungicides in the country recommended against the
. Farmers use different types of crop protection materials
5 times during the whole cultivation process.
Not all the products are of good quality and farmers very often complain about them. These crop
dealers and retailers in
Irrigation is another essential input for potato cultivation. On average, farmers apply irrigation
off farmers have their own irrigation pumps and engines
ring farmers who have
producing potato and selling them
through traders and cold storage owners. However, a small portion of growers play the dual role
smallholders. Of the 12 million farm
about 80% are small farmers (land holding less than 0.2 ha) and some
number of potato
and according to BBS, the number of
nt Protection Wing, DAE,
Traders, locally called Bepari, are non455
number of traders varies from 10456
large volume of potato and some 457
traders are potato growers as well. The458
storage owners, arotdars and also retailers. 459
460
Arotdars 461
462
Arotdar, a Bangla term, is a commission agent who has a fixed establishment in the market 463
place. The number of arotdars 464
arotdars deal in other agricultural commodities as well. Like traders465
potato. They conduct their business in aggregation markets and sometimes in the premises of the 466
cold storage. They let sellers bring their merchandise in467
to buy. Thus they offer a physical platform for buyers and sellers to negotiate. They have a few 468
hired laborers or part-time or full469
weighing, sorting, grading, cleaning470
transaction takes place. Sometimes, they also become buyers of the goods brought to their 471
premises. They are licensed traders with warehouses. In general, 472
in a large geographic area between the points of production and consumption. 473
474
Cold Storage Owners 475
476
Cold storage owners are entrepreneurs who own one or more cold storage facilities generally for 477
storing potatoes. Cold storage saves 478
table potatoes in the market. Farmers’ seed potatoes are also preserved in cold storage. Most cold 479
store owners are also involved in potato trading. They buy and store potatoes during the potato 480
harvesting season, and sell the stored potatoes mostly to the traders at a later stage.481
482
are non-licensed business people in the production areas. The
number of traders varies from 10-15 in each rural aggregation market. They handle
some amounts of other agricultural commodities. Some of th
are potato growers as well. They purchase potato from the growers and sell it to cold
and also retailers.
, a Bangla term, is a commission agent who has a fixed establishment in the market
also varies from 15-25 in rural aggregation markets. Usually,
other agricultural commodities as well. Like traders, some arotdars
potato. They conduct their business in aggregation markets and sometimes in the premises of the
bring their merchandise into their premises where buyers also visit
to buy. Thus they offer a physical platform for buyers and sellers to negotiate. They have a few
time or full-time salaried persons to perform various functions such as
ing, cleaning, etc. Arotdars charge a commission from the buyers if
transaction takes place. Sometimes, they also become buyers of the goods brought to their
premises. They are licensed traders with warehouses. In general, arotdars distribute commodi
in a large geographic area between the points of production and consumption.
Cold storage owners are entrepreneurs who own one or more cold storage facilities generally for
saves potatoes from spoilage and ensures a year round supply of
table potatoes in the market. Farmers’ seed potatoes are also preserved in cold storage. Most cold
owners are also involved in potato trading. They buy and store potatoes during the potato
harvesting season, and sell the stored potatoes mostly to the traders at a later stage.
28
licensed business people in the production areas. The
15 in each rural aggregation market. They handle a relatively
other agricultural commodities. Some of these
purchase potato from the growers and sell it to cold
, a Bangla term, is a commission agent who has a fixed establishment in the market
25 in rural aggregation markets. Usually,
rotdars also produce
potato. They conduct their business in aggregation markets and sometimes in the premises of the
their premises where buyers also visit
to buy. Thus they offer a physical platform for buyers and sellers to negotiate. They have a few
time salaried persons to perform various functions such as
charge a commission from the buyers if a
transaction takes place. Sometimes, they also become buyers of the goods brought to their
distribute commodities
Cold storage owners are entrepreneurs who own one or more cold storage facilities generally for
year round supply of
table potatoes in the market. Farmers’ seed potatoes are also preserved in cold storage. Most cold
owners are also involved in potato trading. They buy and store potatoes during the potato
harvesting season, and sell the stored potatoes mostly to the traders at a later stage.
The number of cold storage plants 483
number increased to 340 due to 484
Considering the total cold storage485
nearly 25-30% of the total potatoes produced in the country can be preserved in the cold 486
storage. But still, in some areas of the country and in some poor production years, a certain 487
portion of the cold storage space remains unutilized (Figure 14). 488
another reason for this underutilization. 489
490
Table 2. Utilization of space in some cold storage
2009 (Figures in parenthesis are the number of cold storage
491
1.Munshiganj (45)
2. Chandpur (6)
3. Comilla (7)
4. Bogra (6)
5. Joypurhat (4)
6. Rangpur (8)
7. Lalmonirhat (2)
8. Nilphamari (4)
9. Dinajpur (4)
10. Thakurgaon (2)
11. Rajshahi (8)
12. Kushtia (1)
13. Jessore (3)
14. Khulna (1)
plants in Bangladesh was only 77 in 1975, and in 30 years the
number increased to 340 due to the increase in potato production in the country.
Considering the total cold storage plants and production of potato in the country, at present,
30% of the total potatoes produced in the country can be preserved in the cold
. But still, in some areas of the country and in some poor production years, a certain
on of the cold storage space remains unutilized (Figure 14). Poor flow of information is
another reason for this underutilization.
Utilization of space in some cold storage plants in different areas of Bangladesh in
2009 (Figures in parenthesis are the number of cold storage plants.)
Area Utilization of cold storage space
(%)
1.Munshiganj (45) 89
2. Chandpur (6) 80
3. Comilla (7) 88
4. Bogra (6) 84
5. Joypurhat (4) 47
Rangpur (8) 100
7. Lalmonirhat (2) 79
8. Nilphamari (4) 78
9. Dinajpur (4) 74
10. Thakurgaon (2) 100
11. Rajshahi (8) 99
12. Kushtia (1) 47
13. Jessore (3) 71
14. Khulna (1) 81
29
nd in 30 years the
increase in potato production in the country.
and production of potato in the country, at present,
30% of the total potatoes produced in the country can be preserved in the cold
. But still, in some areas of the country and in some poor production years, a certain
oor flow of information is
different areas of Bangladesh in
15. Chittagong (3)
Bangladesh (105)
Source: 492
493
Figure 14. Number of cold storage494
to 2009 (Source: Bangladesh Cold Storage Association, Dhaka).495
496
Most of the cold storage space is normally utilized by potato traders, although in some areas, 497
potato growers are the major clients of cold stores such as in the northern part of Bangladesh. In 498
most of these areas (e.g., Rajshahi, Bogra, Rangpur), cold sto499
production of potatoes providing credit support and each of the growers 500
production takes lease of a large area of land for potato cultivation. 501
502
The cold storage facilities are not uniformly distributed 503
the clients for the storage of potatoes (traders and growers) is therefore not similar in all areas. 504
As a result, the cold storage charge per bag of potatoes is also not the same in all areas, e.g., the 505
charge is USD 3 per bag in Rangpur and USD 2 per bag in Bogra. Cold stored potatoes start 506
coming out from May and continue till the next harvest. Usually, most of the cold stor507
(77) (110)
0
500
1000
1500
2000
2500
Amount (000 mt)
1975
1980
15. Chittagong (3) 27
Bangladesh (105) 90
Source: Bangladesh Cold Storage Association
Number of cold storage plants and quantity of potato stored in Bangladesh
: Bangladesh Cold Storage Association, Dhaka).
Most of the cold storage space is normally utilized by potato traders, although in some areas,
potato growers are the major clients of cold stores such as in the northern part of Bangladesh. In
most of these areas (e.g., Rajshahi, Bogra, Rangpur), cold storage owners organize
production of potatoes providing credit support and each of the growers in
lease of a large area of land for potato cultivation.
The cold storage facilities are not uniformly distributed throughout the country. The pressure of
the clients for the storage of potatoes (traders and growers) is therefore not similar in all areas.
As a result, the cold storage charge per bag of potatoes is also not the same in all areas, e.g., the
3 per bag in Rangpur and USD 2 per bag in Bogra. Cold stored potatoes start
coming out from May and continue till the next harvest. Usually, most of the cold stor
(110)
(168)(170)
(260)
(270)
(320)(330)
(334) (340)
1980
1985
1990
1997
1998
2005
2007
2008
2009
Year
Total Capacity
Potato Stored
30
and quantity of potato stored in Bangladesh from 1975
: Bangladesh Cold Storage Association, Dhaka).
Most of the cold storage space is normally utilized by potato traders, although in some areas,
potato growers are the major clients of cold stores such as in the northern part of Bangladesh. In
rage owners organize the
in such organized
throughout the country. The pressure of
the clients for the storage of potatoes (traders and growers) is therefore not similar in all areas.
