Progress report and orientations for next 6 months
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Progress Report and orientations for next 6 months. Project of Thanh Hoa luong value chain development (LDP) ( October 2007 – April 200 8 ) Phase II. Document for meeting No.7 of LDP’s steering committee April 18th 2008.

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Progress report and orientations for next 6 months

Progress Report and orientations for next 6 months

Project of Thanh Hoa luong value chain development (LDP)

(October 2007 – April 2008)

Phase II

Document for meeting No.7 of LDP’s steering committee

April 18th 2008

Patrice Lamballe – GRET representative

Chu Văn Sáu – LDP project coordinator


Component i

Component I

SUPPORTING LUONG VALUE CHAIN DEVELOPMENT


Main content

Main content

  • Study and make list of luong processing workshops in Thanh Hoa province

  • Training for luong processing workshops: owners, managers, accountant

  • Support Song Ma co-operative (X5).

  • Produce charcoal from luong by-products

  • Grow mushroom on luong sawdust.


1 study and make list of enterprises in thanh hoa province

1. Study and make list of enterprises in Thanh Hoa province

  • Objectives: update information on luong processing units in Thanh Hoa, make list and provide for production units, management agencies and donors.

    b. Operations and results:

  • Together with office of processing (Dept. of Agriculture and Rural development) make first list of 54 bamboo luong processing units in Thanh Hoa

  • Consultant co-operative Ha Hoa - Phu Tho (HaDeVa) conducted the next survey in 5 days with 6 people

  • Gather preliminary survey information and make summary table of 51 units.

  • Project staff monitor regularly and update new information for timely addition when changes occur


C some noticeable points

c. Some noticeable points

Synthesis of 51 units shows:

  • 25/51 units are operating as enterprises, the remaining are households of individual production and business (diagram 1).

  • 20 units (39%) produce refined products (end products), 31 units (61%) produce rough products.

  • Most of the units (26/51) were established since 2006

  • Processing units gather mostly in Quan Hoa district (21/51)

  • 4 main demands of units are: product diversification, market expansion, capital, and production of end products (diagram 2)


Survey results of luong processing units

Survey results of luong processing units


2 training for workshops owners

2. Training for workshops owners

  • Necessity to implement training:

  • Processing units are mainly spontaneous, short of experiences of management and market.

  • Their need of knowledge on management and business is huge.

  • Currently there is no training activity in the locality.

  • Units need to meet and exchange to seek for further cooperation opportunities (for instance: X5)

=>For the development of enterprises, owners need to be provided with business management skills and cooperate with each other.


Progress report and orientations for next 6 months

b. Activities and results achieved

  • Identified needs of processing units and local enterprises

  • Designed training programs and organized first session in December 27-28, 2008.

  • Conducted 3/ Σ6 sessions in the course, in 5 days with 52 cumulated participants

  • 3 topics dealt with:

  • Enterprise cycle and decision-making skill

  • Financial management and accounting works

  • Marketing at enterprise level.


C problems encountered and proposals

c. Problems encountered and proposals

  • Problems encountered

  • Workshop owners directly arrange their production so it is difficult to manage time

  • Knowledge and experience of business management are different

  • Workshops locate in large area and often far from the training organization place

  • Proposals

  • Content should be close to reality

  • Participation of local concerned agencies.

  • Combination of connecting and supporting activities: bamboo luong cooperation group, network (small scale)


3 supporting song ma co operative x5

3. Supporting Song Ma co-operative (X5)

a. Information of Song Ma co-operative

  • Date of formal starting operation: 01/11/2007

  • Floating capital: 500 mil – Fixed capital: 1.100 mil dong: including land, workshop, equipment, power station, machines, truck

  • Members: 7 people (X1; X2; X4).

  • Loan from OHK (through GRET) : 1.060 million dong

  • Direct workers: 25 people

  • Stable job for workers in 10 satellite workshops

  • Types of slat products:

    roughly planed slats, planed+ boiled slats.


B production and market

b. Production and market

  • Raw slats bought : 1.5 million slats (3 months).

