The impact of hand shelling in Malawi:

25th January 2016A multi-stakeholder approach to mitigate aflatoxin

contamination of food and feed.By

Andrew EmmottTwin & Twin Trading, Senior Associate (Nuts),

London, UK.

The impact of hand shelling in Malawi:Acknowledgements

This work has been supported by many individuals and organisations including:

•Context:

• Why groundnuts?

• Groundnut production and exports;

• iHand shelling and aflatoxin;

•Barriers and solutions to trading groundnuts in shell;

•Recommendations:

• Buying, drying, storing & shelling centres to service

groundnut farmers;

• Market pull to underpin post harvest centres.

The impact of hand shelling in Malawi:Overview of Presentation

1.Context

i. Why groundnuts?

ii. Malawi groundnut production decline and recovery

iii. Hand shelling and aflatoxin

2.Barriers and solutions to trading groundnuts in shell

3.Recommendations:

i. Buying, drying, storing & shelling centres to service groundnut farmers

ii. Market pull to underpin post harvest centres

The impact of hand shelling in Malawi:Why groundnuts?

The impact of hand shelling in Malawi:

Why groundnuts?

•4 billion hours spent hand shelling groundnuts each year in Africa;

•Groundnuts are the primary source of protein for ca. 0.5 billion people;

•Domestic consumption & regional trade are growing;

•International nut trade renewing interest in Africa; • Aflatoxins are a major constraint to re-enter regulated markets;

•Regional markets in Africa are starting to tighten aflatoxin controls; • Malawi one of 5 PACA pilot countries• Malawi a net exporter of groundnuts

•Significant commitment and coordinated investment needed to establish and secure value chain reputations for quality groundnuts.

The collapse of African groundnut exports to international markets.

5

40% in the 1970’s

90% in the 1960’s

<5% by 2005

•US, China, & Argentina dominate exports;

•Co-ordinated supply chains developed for regulated exports;

•Africa exports collapsed;

•But production & regional trade is now increasing;

•Africa overtaken India as 2nd largest producer.

6

Changes in EU market requirements for groundnuts

•Significant investment needed to re-enter regulated markets eg: EU, South Africa & with PACA support East Africa

Malawi groundnut production & trade

19611967

19731979

19851991

19972003

20090

50000

100000

150000

200000

250000

Malawi groundnut production & export

Export (tonnes)

Pro-duction (tonnes)

• 1970’s > 40,000 mt pa exported to Europe;

•1980’s exports & production collapsed;

•2000’s production revived;

•Hand shelling for confectionary markets;

•Priority crop for 2012 National Export Strategy;

•75% consumed by domestic market;

•Very little is wasted (NB. Current food shortage).

Source: FAOSTAT

8

Malawi groundnut exports (July 2013-April 2014)

Source: IFPRI (Authors’ calculations based on Famine Early Warning System (2014) for informal exports and Malawi Revenue Authority (2014) for formal exports.)

9

Malawi exports to high & low enforcement countries (2004 -2013)

•Most exports now go to low enforcement markets;•Almost no exports now to high enforcement markets;•Some uncertainty about the current volumes of informal

exports;•Note the drought years (circles) NB. 2015 poor rains (2.8

million people in need for food aid - FEWS).

2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

20406080

100

Proportion of total exports to low enforcement countries (%)Linear (Proportion of total exports to low enforcement countries (%))Proportion of total exports to high enforcement countries (%)Linear (Proportion of total exports to high enforcement countries (%))Proportion of total exports sent informally (%)Linear (Proportion of total exports sent informally (%))

Years

%

?

?

4 billion hours of hand shelling per year across Africa

On farm hand shelling

•Poor storage & drying;•Shells are soaked to ease hand shelling;•Limited sorting of contaminated nuts.

•Groundnut flour had most contaminated samples;

• 73% > EU 4ppb level.

• 25% above 100ppb • highest = 3871 ppb•70% of families add

groundnut flour to meals ca. twice/ week.

Test

s on

260m

t of

gro

undn

uts <2%

sorted out

60% used in food or feed

Sources: ICRISAT (2011) & Twin GPAF (2013)

On farm hand sorting:Not enough contaminated crop is removed

from the food chain!

Contaminated nuts are eaten by informal consumers

Formal vs informal value chains

Controls in formal value chains:•Protect consumers in export, local

retail & other markets;•Eg: Locally produced safe RUTFs for

severely malnourished children.

Informal value chains:•Improving quality will impact all

consumers;•There is little awareness or food safety

& control of aflatoxin;•Few incentives to reduce aflatoxin

levels; •Crushing contaminated crop for oil &

meal relevant to formal & informal chains.

Shelling

Storage

Sorting

Improve infrastructure, awareness & standards

Partnerships needed:• Malawi Partnership for

Aflatoxin Control (MAPAC) established;

• Aligned to PACA;

• Formal value chain partnerships eg: Afri-Oils encouraged;

• Investment needed to address farmer drying, storage, irrigation etc.

Appropriate drying

NIS grading &

sorting

Dry shelling

Kernel grading &

sortingAflatoxin Risk Prevalence

No No No No Very High Very High

No No No Yes High Very High

No No Yes No High Low

Yes No No No High Low

No No Yes Yes High High

Yes No Yes No Moderate Low

No Yes Yes Yes Low Very low

Yes Yes Yes No Low Very low

Yes Yes Yes Yes Very Low Very low

Aflatoxin risk matrix -current trading vs proposed in-shell trading practices

CurrentCurrent

Current

Proposed

In-shell trading, backed by a certified warehouse and buyer or seller contracts needed to improve confidence in quality groundnuts from Malawi.

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Aflatoxin exposure and infection

• Three “states” with respect to Aflatoxin in groundnuts: (OK; Exposed; Infected.)

• Nuts flow into each inventory stage with some distribution of OK, Exposed, Infected

• While in each stage, nuts “leak”…– From OK to Exposed through

exposure flow– From exposed to infection

through infection flow• Nuts that move to next stage

of supply chain reflect cumulative impact of exposure and infection

Exposure here… …Can show up

as infection here!

Source: S Paterson (2015)

1 9 17 25 33 41 49 57 65 73 81 89 97 1051130

50100150200250300350400

Afri-Nut Aflatoxin Results (2013)

Chalimbana CG7

Samples

aflat

oxin

ppb

Proportion of all Afri-Nut samples in 2013: • 26% > 4ppb; &• 16% > 15ppb.

ICRISAT (2009) Groundnuts sampled with > 4ppb aflatoxin:

•43% at farmers households;

•49% from local markets;

•58 – 60% from shops and supermarkets;

•41% from warehouses; •73% of flour samples.

Examples of aflatoxin sampling results for raw peanuts in Malawi (2009 & 2013).

Recommendations:

Establish financial services to facilitate buying/ post harvest centres: •Pilot of buying and post harvest processing centres supported by economic analysis;

•Review appropriate financial services / market pull e.g. Warehouse receipts;

•Explore wider services e.g drying and crushing in ACE certified warehouse storage of nuts in shell.

• Majority of market led work re: aflatoxin and groundnuts focuses on building export value chains;

• Export driven groundnut market system and value chains fail to serve the needs of smallholder producers and consumers;

• Need for a food safety focus in local food systems and farm level infrastructure as well as export value chains.

Conclusion:Importance of food safety in all food systems

There is a need for a cross sector approach to the issue

of aflatoxin

Thank you