As a result, the cold storage charge per bag of potatoes is also not the same in all areas, e.g., the
3 per bag in Rangpur and USD 2 per bag in Bogra. Cold stored potatoes start
coming out from May and continue till the next harvest. Usually, most of the cold stores become
empty by December-January since after May, there are only cold stored potatoes an508
harvests. However, the cold storage509
510
Another approach of the cold storage owners 511
potatoes of the growers or traders to the cold stor512
of say, USD 0.15 per bag as commission. The potato traders and growers in some areas513
loans from cold storage owners for the storage of their potatoes where stored potatoes work as 514
collateral. The study found that cold storage owners take loans from banks at around14% interest 515
and disburse them to the potato traders and growers at a relatively higher rate of interest (say 516
18%). 517
518
The supply of non-cold stored potatoes remains high during and immediately519
period of harvest (February-May). Normally, cold stor520
and continue releasing up to November or December, depending on 521
of the potatoes released in October and Novembe522
523
Processors 524
525
The present state of potato processing in Bangladesh is not 526
considered as transitional. A few years back, four potato flake527
country. But none of them are 528
Constant increases of potato prices in the wholesale market 529
plants for indefinite periods. As per the capacity, each factory could utilize about 50,000 MT of 530
fresh potatoes as raw material every year. Figure 15 shows that the potato wholesale price has 531
doubled within five years since 2005. 532
the intervals in the horizontal axis are not uniform. But it clearly shows that the price increase 533
has been significantly high in recent years. 534
535
January since after May, there are only cold stored potatoes an
age charge is levied once for the whole season.
Another approach of the cold storage owners in some areas is to appoint agents, who bring
potatoes of the growers or traders to the cold stores for preservation, and in return get an amount
USD 0.15 per bag as commission. The potato traders and growers in some areas
loans from cold storage owners for the storage of their potatoes where stored potatoes work as
nd that cold storage owners take loans from banks at around14% interest
to the potato traders and growers at a relatively higher rate of interest (say
cold stored potatoes remains high during and immediately
May). Normally, cold stores start releasing potatoes in June or July,
and continue releasing up to November or December, depending on the market situation. A part
of the potatoes released in October and November is used as seed.
of potato processing in Bangladesh is not very encouraging, but
considered as transitional. A few years back, four potato flake industries were established in the
are in operation now, mostly due to lack of operational capital.
of potato prices in the wholesale market forced them to shut down their
plants for indefinite periods. As per the capacity, each factory could utilize about 50,000 MT of
fresh potatoes as raw material every year. Figure 15 shows that the potato wholesale price has
since 2005. It shows the wholesale price increase since 1955 though
the intervals in the horizontal axis are not uniform. But it clearly shows that the price increase
has been significantly high in recent years.
31
January since after May, there are only cold stored potatoes and no fresh
some areas is to appoint agents, who bring the
preservation, and in return get an amount
USD 0.15 per bag as commission. The potato traders and growers in some areas receive
loans from cold storage owners for the storage of their potatoes where stored potatoes work as
nd that cold storage owners take loans from banks at around14% interest
to the potato traders and growers at a relatively higher rate of interest (say
cold stored potatoes remains high during and immediately after the peak
es start releasing potatoes in June or July,
market situation. A part
encouraging, but it can be
industries were established in the
now, mostly due to lack of operational capital.
forced them to shut down their
plants for indefinite periods. As per the capacity, each factory could utilize about 50,000 MT of
fresh potatoes as raw material every year. Figure 15 shows that the potato wholesale price has
the wholesale price increase since 1955 though
the intervals in the horizontal axis are not uniform. But it clearly shows that the price increase
536
Figure 15. Average wholesale price of potato in Bangladesh (2009 price is up to June) 537
(Source: DAM) 538
539
A number of processing companies are now making frozen French fries, chips and other snacks 540
using potato as a raw material. Some of these processing companies are Bombay Sweets & Co. 541
Ltd., Ejab Foods Ltd., Ispahani Ltd., Zoha Chips Factory and Crisp Factory of Bhai Bhai Group. 542
As regards the use of potato by different processing companies, the543
domestic market for French fries of around 80544
the global market for flakes and starch, growing at a rate of 10% yearly, is over USD 20 billion 545
(The Financial Express, 7 May 2008). A546
Bangladesh, including the widely547
cases, potato processors are handicapped by a 548
549
The range of quality snacks, frozen food products and ethnic snacks produced by different food 550
companies consists of more than 25 items including potato, corn, cereal551
pulses. Some of these food companies 552
0
200
400
600
800
1000
1200
1400
1600
1800
Tk/1
00 k
g
1955
1960
age wholesale price of potato in Bangladesh (2009 price is up to June)
A number of processing companies are now making frozen French fries, chips and other snacks
using potato as a raw material. Some of these processing companies are Bombay Sweets & Co.
Ltd., Ejab Foods Ltd., Ispahani Ltd., Zoha Chips Factory and Crisp Factory of Bhai Bhai Group.
use of potato by different processing companies, there exists a significant
domestic market for French fries of around 80-100 thousand MT per year. Moreover, the size of
flakes and starch, growing at a rate of 10% yearly, is over USD 20 billion
(The Financial Express, 7 May 2008). As reported, most of the existing potato varieties of
Bangladesh, including the widely-grown varieties, are not suitable for industrial use. In most
handicapped by a lack of processing-type varieties.
range of quality snacks, frozen food products and ethnic snacks produced by different food
companies consists of more than 25 items including potato, corn, cereal-based products, nuts and
pulses. Some of these food companies in Bangladesh (such as Bombay Sweets & Co. Ltd., Ejab
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2006
2007
2008
2009
Year
32
age wholesale price of potato in Bangladesh (2009 price is up to June)
A number of processing companies are now making frozen French fries, chips and other snacks
using potato as a raw material. Some of these processing companies are Bombay Sweets & Co.
Ltd., Ejab Foods Ltd., Ispahani Ltd., Zoha Chips Factory and Crisp Factory of Bhai Bhai Group.
re exists a significant
100 thousand MT per year. Moreover, the size of
flakes and starch, growing at a rate of 10% yearly, is over USD 20 billion
s reported, most of the existing potato varieties of
grown varieties, are not suitable for industrial use. In most
range of quality snacks, frozen food products and ethnic snacks produced by different food
based products, nuts and
Bangladesh (such as Bombay Sweets & Co. Ltd., Ejab
2009
Foods Ltd.) have sister organizations for the production of raw materials. They mainly cultivate 553
agricultural products either under 554
system. They provide potato seed to their contract farmers to ensure quality output, monitor and 555
supervise the production and also undertake training program556
productivity. Their demand is much more than what they are current557
arrangements. They meet the rest of the demand by procuring from 558
traders or cold stores. 559
560
561
Exporters 562
563
Currently, there are only a few, around 8564
processed potatoes, mostly to Singapore, Malaysia and 565
Vietnam and Sri Lanka. Some of these companies are Agriconcern, Surovi Agro Industries Ltd. 566
(a sister organization of Supreme Seed Co. Ltd.), Alpha 567
Agro Resources Incorporation, 568
expanding their own contract farming system in order to ensure quality and grade demanded by 569
buyers. 570
571
Retailers 572
573
Retailers are the marketing actors between 574
traders/arotdars and consumers of potato. They 575
generally buy potatoes from arotdars576
sometimes from cold store owners and sell directly 577
to consumers. Retailers dealing 578
general, also sell different types of vegetables and spices579
consumer market. 580
Foods Ltd.) have sister organizations for the production of raw materials. They mainly cultivate
under their own management and/or under the contract growing
em. They provide potato seed to their contract farmers to ensure quality output, monitor and
supervise the production and also undertake training programmes for the farmers to enhance
productivity. Their demand is much more than what they are currently producing
rest of the demand by procuring from the open market, either from
Currently, there are only a few, around 8-10 established private companies that
processed potatoes, mostly to Singapore, Malaysia and the UAE and very recently to Russia,
Vietnam and Sri Lanka. Some of these companies are Agriconcern, Surovi Agro Industries Ltd.
(a sister organization of Supreme Seed Co. Ltd.), Alpha Agro, Eusum Agro Ltd
etc. All of these exporters have started and are gradually
expanding their own contract farming system in order to ensure quality and grade demanded by
the marketing actors between
and consumers of potato. They
arotdars, traders and
owners and sell directly
etailers dealing in potatoes, in
general, also sell different types of vegetables and spices and they exist in every agriculture
33
Foods Ltd.) have sister organizations for the production of raw materials. They mainly cultivate
contract growing
em. They provide potato seed to their contract farmers to ensure quality output, monitor and
s for the farmers to enhance
ly producing under contract
open market, either from
that export fresh or
he UAE and very recently to Russia,
Vietnam and Sri Lanka. Some of these companies are Agriconcern, Surovi Agro Industries Ltd.
., BRAC, Global
etc. All of these exporters have started and are gradually
expanding their own contract farming system in order to ensure quality and grade demanded by
n every agriculture
581
582
583
584
Information Flow in the Value Chain585
586
The field investigation shows that the 587
the growth of the sector. After a 588
other actors, were asked a wide range of questions regarding the flow of information relating to 589
planting, growing, harvesting, post590
inquiry was into how and from whom they source their information and how easily available and 591
accessible the information is. The dynamics of this uncovered information flow consisting of 592
financial assistance, inputs, price and technical know593
594
595
Information Flow in the Value Chain
The field investigation shows that the erratic information flow in the value chain
a review of the general information on the sector, farmers, among
other actors, were asked a wide range of questions regarding the flow of information relating to
planting, growing, harvesting, post-harvest processes, marketing and different services. The core
how and from whom they source their information and how easily available and
accessible the information is. The dynamics of this uncovered information flow consisting of
financial assistance, inputs, price and technical know-how is mapped in the following diagram.