  • Use all raw slats of X workshops and other 7 workshops (new cooperation).

  • 2 output markets are TBF and Tien Dong, ensuring the consumption of all products of the co-operative

  • Income of 1.4 billion dong and profit of over 50 millions after 3 months.

  • Worker wage is from 1.1 to 1.7 million dong/month (payment by results)


Progress report and orientations for next 6 months

Summary table of production and business results of co-operative (after 3 months of operation: Nov, Dec 2007 and Jan 2008)


C current difficulties

c. Currentdifficulties

  • Poor management skill of workshop owners.

  • Unequal quality of input (raw slat).

  • Limited finance (for expanding production scale and investing in new technologies for new products).

  • Immediate payment of input, late payment for output (now 2 buying units owing about 350 million dong)

  • Unstable and limited market (long time in stock makes slats attacked by fungus).


D reasons of continuation of production

d. Reasons of continuation of production

  • Stable income for co-operative, jobs and income for workshop laborers

  • Ensuring stability of 3 satellite workshops and 7 new cooperating workshops.

  • Stabilizing input market and maintaining prestige with customers.

  • Many potentials in future (key production location, many investors wanting to join).

  • Possible to diversify products, improve technology for next stages of flooring boards


4 producing charcoal from luong by products

4.Producing charcoal from luong by-products

a. Necessity to build charcoal kilns

- Treat low value wastes and by-products for higher value

  • Use small luong culms not qualified to make slats and chopsticks.

  • Gradually replace wood charcoal made from wood trees in future

    - Minimize environmental pollution (using waste to make paper pulp)

    - Build and develop new sub-sector: bamboo luong charcoal value chain


B charcoal kilns built and now operating

b. Charcoal kilns built and now operating


C current difficulties1

c. Current difficulties

  • Monthly production quantity is not enough to export (at least 6 tons/month), to meet big export contracts needs

  • Quality norms are not high enough to meet demand of some customers of high grade activated carbon

  • Cost price is still high due to incomplete techniques, separate production

  • Processing units are not ready to invest as formal market is not visible at the moment

  • Customers of luong attar have not yet been found


D economic return of charcoal production in 1 cycle using slat wastes minislats of x6

d.Economic return of charcoal production(in 1 cycle using slat wastes, minislats of X6)


E potential of charcoal production

e. Potential of charcoal production

  • Some customer ordered 6-8 tons/month, at price of 6000d/kg in Thanh Hoa city

  • Yield will reach 1 container 20” (6 tons)/month after system of 4 kilns has been built and working.

  • Cooperation with NEAD company in technologies of activated carbon in Thanh Hoa

  • University of Natural Sciences HCM City (Ms My Hanh)

  • Research of feasibility of producing charcoal briquette/sawdust

  • To break the vicious circle and thus prospect of developing charcoal production – trading enterprises in Thanh Hoa


5 growing mushroom on luong sawdust

5.Growing mushroom on luong sawdust

  • Reasons for trial activities

  • Huge amount of luong sawdust is currently unused

  • Results of growing mushroom on luong sawdust is not inferior to wood sawdust.

  • Local market is potential to expand.

  • Creating new job to increase income on the spot for farmers/new model in rural economy nông ôn.


B some activities and results up to now

b. Some activities and results up to now

  • 16 trainings, 167 cumulated participants.

  • Households growing mushroom: stage 1-10hhs, stage 2-7hhs

  • Types of mushroom grown:

    - Stage1: 3 types (linh chi, shell, wood’s ear)

    - Stage 2: 2 types (linh chi, wood’s ear), as shell mushroom is not suitable with hot and sunny weather.

  • No. of bags: stage 1: 5.170 bags, stage 2: 6.000 bags.

  • No. of bags up to standard:

    - Stage 1: wood’s ear 77%, linh chi 36%, 88% shell.

