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Arinloyé A.A.D; Hagelaar, G.; Linnemann, A.R.; Coulibaly, O. and Royer, A.

Constraints and Challenges in Governance and Channel Choice in Tropical Agri -Food Chains: the Case of Pineapple Supply Chains in Benin. Arinloyé A.A.D; Hagelaar, G.; Linnemann, A.R.; Coulibaly, O. and Royer, A. WECARD Cotonou, 24 - 27 May 2010. Outline. Problem statement and objectives

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Arinloyé A.A.D; Hagelaar, G.; Linnemann, A.R.; Coulibaly, O. and Royer, A.

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  1. Constraints and Challenges in Governance and Channel Choice in Tropical Agri-Food Chains:the Case of Pineapple Supply Chains in Benin Arinloyé A.A.D; Hagelaar, G.; Linnemann, A.R.; Coulibaly, O. and Royer, A. WECARD Cotonou, 24 - 27 May 2010

  2. Outline • Problem statement and objectives • Background on pineapple chains • Theoretical framework • Methodology • Results and conclusion

  3. Problem statement • Important issues in the pineapple supply chain: • High transaction costs: cheating, opportunism behavior, corruption, weak logistic facilities, etc. • Limited collective action: lack of organized governance structure • Irregular and scattered supply by smallholders • Thin assembly markets • Poor and variable product quality • Understanding chains’ coordination and organization is needed for a co-innovative quality performance of Beninese pineapple supply chains

  4. Research objective • Analyze the organization and structure of pineapple supply chains in Benin with a focus on chain governance and channel choice for quality improvement

  5. Key Questions • Answering the following questions leads to reach the research objective : • Which actors are directly and indirectly involved in pineapple activities? • What kind of linkages and flows exist in the cooperative networks and how do they affect pineapple quality and chain performance? • What are the pineapple quality issues that are hampering actors’ access to more profitable markets? • Which conflicts or synergies occur between chain actors and who are involved in managing and resolving these conflicts ?

  6. Background • In 2007 government selected pineapple (among others) as a spearhead to counterbalance dependence on cotton • Pineapple production zones With 90% from Atlantique department Guineo Congolian Zone

  7. Background • In one decade, pineapple production increased threefold from 44,836 tonnes in 1998 to 136,123 tonnes in 2008 figure 1: Pineapple production and yield Source: INSAE, 2005 and FAOSTAT, 2010

  8. Theoretical framework Firm characteristics Market choice Performance Quality management • Institutional environment Chain Governance

  9. Research methodology • Case study approach most indicated in responding to: • which ? • what ? • How to understand ? • Information gathering • literature review, questionnaires • interviews and focus group discussions • Sampling • Input suppliers (2) • Producers (20) • Traders (12) • Processors (5) • Exporter (2) • Research institutes , extension and quality control services (12)

  10. Design tests and employed tactics Table1. Design tests and tactics employed during the case study

  11. Firm Characteristics • Pineapple chains are characterized by large and heterogeneous group of producers; • Differences in farm size, scale of production, technical and financial capacities, access to input, land and labour • Current debate for international market: MRL <= 0.5ppm (mg/kg) instead of 2ppm

  12. Institutional Environment • Mismatch between producers requirements and observed interventions • Low public sectors intervention and supports along the chains • High transaction cost (police/gendarme harassment & rural roads conditions) • Subsidized fertilizers sold on the black market • Inappropriate existing credits/loan (2M fcfa for 1ha)  Loans from IMF (36 and 47% APR)  Loans from informal sectors (as high as 20% a day) •  Personal savings and relationship based financial supports  Pre-financing in cash or in kind from pineapple trader or exporters

  13. Channel choice • Choice of a specific chain is affected by: • Price attribute (fixed vs varying) • Temporary specificity • Socio-cultural condition • Product attributes (size) • competition with other fruits • 5 main chains targeted But no quantitative data available

  14. Pineapple chains map

  15. Chain governance mechanisms • Governance structures mainly consist of: • spot market relations • relational contracts • collective action • combination of contracts and collective action • Outgrowing schemes • Relying on exporter to get advice and inputs support • Benefit for both involved parties • Formalizing the trading with Nigeria

  16. Quality Management and control • ILO; HACCP; EurepGAP; ISO, etc. • Stringent norms and quality standards  Reduction of export possibilities (2%) • Consumer’s quality requirements on local and border markets are generally low • Quality affected by : • Less qualified labour and qualified competences with adapted equipments • Farming systems • Access to inputs (planting & fertilizers) • Need of tractability system (accreditation and certification)

  17. Constraints and Challenges in Governance and Channel Choice in Tropical Agri-Food Chains:the Case of Pineapple Supply Chains in Benin Arinloyé A.A.D; Hagelaar, G.; Linnemann, A.R.; Coulibaly, O. and Royer, A. WECARD Cotonou, 24 - 27 May 2010

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