Picture 1. Retailer selling table potato
34
he value chain is hampering
the general information on the sector, farmers, among
other actors, were asked a wide range of questions regarding the flow of information relating to
harvest processes, marketing and different services. The core
how and from whom they source their information and how easily available and
accessible the information is. The dynamics of this uncovered information flow consisting of
e following diagram.
Picture 1. Retailer selling table potato
596
597
Figure 13. 598
599
Price Information 600
601
Farmers receive price information from a variety of sources. They mostly get their price related 602
information from their immediate buyers such as traders and cold 603
processed potato exporters provide price information to their contract growers. Bigger growers 604
tend to explore more sources for 605
seem to take place at the local market place; however, big growers negotiate over the phone but 606
the deal is not completed until the buyer physically verifies the potatoes for weight, size, 607
uniformity, and injury status. Most farmers now see the advantage of knowing 608
Figure 13. Information flow in the value chain
Farmers receive price information from a variety of sources. They mostly get their price related
information from their immediate buyers such as traders and cold store owners. Fresh or
processed potato exporters provide price information to their contract growers. Bigger growers
for precise price information. Price negotiations by
local market place; however, big growers negotiate over the phone but
until the buyer physically verifies the potatoes for weight, size,
uniformity, and injury status. Most farmers now see the advantage of knowing the
35
Farmers receive price information from a variety of sources. They mostly get their price related
owners. Fresh or
processed potato exporters provide price information to their contract growers. Bigger growers
precise price information. Price negotiations by small growers
local market place; however, big growers negotiate over the phone but
until the buyer physically verifies the potatoes for weight, size,
the potato market
price in the Karwan bazaar and the Chalk bazaar, the major retail and wholesale markets in the 609
capital city, to enhance their bargaining power. Besides, wider expansion of telecommunication 610
networks in the country and the growing use of mobile phones ha611
check price information and price levels at different key market places throughout the country. 612
613
However, mobile operator Banglalink has introduced an Interactive Voice Response (IVR)614
service called ‘Banglalink Krishi615
of agro-goods or browse through by listening to other advertisements recorded by other callers to 616
get the necessary information. C617
finalize the deal. Information ab618
making the process easier.11 The Grameen Phone has been facilitating 619
last few years. Anyone with Internet connectivity 620
price of different products. Those who w621
a Grameen Phone subscription number.622
623
Input and Know-how Information624
625
Farmers obtain information regarding seeds from input retailers and also from extension officers. 626
From the same sources, they also receive 627
fertilizer and their use. Farmers also share information among themselves on different inputs and 628
technical issues. Besides, print media and broadcasting media also provide information 629
occasionally. The growers under contract arrangements receive input630
information from the contracting companies/exporters. Cold stor631
post-harvest- related information to farmers such as sorting, grading632
Grameenphone, the leading mobile operator, has established more than 500 Community 633
Information Centres (CIC) with 634
11 www.banglalinkgsm.com 12 www.cellbazaar.com
price in the Karwan bazaar and the Chalk bazaar, the major retail and wholesale markets in the
capital city, to enhance their bargaining power. Besides, wider expansion of telecommunication
networks in the country and the growing use of mobile phones have enabled the farmers to cross
check price information and price levels at different key market places throughout the country.
However, mobile operator Banglalink has introduced an Interactive Voice Response (IVR)
service called ‘Banglalink Krishibazaar’. It allows customers to record their own advertisements
goods or browse through by listening to other advertisements recorded by other callers to
Callers can also call up the trader instantly by pressing "8" and
bout the products is available by category, price
The Grameen Phone has been facilitating online market
with Internet connectivity can visit the website12 and check the market
Those who want to upload their merchandize on the
a Grameen Phone subscription number.
how Information
information regarding seeds from input retailers and also from extension officers.
From the same sources, they also receive information regarding crop protection material
e. Farmers also share information among themselves on different inputs and
technical issues. Besides, print media and broadcasting media also provide information
he growers under contract arrangements receive input-related and technical
information from the contracting companies/exporters. Cold store owners provide particularly
related information to farmers such as sorting, grading,
Grameenphone, the leading mobile operator, has established more than 500 Community
(CIC) with Internet connectivity in the semi-urban and rural areas of
36
price in the Karwan bazaar and the Chalk bazaar, the major retail and wholesale markets in the
capital city, to enhance their bargaining power. Besides, wider expansion of telecommunication
ve enabled the farmers to cross-
check price information and price levels at different key market places throughout the country.
However, mobile operator Banglalink has introduced an Interactive Voice Response (IVR)-based
own advertisements
goods or browse through by listening to other advertisements recorded by other callers to
trader instantly by pressing "8" and
price, location, etc.
online marketing over the
check the market
n the site need to have
information regarding seeds from input retailers and also from extension officers.
information regarding crop protection material and
e. Farmers also share information among themselves on different inputs and
technical issues. Besides, print media and broadcasting media also provide information
related and technical
owners provide particularly
, etc. Besides,
Grameenphone, the leading mobile operator, has established more than 500 Community
urban and rural areas of
Bangladesh. By visiting the CICs, farmers can 635
www.ruralinfobd.com, which is rich in agriculture636
Banglalink offers the ‘Krishi Jigyasha 7676’ service which provides 637
any queries related to agriculture, vegetable an638
To avail themselves of this service, 639
advice on the problem. 640
641
Financial Assistance 642
643
Financial assistance flows in four forms:644
• Some traders offer loans to their known growers with whom they have a 645
relationship, 646
• Input suppliers sell on credit to their known farmers,647
• Loans are given by commercial banks and NGOs (microfinance),648
• Loans are given by cold stor649
650
Transaction Costs 651
652
In order to simplify the discussion653
related disciplines, a transaction cost is a cost incurred in making an economic exchange 654
(restated: the cost of participating in a market)655
transaction costs as many variables are present. 656
and knowledge (Figure 13). Sometimes, 657
particular issue before making a 658
farmer and also according to the type of information. For example, a farmer can receive input 659
related information from other farmers, input retailers, government extension office660
13 Source: Wikipedia
Bangladesh. By visiting the CICs, farmers can access a web portal named
which is rich in agriculture-related information. On the other hand,
igyasha 7676’ service which provides suggestions and answers to
any queries related to agriculture, vegetable and fruit farming, poultry, livestock, fisheries
this service, Banglalink subscribers need to dial 7676, talk and get expert
Financial assistance flows in four forms:
Some traders offer loans to their known growers with whom they have a
Input suppliers sell on credit to their known farmers,
commercial banks and NGOs (microfinance),
old store owners.
discussion, it is important to define transaction costs. In economics and
related disciplines, a transaction cost is a cost incurred in making an economic exchange
(restated: the cost of participating in a market).13 Apparently, it is very difficult to estimate the
many variables are present. Farmers use various sources to get information
. Sometimes, they use a number of sources to get information on a
decision. Hence, the transaction cost also varies from farmer to
farmer and also according to the type of information. For example, a farmer can receive input
ted information from other farmers, input retailers, government extension office
37
a web portal named
related information. On the other hand,
suggestions and answers to
d fruit farming, poultry, livestock, fisheries, etc.