    - Stage 2: wood’s ear 92%, linh chi 94%


D economic return of growing mushroom averaged on 100 bags 1m floor

d. Economic return of growing mushroom(averaged on 100 bags = 1m² floor)


E conclusion on mushroom trial

e. Conclusion on mushroom trial

  • Shell, wood’s ear and linh chi mushroom can be grown on luong sawdust and bring about economic effect

  • Wood’ear mushroom is suitable for existing technical and market condition of farmers and can be grown all year round.

  • Production at farm/co-operative scale is suitable to use sawdust (40-50 tons/year) and brings about investment effectiveness.

  • Mushroom “seeds” of second and third grade can be produced on the spot to reduce production cost.

  • Key model of cooperation mode among producers (co-operative/farm and farmer household)


Orientations of component 1 market processing 1 expanding intervention scale

Orientations of component 1 (market, processing)(1)Expanding intervention scale

  • Base on the list (of over 30 processing workshops in North West of province (aiming to support workshops in L.Chanh, Q.Son)

  • Thorough grasp of operation, support need and economic effect of workshops (1 trainee / University of Agriculture)

  • Organise meeting of workshop owners

  • Resume courses on enterprise management

  • Get to know vocational education more


Orientations of component 1 market processing 2 expanding production scale and volume

Orientations of component 1 (market, processing)(2)Expanding production scale and volume

  • Conduct visits for potential investors (including Chinese)

  • Test production of charcoal / sawdust

    • 140 tons sawdust – 20 tons products/month

    • Sales $10.000 – profit of $1.500-2.000

  • Consider possibility to produce activated carbon in the province ?

  • Improve technology of existing workshops (flooring boards, …) ?

  • Agree on way to use capital repaid by X5 (VND 250 millions/year)

  • Study on suitable credit system


Orientations of component 1 market processing 3 resuming intervention at medium and small scale

Orientations of component 1 (market, processing)(3)Resuming intervention at medium and small scale

  • Improve capacity of producing charcoal from slat waste and small culms on the spot(as temporary intermediary of output)

  • Test slat splitting, making mat strips, sticks

  • Test of more effective production diversification of blind strips

  • Expand production of mushroom / sawdust

    • Production scale may reach the use of at least 100-150 tons of sawdust/year

    • 1 co-operative in charge of input and output

    • Use the mushroom substratum as organic fertilizer


Component ii

Component II

Farmers and resources

(agro-forestry activity)


Outstanding activities results in last 6 months

Outstanding activities - results in last 6 months

1. Expand field of activity to new areas

2. Test different intervention modes

3. Capacity building-training

4. Improve and promote effect of nursery

5. New luong plantation and establishment of « models » in spring 2008

6.Test and support intercropping on new luong plantation area

7. System of experimentation.


1 expand field of activity to new areas

1.Expand field of activity to new areas


2 test intervention modes

2. Test intervention modes


3 education training

3. Education, training

a. Education to improve skill for collaborators and farmer group leaders

  • 1 class on plan-making skill for farmer groups.

  • 1 class on lesson plan making for 5 collaborators, 1 extension staff and 5 teams of group leaders.

  • 2 group leaders and 3 collaborators made lesson plan and gave lecture

  • 1 ToT for 18 commune extension staff of Ngoc Lac district.


B training sessions for farmers

b. Training sessions for farmers


4 improve and promote effect of nursery

4. Improve and promote effect of nursery

  • Analyze strengthes, weaknesses, opportunities and challenges of nursery activities in 2006 – 2007.

  • Diversify types of nurseries and plants.

  • Develop network of 1 main nursery (Lâm -Toán), 11 satellite nurseries

  • Provided 24 000 luong seedlings qualified to plant in the forest.

  • 1 nursery to test multiplication methods, species diversification (Xuan Phu)


5 new luong plantation and establishment of model in spring 2008

5. New luong plantation and establishment of model in spring 2008


Comments lessons learnt

Comments – lessons learnt

  • Gathered model: difficult to negotiate with farmers, but more effective.

  • Mode of cooperation with extension staff: rapid and effective implementation

  • Mode of cooperation through nursery: effective, less time to monitor the field for staff.

  • In Ngọc Lặc, Thường xuân: difficult to do due to competition of other crops

  • Quan Hóa, Bá Thước are new implementation fields, not yet really adapted, leading to slow progress rate.