to dial 7676, talk and get expert
Some traders offer loans to their known growers with whom they have a continuous
, it is important to define transaction costs. In economics and
related disciplines, a transaction cost is a cost incurred in making an economic exchange
it is very difficult to estimate the
various sources to get information
a number of sources to get information on a
decision. Hence, the transaction cost also varies from farmer to
farmer and also according to the type of information. For example, a farmer can receive input
ted information from other farmers, input retailers, government extension offices, private
companies doing contract farming, exporters661
source to make purchase decisions and in other cases, 662
buys an input from an input retailer, then the transaction cost would only be his/her transport 663
cost to the shop in the market, may be around BDT 10 (it may also vary, if the farmer makes any 664
other purchases when he/she goes to the market). On the other hand, 665
be higher if a farmer needs to get information from a government extension officer. In many 666
cases, the transport cost to the office would be around BDT 50667
communication has reduced transport cost668
and can access the extension officer, he/she can talk over 669
transaction cost to less than BDT 10. However, it does not reflect the total transaction costs as it 670
shows only the transportation costs or phone call costs671
effort costs. In a nutshell, transaction costs for farmers672
and the effort and time to find the solution provider, in particular673
transport all of which varies from transaction to transaction. However, all these transaction costs 674
have decreased significantly now considering transportation cost 675
phones. Once a person knows the source of his/her information, he/she can make phone calls 676
and can talk for a few minutes for less 677
rural areas. However, as mentioned in the previous sections, there are 678
a few mobile operators in Bangladesh where transaction costs for making different decisions or 679
deals are very straight forward. For instance, in ‘Banglalink Krishibazaar’, a farmer can record 680
his/her product details with a service charge of BDT681
farmer is able to record his complete product profile in two minutes and 682
products from the seller’s place, then the transaction cost of selling his goods would be only 683
BDT 2. In Banglalink ‘Krishi Jigyasha’, when a farmer speaks to 684
his/her queries, he/she has to pay B685
other operators’ subscribers. However, this discussion only narrowly tried to identify transaction 686
14 BDT=Bangladeshi Taka, 1 USD≈74 BDT (www.xe.com)
companies doing contract farming, exporters, etc. In certain cases, farmers may use a single
source to make purchase decisions and in other cases, they may use several sources. If a farmer
an input retailer, then the transaction cost would only be his/her transport
cost to the shop in the market, may be around BDT 10 (it may also vary, if the farmer makes any
other purchases when he/she goes to the market). On the other hand, the transactio
be higher if a farmer needs to get information from a government extension officer. In many
cases, the transport cost to the office would be around BDT 50-100. However, mobile
transport costs significantly. If the farmer has the mobile number
the extension officer, he/she can talk over the phone which would bring down the
to less than BDT 10. However, it does not reflect the total transaction costs as it
shows only the transportation costs or phone call costs, and not other variables such as time and
effort costs. In a nutshell, transaction costs for farmers mostly include the cost of information
the effort and time to find the solution provider, in particular, the associated cost of
transport all of which varies from transaction to transaction. However, all these transaction costs
significantly now considering transportation cost to be the cost
phones. Once a person knows the source of his/her information, he/she can make phone calls
and can talk for a few minutes for less than BDT 10. Mobile phones are also available now in
rural areas. However, as mentioned in the previous sections, there are a few specific services by
a few mobile operators in Bangladesh where transaction costs for making different decisions or
very straight forward. For instance, in ‘Banglalink Krishibazaar’, a farmer can record
his/her product details with a service charge of BDT14 1 per minute (excluding VAT). If the
farmer is able to record his complete product profile in two minutes and later someone buys his
seller’s place, then the transaction cost of selling his goods would be only
BDT 2. In Banglalink ‘Krishi Jigyasha’, when a farmer speaks to an expert and get
his/her queries, he/she has to pay BDT 2 per minute for a Banglalink subscriber and BDT 5 for
other operators’ subscribers. However, this discussion only narrowly tried to identify transaction
74 BDT (www.xe.com)
38
may use a single
use several sources. If a farmer
an input retailer, then the transaction cost would only be his/her transport
cost to the shop in the market, may be around BDT 10 (it may also vary, if the farmer makes any
transaction cost would
be higher if a farmer needs to get information from a government extension officer. In many
100. However, mobile
. If the farmer has the mobile number
phone which would bring down the
to less than BDT 10. However, it does not reflect the total transaction costs as it
other variables such as time and
cost of information
the associated cost of
transport all of which varies from transaction to transaction. However, all these transaction costs
ost of using mobile
phones. Once a person knows the source of his/her information, he/she can make phone calls
than BDT 10. Mobile phones are also available now in
few specific services by
a few mobile operators in Bangladesh where transaction costs for making different decisions or
very straight forward. For instance, in ‘Banglalink Krishibazaar’, a farmer can record
1 per minute (excluding VAT). If the
someone buys his
seller’s place, then the transaction cost of selling his goods would be only
expert and gets answers to
DT 2 per minute for a Banglalink subscriber and BDT 5 for
other operators’ subscribers. However, this discussion only narrowly tried to identify transaction
costs and cannot be concluded as the basis 687
required to measure the associated transaction costs of any economic exchange.688
689
Identified Issues in the Value Chain690
691
692
693
The overall field investigation identified a series of constraints besetting the value chain and 694
hindering its growth. Not all the identified constraints are discussed in the report as the focus of 695
the study is to identify the information and the knowledge 696
small holder farmers. Therefore, only the constraints pertaining to small holder farmers have 697
been analyzed in this section. 698
699
Lack of Knowledge of Farmers on Quality Inputs and Their Us700
701
As mentioned earlier, the price of potato has almost doubled during the period 2005702
some significant negative consequences. 703
competitive in the global market; 704
few years cannot be increased; because of increased prices, all four potato flakes industries are 705
non-operational when they could 706
facilities creates a glut of potato after harvest and consequently the price comes down to 707
low level with farmers making low profit708
Hence, continuous increases in potato price709
710
However, a primary cause of increased price711
identifying quality inputs and their application. It is true that the input cost has increased during 712
this period but the use of excess inputs in all categories (seeds, crop protection and fertilizer713
costs and cannot be concluded as the basis for estimating such costs. A thorough research is
quired to measure the associated transaction costs of any economic exchange.
Identified Issues in the Value Chain
he overall field investigation identified a series of constraints besetting the value chain and
hindering its growth. Not all the identified constraints are discussed in the report as the focus of
the study is to identify the information and the knowledge gaps in the value chain related to
small holder farmers. Therefore, only the constraints pertaining to small holder farmers have
Lack of Knowledge of Farmers on Quality Inputs and Their Use
As mentioned earlier, the price of potato has almost doubled during the period 2005
some significant negative consequences. Bangladeshi potato has become expensive or less
; its export volume even after a huge production
because of increased prices, all four potato flakes industries are
when they could have produced huge amounts; and, inadequate
glut of potato after harvest and consequently the price comes down to
low profits or even losses in a good or bumper production year.
increases in potato prices have made the potato industry vulnerable.
However, a primary cause of increased prices seems to be the lack of knowledge of farmers o
identifying quality inputs and their application. It is true that the input cost has increased during
e of excess inputs in all categories (seeds, crop protection and fertilizer
39
such costs. A thorough research is
he overall field investigation identified a series of constraints besetting the value chain and
hindering its growth. Not all the identified constraints are discussed in the report as the focus of
gaps in the value chain related to
small holder farmers. Therefore, only the constraints pertaining to small holder farmers have
As mentioned earlier, the price of potato has almost doubled during the period 2005-09 with
expensive or less
huge production rise during last
because of increased prices, all four potato flakes industries are
inadequate cold storage
glut of potato after harvest and consequently the price comes down to a very
in a good or bumper production year.
have made the potato industry vulnerable.
seems to be the lack of knowledge of farmers of
identifying quality inputs and their application. It is true that the input cost has increased during
e of excess inputs in all categories (seeds, crop protection and fertilizer)
increase production costs several 714
required. They use the same crop protection material715
product and how to apply it. Because of 716
quality products which do not work well and then they buy 717
in the case of fertilizer as adulterated fertilizer is very common in rural markets and farmers buy 718
them as they cannot recognize the difference. As a result, they have to apply more fertilizer to 719
achieve the desired yield. 720
Hence, this is clearly an extension failure. 721
can hardly reach all the farmers. Exporting and/or processing companies have started contract 722
farming whereby they provide inputs and also technical know723
to cater to the large number of farmers. In this 724
likely to minimize the limitation725
seems to be a very appropriate solution in this regard. 726
communication can also add value. Along with improving the extension services, it makes sense 727
to make farmers aware of how to 728
crop protection and fertilizer companies can arrange promotional campaigns within their 729
marketing plans which would also promote their own brands. This can be done through 730
arranging road shows, poster-billboards, TVCs and demonstrations besides mobile phones. 731
732
Lack of Knowledge of Farmers on Variety, Grading, Processing and Export Market733
734
Potato should be large, uniform in size, attractive in appearance and free from injuries for export 735
and processing industries. Granola is the most appropriate variety for 736
limited cold storage space, it is unlikely that the price will remain fair after the harvest. Hence, 737
farmers should plan their varieties in such a way so that they could find alternative markets 738
than the traditional consumer ones. In Rangpur regions, the farmers mostly grow 739
variety. The introduction of contract farming by a number of exporters and/or processing 740
companies in this region has enabled the farmers to know about the demand for 741
several fold. Farmers use poor quality seed and in excess
crop protection material repeatedly as they do not know the right
. Because of this lack of knowledge, they very often
not work well and then they buy a different product. It is not different
case of fertilizer as adulterated fertilizer is very common in rural markets and farmers buy
as they cannot recognize the difference. As a result, they have to apply more fertilizer to
is clearly an extension failure. The limited number of government extension workers
can hardly reach all the farmers. Exporting and/or processing companies have started contract
they provide inputs and also technical know-how. But their outreach is
to the large number of farmers. In this situation, the use of mobile phones could very
to minimize the limitations of physical distance. Banglalink’s ‘Krishi
seems to be a very appropriate solution in this regard. The use of SMS or MMS in
communication can also add value. Along with improving the extension services, it makes sense
how to identify better quality inputs and also their us
crop protection and fertilizer companies can arrange promotional campaigns within their
marketing plans which would also promote their own brands. This can be done through
billboards, TVCs and demonstrations besides mobile phones.
Lack of Knowledge of Farmers on Variety, Grading, Processing and Export Market
Potato should be large, uniform in size, attractive in appearance and free from injuries for export
d processing industries. Granola is the most appropriate variety for the purpose
, it is unlikely that the price will remain fair after the harvest. Hence,
farmers should plan their varieties in such a way so that they could find alternative markets
than the traditional consumer ones. In Rangpur regions, the farmers mostly grow
ntroduction of contract farming by a number of exporters and/or processing
companies in this region has enabled the farmers to know about the demand for
40
and in excess of what is
repeatedly as they do not know the right
very often buy inferior
a different product. It is not different
case of fertilizer as adulterated fertilizer is very common in rural markets and farmers buy
as they cannot recognize the difference. As a result, they have to apply more fertilizer to
imited number of government extension workers
can hardly reach all the farmers. Exporting and/or processing companies have started contract
utreach is too low
, the use of mobile phones could very
rishi jigyasha 7676’
e of SMS or MMS in
communication can also add value. Along with improving the extension services, it makes sense
better quality inputs and also their use. Quality seed,
crop protection and fertilizer companies can arrange promotional campaigns within their
marketing plans which would also promote their own brands. This can be done through
billboards, TVCs and demonstrations besides mobile phones.
Lack of Knowledge of Farmers on Variety, Grading, Processing and Export Market
Potato should be large, uniform in size, attractive in appearance and free from injuries for export
the purpose. Because of the
, it is unlikely that the price will remain fair after the harvest. Hence,
farmers should plan their varieties in such a way so that they could find alternative markets other
than the traditional consumer ones. In Rangpur regions, the farmers mostly grow the granola
ntroduction of contract farming by a number of exporters and/or processing
companies in this region has enabled the farmers to know about the demand for the granola
variety. On the other hand, Munshiganj, being a very old and one of the leading potato growing 742
regions, is still growing other varieties but not 743
744
There is another aspect of grading 745
popular varieties, can also yield 746
price after harvest remains low because of 747
bigger ones of uniform size for export748
the farmers of the requirements of exporters limits their scope to increase income. 749
750
Exporters, in this context, can promote the varieties they require and 751
the need to grade their harvest. Contract farming has shown positive results as 752
steadily increased in the last few years. Hence, 753
exporters and/or processing companies can educate the farmers on varieties and grading. 754
‘Banglalink krishibazaar’ can also provide 755
product quality, grade and price. 756
757
Lack of Knowledge of Farmers758
Techniques 759
760
Since potato is harvested manually with a little spade, 761
few potatoes can always get damaged762
harvest may also be affected by 763
curing and grading are essential before preserving them 764
in cold storage. Farmers’ lack of knowledge o765
matters results in wastage and rotting 766
process. As cold storage owners and also 767
goes bad. This ultimately affects 768
769
variety. On the other hand, Munshiganj, being a very old and one of the leading potato growing
regions, is still growing other varieties but not granola.
of grading potatoes after harvest. Diament and Cardinal,
popular varieties, can also yield rather bigger size potatoes if graded after harvest. Since the
price after harvest remains low because of a glut, farmers can grade their potatoes, separate the
uniform size for export and thus can earn a better margin. Lack of knowledge of
the requirements of exporters limits their scope to increase income.
Exporters, in this context, can promote the varieties they require and make the farmers
. Contract farming has shown positive results as
last few years. Hence, by expanding the contract farming system
exporters and/or processing companies can educate the farmers on varieties and grading.
‘Banglalink krishibazaar’ can also provide a platform for buyers and sellers to get to know about
product quality, grade and price.
Lack of Knowledge of Farmers on Post-harvest
Since potato is harvested manually with a little spade, a
can always get damaged. Some of the
affected by disease. Hence sorting,
and grading are essential before preserving them
in cold storage. Farmers’ lack of knowledge of these
results in wastage and rotting in the preservation
old storage owners and also farmers stated, approximately 5% preserved potatoes
. This ultimately affects their net return on production.
41
variety. On the other hand, Munshiganj, being a very old and one of the leading potato growing
potatoes after harvest. Diament and Cardinal, two other most
bigger size potatoes if graded after harvest. Since the
glut, farmers can grade their potatoes, separate the
and thus can earn a better margin. Lack of knowledge of
the requirements of exporters limits their scope to increase income.
e farmers aware of
. Contract farming has shown positive results as exports have
expanding the contract farming system,
exporters and/or processing companies can educate the farmers on varieties and grading.
platform for buyers and sellers to get to know about
approximately 5% preserved potatoes
770
771
772
potato 773
774
Cold storage companies can educate farmers on these issues. Before 775
educate potential customers through an information campaign. In this way, their customers 776
(farmers) will suffer little or no loss and the cold storage operators can create a better image 777
win-win service. 778
779
In addition, CICs of Grameenphone780
information to the farmers. 781
782
783
Lack of Information on Available Space in Cold 784
Storages 785
786
As mentioned earlier, only around 25787
production can be stored in around 340 cold storage 788
plants all over Bangladesh. The c789
is only a meagre portion of the790
result is an obvious glut during and immediately after 791
the harvest when the price sometimes792
in this situation, around 10% of 793
remains unfilled in some areas 794
farmers stand in long queues for few days 795
asymmetry prevails here. 796
797
Picture 2. Women harvesting
Cold storage companies can educate farmers on these issues. Before harvesting, they can
potential customers through an information campaign. In this way, their customers
little or no loss and the cold storage operators can create a better image
In addition, CICs of Grameenphone or ‘Krishi jigyasha’ of Banglalink can also provide such
Lack of Information on Available Space in Cold
As mentioned earlier, only around 25-30% of total
production can be stored in around 340 cold storage
The current export volume
portion of the total volume. The
obvious glut during and immediately after
sometimes falls even below the production cost. Unfortunately, even
in this situation, around 10% of cold storage space
while in other areas,
for few days for access to cold storage. A clear information
Picture 3. Queue in front of a cold storage
42
Picture 2. Women harvesting
harvesting, they can
potential customers through an information campaign. In this way, their customers
little or no loss and the cold storage operators can create a better image of a
rishi jigyasha’ of Banglalink can also provide such
below the production cost. Unfortunately, even
access to cold storage. A clear information
cold storage plant
In this situation, informing farmers on 798
farmer can take his/her potatoes to th799
Transportation cost is a decisive factor 800
important that the farmers get information regarding the unfilled 801
convenient distance. Cold store owners can provide such information to the farmers through a 802
variety of means such as announcement803
in rural areas) in production clusters, market places804
An ICT based solution could be 805
mobile phone numbers. Farmers can register themselves 806
After harvests, an unfilled cold store can send SMSs to the registered farmers informing 807
the space available to store potatoes.808
809
810
Conclusion 811
812
Potato consumption has increased globally and marks a shift from the developed world to the 813
developing. Bangladesh has also showed significant growth in terms of production, yield and 814
consumption in the last decade. However, 815
competitive in the global market and th816
only made Bangladeshi potato less competitive in 817
farmers from reaping sufficient profit or even 818
grading and standard post-harvest practices also lead to economic loss for the farmers. 819
Appropriate post-harvest techniques can reduce 820
period. There are only limited preservation facilities available in Bangladesh for potatoes821
still a significant part remains unused. These 822
and also the weak flow of information to823
their proper application can certainly reduce the 824
the entire value chain positively as the exporters will also be in a better situation regarding price 825
farmers on unfilled space in the cold stores can
farmer can take his/her potatoes to the particular cold store where space is available
Transportation cost is a decisive factor in the distance the farmer can travel. Hence, it is
important that the farmers get information regarding the unfilled cold storage
e owners can provide such information to the farmers through a
variety of means such as announcements through a public address system (a very popular means
) in production clusters, market places, etc, banners, “word of mouth”
An ICT based solution could be to register farmers in the surrounding areas on
mobile phone numbers. Farmers can register themselves with the cold stores prior to harvesting.
After harvests, an unfilled cold store can send SMSs to the registered farmers informing
to store potatoes.
Potato consumption has increased globally and marks a shift from the developed world to the
. Bangladesh has also showed significant growth in terms of production, yield and
consumption in the last decade. However, the sector is still struggling to become price
competitive in the global market and thus export the surplus. Increased production cost
only made Bangladeshi potato less competitive in the global market but also prevented
sufficient profit or even cover their investment costs. Lack of sorting,
harvest practices also lead to economic loss for the farmers.
harvest techniques can reduce wastage and rotting during
period. There are only limited preservation facilities available in Bangladesh for potatoes
still a significant part remains unused. These are all rooted in the poor knowledge of the farmers
e weak flow of information to them. Increased knowledge of agriculture inputs and
their proper application can certainly reduce the farmers’ cost of production. This would affect
the entire value chain positively as the exporters will also be in a better situation regarding price
43
can help. Then, the
where space is available.
the farmer can travel. Hence, it is
space within a
e owners can provide such information to the farmers through a
(a very popular means
banners, “word of mouth”, and so on.
on their respective
the cold stores prior to harvesting.