6 trial support intercropping on luong plantation

6. Trial, support intercropping on luong plantation

a. Objectives of trial in second year

  • Trial of some intercrops likely to give productivity on luong plantation in first 2 years (4 crops)

  • Helps prevent erosion and soil improvement

  • Enough references to recommend to farmer.

  • Establish fund of intercrops at group and village scale.

    b. Intercrops.

  • 3 main crops: peanut, soybean, sesame, species to compare are maize, cassava, sugarcane; plant tephrosia on contours

  • Plant 3 more trials to compare forestry wooden trees


C no of households and intercrop area in spring 2008

c. No. of households and intercrop area in spring 2008


7 system of trials 7 1 trial on new luong plantation

7. System of trials7.1. Trial on new luong plantation


7 2 trial of forest rehabilitation

7.2.Trial of forest rehabilitation

  • In 8 places with total area of 6ha.

  • In Coi village, Xuan Phu - Quan Hoa with over 2 ha area.

  • 5 trial formulas (treatments).

  • Marking to monitor quality of 1.5 ha luong forest


Orientations for component 2 agriculture sustainable management of forest 1

Orientations for component 2 (agriculture)Sustainable management of forest (1)

  • 1. Occasional work, in short time:

    • Experiments of rehabilitation and restoration of luong forest

    • Dissemination documents of sustainable luong management

    • New plantation of luong in the North West (model in Q. Hoa, Ba Thuoc)

    • Monitor, synthesize and analyze short term crops (peanut, bean,…)

    • Ensure seeds availability for autumn crop through rotating fund of seeds


Orientations of component 2 agriculture sustainable management of forest 2

Orientations of component 2 (agriculture)Sustainable management of forest (2)

  • 2. Research and synthesis:

    • Compile synthesis document of knowledge on luong

    • Synthesize document from short term crop results in spring 2008

    • 1 trainee research on capacity of absorbing carbon of luong culms / short term crops

    • Plant more in autumn crop where there is combination of budget (combined with 661, CT 147, 100)


Component 3 supporting agricultural policies commitments of meeting no 6 recall

Component 3: Supporting agricultural policiesCommitments of meeting no. 6 (recall)

  • 2 provincial seminars to promote new policies.

  • 2 seminars at district level

  • 3 leaflets introducing the project and development prospects of value chain

  • 2 common activities with State projects.

  • 2 visits conducted (to China)


Progress report and orientations for next 6 months

Component 3: Supporting agricultural policiesCreate favourable environment and good conditions for policies supporting businesses and luong growers (1)

  • 1 provincial seminar on policy

    • December 14th 2007, 70 participants

    • Participation: representatives of provincial agencies and 10 districts of Thanh Hoa

    • Supporting presentations of forestry department, forest management, processing office, contributions of Ngoc Lac and Quan Hoa district

    • 1 proceeding book to be edited.

    • 1 article on LDP commitment orientations

    • Departement of agriculture and rural development is building policies based on the essence of that contributions


Component 3 supporting agricultural policies 2

Component 3: Supporting agricultural policies(2)

  • Joining the visit to China, in November 2007

    • 7 people from Thanh Hoa

    • 2 districts : Lin An and Ạn ji / Zhe jiang

    • Took: pictures, videos, products, …

    • Main ideas :

      • Timely investment of stakeholders (the government, …)

      • Long-term investment of the Government

      • Synchronous investment, combining mechanic workshop

      • Used over 90% of Moso bamboo

      • Sustainable management of forest


Component 3 supporting agricultural policies 3

Component 3: Supporting agricultural policies (3)

  • 1 seminar organized at district level

    • Ngoc Lac district (February 2008)

    • District’s vice-chairman participates

    • 40 representatives (district, comm.)