After harvests, an unfilled cold store can send SMSs to the registered farmers informing them of
Potato consumption has increased globally and marks a shift from the developed world to the
. Bangladesh has also showed significant growth in terms of production, yield and
struggling to become price
export the surplus. Increased production costs have not
prevented small
. Lack of sorting,
harvest practices also lead to economic loss for the farmers.
wastage and rotting during the preservation
period. There are only limited preservation facilities available in Bangladesh for potatoes but
rooted in the poor knowledge of the farmers
agriculture inputs and
. This would affect
the entire value chain positively as the exporters will also be in a better situation regarding price
competitiveness. With knowledge and information regarding post826
can also increase their profit by reducing wast827
which cold storage has provision828
money in a period of glut. The study analyzed all these aspects from 829
knowledge gaps perspective and tried to identify the root causes. Addressing the issues can 830
certainly improve the information and knowledge flow scenario and can ultimately lead to831
vibrant and competitive potato sector in Bangladesh.832
833
834
Appendices 835
836
Appendix 1. Selection of most p837
838
Introduction 839
840
In recent years, Bangladesh’s economy has earned 841
and with high potential. During the last couple of decades, the economy has experienced quite a 842
rapid expansion with a spectacular surge in the Ready Made Garments (RMG) sector. 843
Bangladesh exported more than $18 billion worth of goods and services in 2009 where the844
contribution of the RMG sector alone was almost 75%. Although its foreign trade still remains 845
very concentrated in only a few sectors, there are clear signs of progress in many areas. 846
Agricultural commodities are climbing up 847
export items. Although RMG export848
remains quite low – approximately 30% 849
commodities is almost 100%. The850
potential value chains: 851
. Goods that 852
a) have potential for value addition,853
knowledge and information regarding post-harvest techniques,
fit by reducing waste. If the information is available to a farmer on
which cold storage has provisions for preserving potato, he/she can save him/her from losing
. The study analyzed all these aspects from the
knowledge gaps perspective and tried to identify the root causes. Addressing the issues can
certainly improve the information and knowledge flow scenario and can ultimately lead to
vibrant and competitive potato sector in Bangladesh.
Selection of most promising export oriented agricultural value chains
In recent years, Bangladesh’s economy has earned recognition from many spectators as vibrant
. During the last couple of decades, the economy has experienced quite a
rapid expansion with a spectacular surge in the Ready Made Garments (RMG) sector.
exported more than $18 billion worth of goods and services in 2009 where the
RMG sector alone was almost 75%. Although its foreign trade still remains
very concentrated in only a few sectors, there are clear signs of progress in many areas.
Agricultural commodities are climbing up the ladder and trying to diversify the product list of
export items. Although RMG exports take a lion’s share of export earnings, its value addition
approximately 30% – while the value addition of exported agricultural
The following four major criteria were used to select the two most
have potential for value addition,
44
harvest techniques, farmers
e. If the information is available to a farmer on
, he/she can save him/her from losing
the information and
knowledge gaps perspective and tried to identify the root causes. Addressing the issues can
certainly improve the information and knowledge flow scenario and can ultimately lead to a
export oriented agricultural value chains
recognition from many spectators as vibrant
. During the last couple of decades, the economy has experienced quite a
rapid expansion with a spectacular surge in the Ready Made Garments (RMG) sector.
exported more than $18 billion worth of goods and services in 2009 where the
RMG sector alone was almost 75%. Although its foreign trade still remains
very concentrated in only a few sectors, there are clear signs of progress in many areas.
the ladder and trying to diversify the product list of
export earnings, its value addition
while the value addition of exported agricultural
used to select the two most
b. have high participation (or potential for participation) by small actors 854
SMEs, 855
c. have high export potential,856
d. have potential for increased productivity.857
858
Identifying an initial list of value chain commodities859
860
The list was largely derived from the Food and Agriculture Organization Statistics (FAOSTAT). 861
There are several categories including quantity of export, the value of the export earnings of 862
individual commodity, and unit value 863
However, the commodity Shrimp and Prawn is added separately for the sake of grouping o864
leading agro-commodities and for further assessment. Table 1 shows a total of 20 value chains 865
that have been considered in this exercise.866
867
868
Table 1. List of main exported agro869
Rank Comm Quantity
1 Shrimp** 43435***
2 Jute **
3 Tobacco, unmanufactured**
4 Vegetables fresh nes**
5 Tea**
6 Cotton Waste
7 Rice Milled
8 Nuts, nes
9 Arecanuts
10 Potatoes Flour
11 Pastry
high participation (or potential for participation) by small actors
ave high export potential,
ave potential for increased productivity.
lue chain commodities
from the Food and Agriculture Organization Statistics (FAOSTAT).
several categories including quantity of export, the value of the export earnings of
individual commodity, and unit value that are considered by FAOSTAT for the ranking.
However, the commodity Shrimp and Prawn is added separately for the sake of grouping o
commodities and for further assessment. Table 1 shows a total of 20 value chains
have been considered in this exercise.
Table 1. List of main exported agro-commodities (2008 estimate)*
Quantity Flag Value Flag Unit value
43435*** 447785
369372 R 162195 R
9490 R 30438 R
7574 R 15915 R
8259 R 14403 R
26746 R 9753 R
5445 R 4537 R
6707 R 3918 R
6290 F 3377 F
1971 F 2925 F
1943 R 2834 R
45
high participation (or potential for participation) by small actors including MSEs/
from the Food and Agriculture Organization Statistics (FAOSTAT).
several categories including quantity of export, the value of the export earnings of
considered by FAOSTAT for the ranking.
However, the commodity Shrimp and Prawn is added separately for the sake of grouping of the
commodities and for further assessment. Table 1 shows a total of 20 value chains
commodities (2008 estimate)*
Unit value
8004
350
2518
1866
1304
365
833
584
537
1484
1459
12 Rice Husked
13 Veg.in Tem. Preservatives
14 Vegetable Frozen
15 Food Prep,Flour,Malt
16 Flax Fibre Raw
17 Breakfast Cereals
18 Potatoes
19 Cotton Carded,Combed
20 Fruit Juice Nes
Source: FAOSTAT, 2008; and ITC 2008870
F : FAO estimate
R : Estimated data using trading partners database
* FAOSTAT data differs from that of ITC (which has been used in latter part of this report in 871
different situational analysis) due to adopting different methods of data collection. 872
** ITC 873
*** BBS Yearbook of Agricultural Statistics of Bangladesh 2009874
875
As the table suggests, shrimp stood as the top commodity in terms of export earnings in 2008 876
with $447.7 million followed by 877
with $23.8 million earnings, was 878
waste stood in close proximity in the earning list with $14 million, $10.7 million and $9.7 879
million respectively. Besides, there are other commodities such as potatoes with 880
contribution have also been listed some of which, although seemingly insignificant, have 881
export potential in terms of other indicators which we will explore in the latter part of the report. 882
883
Selecting 4 – 6 value chains for further 884
885
3352 R 2523 R
1104 F 2493 F
1159 R 2272 R
1121 F 1981 F
5461 F 1791 F
2061 R 1741 R
6194 R 1553 R
135 F 1275 R
3078 R 1256 R
: FAOSTAT, 2008; and ITC 2008
Estimated data using trading partners database
* FAOSTAT data differs from that of ITC (which has been used in latter part of this report in
different situational analysis) due to adopting different methods of data collection.
*** BBS Yearbook of Agricultural Statistics of Bangladesh 2009
hrimp stood as the top commodity in terms of export earnings in 2008
with $447.7 million followed by jute which earned $129.4 million in the same period. Tobacco,
was positioned third from the top while vegetables,
close proximity in the earning list with $14 million, $10.7 million and $9.7
million respectively. Besides, there are other commodities such as potatoes with
contribution have also been listed some of which, although seemingly insignificant, have
in terms of other indicators which we will explore in the latter part of the report.
6 value chains for further assessment
46
753
2258
1960
1767
328
845
224
9444
408
* FAOSTAT data differs from that of ITC (which has been used in latter part of this report in
different situational analysis) due to adopting different methods of data collection.
hrimp stood as the top commodity in terms of export earnings in 2008
ute which earned $129.4 million in the same period. Tobacco,
egetables, tea, and cotton
close proximity in the earning list with $14 million, $10.7 million and $9.7
million respectively. Besides, there are other commodities such as potatoes with a moderate
contribution have also been listed some of which, although seemingly insignificant, have huge
in terms of other indicators which we will explore in the latter part of the report.
Based on Table 1, each value chain has been assessed comparatively against the two most 886
important following criteria – participation of actors in the value chain and export potential887
those commodities. Through a short888
fewer value chains to assess against 889
890
Table 2. Leading value chains in terms of participation and export earnings 891
Rank Commodity
1 Shrimp
2 Jute
3 Tobacco
4 Vegetables (including Potato)
5 Tea
6 Potato
Sources: 892
* BBS Yearbook of Agricultural Statistics of Bangladesh 2009893
**Source: ITC 2008 894
*** included in vegetable895
896
Figure 1 shows the results of the short897
898
Figure 1. Results of the short899
Rice
High
Medium
Low
Pa
rtic
ipa
tio
n o
f a
cto
rs
Based on Table 1, each value chain has been assessed comparatively against the two most
participation of actors in the value chain and export potential
those commodities. Through a short-listing matrix exercise, the initial list is narrowed down to
against all the criteria.
Table 2. Leading value chains in terms of participation and export earnings
Commodity Export earnings
Value in 2008 (1000
$)**
Participation of
persons (000)*
447785 32
162195 154
30438 115
(including Potato) 15915 1260
14403 431
4537 4537***
* BBS Yearbook of Agricultural Statistics of Bangladesh 2009
vegetables and can be considered the same number
Figure 1 shows the results of the short-listing exercise.
Figure 1. Results of the short-listing exercise
Vegetables
Potato
Tea
Shrimp
Jute
Tobacco
47
Based on Table 1, each value chain has been assessed comparatively against the two most
participation of actors in the value chain and export potential of
e, the initial list is narrowed down to a
Table 2. Leading value chains in terms of participation and export earnings
Participation of
persons (000)*
Cereals
Cotton Waste
Fruit Juice Nes
Sesame seed
900
Low 901
902
903
Using the matrix, six value chains have been indentified and selected for additional assessment. 904
These include shrimp, jute, tobacco, 905
categories that either have a large 906
high export potential as indicated 907
either have limited export earning908
909
Finalized value chains selection910
911
For selecting the final value chains, we have discussed a couple of important factors affecting the 912
selection. Firstly, we have looked into the domestic production of those six commodities and 913
compared their productivity with 914
3). Besides, four years’ export data of the commodities ha915
annual growth rate (Table 4). Table 5 illustrates the analysis end916
exercises. 917
918
919
Mango
Fruit Juice Nes
Pastry
Nuts, nes
Arecanuts
Medium High
Using the matrix, six value chains have been indentified and selected for additional assessment.
obacco, vegetables, tea and potato. These products fall into the
a large participation of actors (including SMEs and MSMEs) or hav
as indicated in the recent export data (Table 1). The remaining value chains
either have limited export earning potential or low participation of actors.
value chains selection
For selecting the final value chains, we have discussed a couple of important factors affecting the
we have looked into the domestic production of those six commodities and
compared their productivity with that of two leading world producers – India and China (Table
four years’ export data of the commodities has been given with their comp
annual growth rate (Table 4). Table 5 illustrates the analysis ending with a value chain ranking
Table 3. Productivity
Export potentials
48
Using the matrix, six value chains have been indentified and selected for additional assessment.
otato. These products fall into the
participation of actors (including SMEs and MSMEs) or have
emaining value chains
For selecting the final value chains, we have discussed a couple of important factors affecting the
we have looked into the domestic production of those six commodities and
India and China (Table
been given with their compound
with a value chain ranking
Rank Commodity Domestic Production
1 Shrimp (kg) 117.31
2 Jute
3 Tobacco
4 Vegetables
5 Tea
6 Potato
Source: FAOSTAT 2008 920
* FAO fisheries statistics 921
**Aquaculture Authority News 2002, Ministry of Agriculture, Government of India922
923
Table 3 shows that in almost all the commodities 924
and China. However, in the case of potato 925
India, which certainly shows the potential to improve. 926
vegetables [we?] are lagging far behind 927
China but close to India. In jute and shrimp Bangladesh is behind but not too much.928
929
Table 4. Five year exports of top commodities in value (USD thousands) 930
and their Compound Annual Growth Rate (CAGR) over 931
Rank HS Commodity
1 0306 Shrimp
2 5303 Jute
3
2401
Tobacco,
unmanufactured;
tobacco refused
4 0709 Vegetables fresh or
chilled
Domestic Production Productivity (hg/ha)
Bangladesh China
117.31 Million Lbs 565* 700
848715 MT 20184 26666
40265 MT 13741 21381
1100000 MT 70512 170618
53400 MT 10171 9527
6648000 MT 165373 147574
**Aquaculture Authority News 2002, Ministry of Agriculture, Government of India
Table 3 shows that in almost all the commodities [we..Bangladesh is?] are lagging behind
case of potato [we? are more productive than China but less than
which certainly shows the potential to improve. The same is evident in the
are lagging far behind both the countries. In tobacco Bangladesh is far behind
China but close to India. In jute and shrimp Bangladesh is behind but not too much.
Table 4. Five year exports of top commodities in value (USD thousands)
and their Compound Annual Growth Rate (CAGR) over a four- year
Commodity CAGR 2008 2007 2006
8% 447785 612632 482589
10% 162195 196794 141390
unmanufactured;
tobacco refused
23% 30438 20893 14346
Vegetables fresh or -34.6% 15915 50948 37834
49
Productivity (hg/ha)
China India
700 660**
26666 22790
21381 14054
170618 130082
9527 16986
147574 193080
**Aquaculture Authority News 2002, Ministry of Agriculture, Government of India
ing behind India
are more productive than China but less than
the case of tea. In
obacco Bangladesh is far behind
China but close to India. In jute and shrimp Bangladesh is behind but not too much.
Table 4. Five year exports of top commodities in value (USD thousands)
ear period
2006 2005
482589 354883
141390 121911
14346 16320
37834 56925
5 0902 Tea
6 0701 Potatoes
Source: ITC trade competitiveness map932
933
Table 4 shows that Bangladesh has positive growth in shrimp, jute and tobacco but negative in 934
the other best three. 935
936
Before we come to a conclusion, it is 937
political and environmental issue these days as its production is creating environmental hazards 938
and also large shrimp growers driving away 939
hand, from an ethical point of view, tobacco is not an industry to patronize. Hence, we would not 940
consider shrimp and tobacco in the final ranking grid.941
942
Based on the overall analysis, the four value chains943
ranked on a scale of 1 to 10 indicating the strongest correspondence between a value chain and 944
an individual criterion. The results of this ranking exercise are as follows (Table 945
946
Table 5. Value Chain ranking exercise947
Scale 1 – 10 (10 is high) 948
949
Indicators Vegetable
Value addition 5
Participation 8
Export 4
Productivity 6
23
-8.9% 14403 13864 9046
-4.8% 1553 1136 2042
ITC trade competitiveness map
Table 4 shows that Bangladesh has positive growth in shrimp, jute and tobacco but negative in
Before we come to a conclusion, it is important to mention that shrimp has become
political and environmental issue these days as its production is creating environmental hazards
driving away small farmers from their own land
ethical point of view, tobacco is not an industry to patronize. Hence, we would not
consider shrimp and tobacco in the final ranking grid.
analysis, the four value chains, i.e., vegetables, tea, jute and potato were
ranked on a scale of 1 to 10 indicating the strongest correspondence between a value chain and
an individual criterion. The results of this ranking exercise are as follows (Table
Table 5. Value Chain ranking exercise
Tea Jute Potato
6 8 7
6 6 8
5 6 4
5 7 6
22 27 25
50
9046 19087
2042 1803
Table 4 shows that Bangladesh has positive growth in shrimp, jute and tobacco but negative in
to mention that shrimp has become a much more
political and environmental issue these days as its production is creating environmental hazards
land. On the other
ethical point of view, tobacco is not an industry to patronize. Hence, we would not
vegetables, tea, jute and potato were
ranked on a scale of 1 to 10 indicating the strongest correspondence between a value chain and
an individual criterion. The results of this ranking exercise are as follows (Table 5):
Potato
The ranking exercise clearly demonstrates that jute and potato are ahead 950
while all four criteria are considered. 951
study are jute and potato. 952
953
954
Appendix 2: List of respondents955
Sl
no
Type of Actor
1 Input supplier
2
3
4
5
6
7
8
9
10
11
12
The ranking exercise clearly demonstrates that jute and potato are ahead of other competitors
while all four criteria are considered. Hence the finally selected value chains for in
of respondents
6ame Address
Jasim Gazi
Katakhali, Munshiganj
Mosharraf Member
Katakhali, Munshiganj
Kamrul Hasan
Chor Kewa, Munshirganj
Babu
Munshirhat, Munshirganj
Javed Bepari
Chor Kewa, Munshiganj
Shawkat Hossain