    • Introduction of project, activities and clearer explanation of support mode

    • Discussion and agreement on support regulations and mode


Component 3 supporting agricultural policies 4

Component 3: Supporting agricultural policies (4)

  • 1 preliminary seminar in Xuan Phu commune, Q. Hoa

    • To understand better objectives and role of project

    • Preliminary wrap-up 3 months of operation

    • Knowing more about commune’ s condition, orientations expectations

    • Preparing intervention plan

    • Measures taken:reduce competition between farming and husbandry


Component 3 supporting agricultural policies 5

Component 3: Supporting agricultural policies (5)

Common activities with Government

  • Research, with Nead company, to produce charcoal and activated carbon

  • Complete common technical leaflets (5) with forestry association, extension centre

  • Associate with policies of district, province (upland fields) : not in time/this spring crop

  • Diversify, test intervention method

  • Training for extension staff in Ngoc Lac


Orientations for component 3 creating favorable context for luong value chain

Orientations for component 3Creating favorable context for luong value chain

  • Disseminate policies on bamboo (elaborating + distributing leaflets)

  • 1 meeting to review progress after 2 seminars in 2007

  • Continue to organize seminar at district level where important and needed

  • Cooperate with district, province to build model in the area

  • Introduce and get to know about Chinese « Neiyou » system (traceability and sustainable management)


Component 4 synthesizing experience dissemination 1 capacity building

Component 4 : Synthesizing–experience dissemination (1) Capacity building

  • Implement 3 training sessions for processing workshop owners

    • 1 session on basics of market and enterprise

    • 1 session on enterprise management and accountancy

    • 1 session on basic marketing

  • Strengthen skills in the locality

    • One TOT for extension staff of communes in Ngoc Lac district


Component 4 synthesizing experience dissemination 2

Component 4 : Synthesizing – experience dissemination (2)

  • Elaborate 3 technical leaflets on luong through seminars and exchange

    • Propagation techniques and nursery

    • Techniques of new plantation and tending

    • Sustainable management and exploitation

  • 1 plan for luong leaflets distribution

  • Elaborate 2 more leaflets on groundnut and soybean (with exchange and complementation of relating agencies)


Orientations for component 4 synthesis dissemination and capacity building

Orientations for component 4Synthesis, dissemination and capacity building

  • Continue to introduce project, explain activities to intervention districts

  • Leaflets introducing project and activities (market and agriculture)

  • Technical leaflets (mushrooms (3), charcoal)

  • Intensify exchange among relating projects and specialists

  • Receive province, district delegations

  • Organize visits for stakeholders

  • Complete monitoring and evaluation


Summary of orientations for next 6 months

Summary of orientations for next 6 months

  • 1. Improve management capacity, get to know about vocational education

  • 2. Seek for and organize visits for potential investors

  • 3. Produce charcoal (from sawdust, slat waste) at large scale

  • 4. Increase capacity of production diversification of workshops

  • 5. Technical guidance, sustainable management of forest

  • 6. Contribute ideas to form policies and cooperate for effective expansion

  • 7. Broad presentation of activities of project, dissemination of results


Recommendations for luong value chain 1 policies for charcoal processing and production chain

Recommendations for luong value chain1.Policies for charcoal processing and production chain

  • How to support value chain structuring, establishment and association of enterprises ?

  • Suitable banking system for current needs and demand of small and medium enterprises

  • Reduce producing and selling wood charcoal to facilitate the development of luong charcoal

  • Common activity with Dept. of Sciences and Technology to produce high quality charcoal ?

  • What current policy to develop craft villages?

  • 1 autonomous centre supporting agricultural and value chain development?


Recommendations for luong value chain 2 policies to manage rehabilitate and reafforest

Recommendations for luong value chain 2. Policies to manage, rehabilitate and reafforest

  • No. 02 land use policy is relevant; pay attention to crops, species to be grown (Cassia ?)

  • Which activity / plantation on mountain fields ?

  • One concerted policy to create conditions for best management of forests:

    • Agree on method of forest management and rehabilitation

    • Implement trial at communes, village level ?

    • How to limit selling 1-1.5 year old culms ?

    • Facilitate testing system of origin identification (traceability system like Neiyou)

  • Provide information to associate activities


Progress report and orientations for next 6 months

Thank you !


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