Katakhali, Munshirganj
Harun Gazi
Katakhali, Munshiganj
Md. Nasir Uddin
Sourav Enterprise Daudkandi Bazar, Daudkandi, Comilla Mobile: 01712197160
Md. Ikbal Hossain
M/s Rony Traders Daudkandi Bazar, Daudkandi,Comilla Mobile: 01926756935
Md lokman Hossain
Daudkandi Bazar, Daudkandi, Comilla Mobile: 01676416233
Md Abul Kalam
Abdu Miah Store Daudkandi Bazar, Daudkandi, Comilla Mobile: 01676416233
Md Abdus Sattar
Madhaia, Chandina, ComillaMobile: 01718546211
51
other competitors
Hence the finally selected value chains for in-depth
Katakhali, Munshiganj
Katakhali, Munshiganj
Chor Kewa, Munshirganj
Munshirhat, Munshirganj
Katakhali, Munshirganj
Katakhali, Munshiganj
Daudkandi Bazar, Daudkandi,
Mobile: 01712197160
Daudkandi Bazar, Daudkandi,
Mobile: 01926756935
Daudkandi Bazar, Daudkandi,
Mobile: 01676416233
Daudkandi Bazar, Daudkandi,
Mobile: 01676416233
Madhaia, Chandina, Comilla Mobile: 01718546211
13 Farmer
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
Krishna Chandra Hawlader
Chor Hadrabad, Munshiganj Pourashava, Munshiganj Mobile: 01815462627
Md. Khokon Matbar
Chor Kewa, Guetkandi, Munshiganj
Khoka Molla
Munshiganj Pourashava, Munshiganj Mobile: 01811503822
Abdul Hafiz
Tengar chor, Munshiganj
Amin Uddin
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Abdul Khaleq
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Ramiz Miah
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Fazal Shekh
Chor Kewa, Guetkandi, Munshiganj
Najrul Islam
Muktarpur, Munshiganj
Md Ahsan Habib
Muktarpur, Munshiganj
Abdur Rafiq
Muktarpur, Munshiganj
Md Jamal Hossain
Muktarpur, Munshiganj
Kabir Hosen
Muktarpur, Munshiganj
Abu Saleh
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Wali Miah
Joy Debpur, Chandina, Comilla01817598303
Dr. Nurul Islam
Joy Debpur, Chandina, Comilla01917664246
Md Ibrahim
Joy Debpur, Chandina, Comilla
Hasan
Joy Debpur, Chandina, Comilla
Kalu miah
Joy Debpur, Chandina, Comilla
Mohammad Ali
Joy Debpur, Chandina, Comilla
52
Chor Hadrabad, Munshiganj Pourashava, Munshiganj Mobile: 01815462627
Chor Kewa, Guetkandi, Munshiganj
Munshiganj Pourashava, Munshiganj Mobile: 01811503822
Tengar chor, Munshiganj
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Chor Kewa, Guetkandi, Munshiganj
Muktarpur, Munshiganj
Muktarpur, Munshiganj
Muktarpur, Munshiganj
Muktarpur, Munshiganj
Muktarpur, Munshiganj
Chor Hadrabad, Munshiganj Pourashava, Munshiganj
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
Chandina, Comilla
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
33
34
35
36
37
38
39
40
41
42
43
44
45
46 Intermediaries
47
48
49
50
51 Cold storage owner
52
Siraj Miah
Joy Debpur, Chandina, Comilla
Hosen Miah
Joy Debpur, Chandina, Comilla
Abu Taher
Joy Debpur, Chandina, Comilla
Shohid Miah
Joy Debpur, Chandina, Comilla
Khorshed Alam
Joy Debpur, Chandina, Comilla
Abdur Razzak
Nircintopur, Chandina, Comilla
Zoynal
Nircintopur, Chandina, Comilla
Md. Wali Ullah
Nircintopur, Chandina, Comilla
Monir Hosen
Nircintopur, Chandina, Comilla
Tazul Islam
Nircintopur, Chandina, Comilla
Topon Das
Batabaria, Chandina, Comilla
Md Liton
Batabaria, Chandina, Comilla
Bulu Das
Batabaria, Chandina, Comilla
Khoka Mullah
Chor Kewa, MunshiganjMobile: 01811503822
Abdur Rahman
Chor Kewa, Munshiganj
Abdul Jabbar
Chor Kewa, Munshiganj
Abdus Sobhan
Chor Kewa, Munshiganj
Shohel
Muktarpur, Munshiganj
Abdul Latif Sarker
River View Cold StorageGen. Assistant Muktarpur, Munshiganj
Mr. Shib Sankar
Shaha, Manager
53
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
Joy Debpur, Chandina, Comilla
Nircintopur, Chandina, Comilla
Nircintopur, Chandina, Comilla
Nircintopur, Chandina, Comilla
Nircintopur, Chandina, Comilla
Nircintopur, Chandina, Comilla
Batabaria, Chandina, Comilla
Batabaria, Chandina, Comilla
Batabaria, Chandina, Comilla
Chor Kewa, Munshiganj Mobile: 01811503822
Chor Kewa, Munshiganj
Chor Kewa, Munshiganj
Chor Kewa, Munshiganj
Muktarpur, Munshiganj
River View Cold Storage
Muktarpur, Munshiganj
53
54
55 Dhaka market wholesaler
56
57
58 Processor
59
60 Association
61 Exporter
62
Shobhan Ice & Coldstore Ltd., Tongibari, Munshigonj
Md Mafiz Uddin
Executive Director Chandina Farmland and Cold Storage Ltd Chandina, Comilla
Mostafa Azad Chowdhury
Director, Kishan Himagar Limited, Motahar Group, Choto Monthona, Rangpur, Mobile: 01712 099561
Abdul Haq
Haq Banijyalay
Shyam Bazaar, Lalkuthi, Dhaka
Abu Hanif
Mohanagor Arat
Shyam Bazaar, Lalkuthi, Dhaka
Nazir hossain
Munshinganj Arat
Shyam Bazaar, Lalkuthi, Dhaka
Masudul Kabir
Secretary Bombay Sweets & Co. LtdRed Crescent Concord Tower (10Floor) 17 Mohakhali C/A, Dhaka 1212Mobile: 01730010228
Sirajul Islam
Potato Flakes (BD) Ltdhouse# 384, Road # 28new DOHS, Mohakhali, Dhaka 1206Tel: 8821751 Mobile: 01720542837
Mozammel Haque Chowdhury
Secretary, Bangladesh Cold Storage Association, BCSA Bhaban, 38 Purana Paltan, Dhaka 1000. Mobile: 01712 025996
Anwarul Haque
Managing Director Blue Moon International, 4/7 Iqbal Road Mohammadpur DhakaMobile: 01552448748
Estiaque Ahmed Dhaka -1213 Mobile: 01817291717
Managing Director Ejab Group, asal Centre (9th Floor034, Dakal Ataturk Avenue, Banani,
54
Shobhan Ice & Coldstore Ltd., Tongibari, Munshigonj
Chandina Farmland and Cold
Director, Kishan Himagar Limited, Motahar Group, Choto Monthona, Rangpur, Mobile: 01712 099561
Shyam Bazaar, Lalkuthi, Dhaka
Lalkuthi, Dhaka
Shyam Bazaar, Lalkuthi, Dhaka
Bombay Sweets & Co. Ltd Red Crescent Concord Tower (10th
17 Mohakhali C/A, Dhaka 1212 Mobile: 01730010228
Potato Flakes (BD) Ltd house# 384, Road # 28 new DOHS, Mohakhali, Dhaka 1206 Tel: 8821751 Mobile: 01720542837
Secretary, Bangladesh Cold Storage Association, BCSA Bhaban, 38 Purana Paltan, Dhaka 1000. Mobile:
Blue Moon International, 4/7 Iqbal
Mohammadpur Dhaka-1217 Mobile: 01552448748
Ejab Group, asal Centre (9th Floor0 Ataturk Avenue, Banani,
63
64
65 Others
66
67
68
69
70
71
72
956
957
Mr. Mozammel Hoque Choudhury,
Secretary Bangladesh Cold Storage Association, BCSA Bhaban38, Purana Paltan, Dhaka
Engr. Md. Abdur
Razzaque Miah, Mech. &Refrigeration Engineer, Bangladesh Cold Storage Association,BCSA Bhaban, 38 Purana Paltan, Dhaka 1000
Dr. Meer Musharraf Hossain
Senior Consultant, Action for Enterprise, House 3 A 4, NAM Villa, Road 6, Gulshan 1, Mobile: 01714 4093481
Dr. Anisur Rahman Supply Chain Knowledge Management Expert, Hortex Foundation, Dhaka. Mobile: 01720 010936
Md. Fozlul Haque
Director (Field Services Wing)Dept. of Agricultural Extension, Khamarbari, Farm gate, Dhaka1215, mobile: 01720 634666
Abdul Awal Director, Rural Services, Katalyst, House 20, Road 6, Baridhara, Dhaka. Mobile: 01714 069255
Tamanna Sultana Group Manager, Rural Services, Katalyst, House 20, Road 6, Baridhara, Dhaka. Mobile: 01730 338542
Md. Abu Taher Khan Upazilla Agriculture Officer, Upazilla Krishi Office, Chandina, Comilla, Mobile: 01817 511400
Aman Ashraf Faiz Head of Communication Channels, Grameen Phone, Boshundhara, Baridhara, Dhaka. Mobile: 01711505800
Debashis Roy Head of CSR, Grameen Phone, Boshundhara, Baridhara, Dhaka. Mobile: 01711500261
55
Bangladesh Cold Storage Association, BCSA Bhaban 38, Purana Paltan, Dhaka
Razzaque Miah, Mech. & Refrigeration Engineer, Bangladesh Cold Storage Association,BCSA Bhaban, 38 Purana Paltan, Dhaka
Senior Consultant, Action for Enterprise, House 3 A 4, NAM Villa, Road 6, Gulshan 1, Mobile:
Supply Chain Knowledge Management Expert, Hortex Foundation, Dhaka. Mobile: 01720
Director (Field Services Wing) Dept. of Agricultural Extension, Khamarbari, Farm gate, Dhaka-1215, mobile: 01720 634666
Director, Rural Services, Katalyst, House 20, Road 6, Baridhara, Dhaka. Mobile: 01714 069255
Group Manager, Rural Services, Katalyst, House 20, Road 6, Baridhara, Dhaka. Mobile: 01730
Agriculture Officer, Upazilla Krishi Office, Chandina, Comilla, Mobile: 01817 511400
Head of Communication Channels, Grameen Phone, Boshundhara, Baridhara, Dhaka. Mobile:
Head of CSR, Grameen Phone, Boshundhara, Baridhara, Dhaka. Mobile: 01711500261