Organization and Performance of Cotton Sectors in Africa ... - infoDev

More documents

Recommendations

Info

MALI AND CAMEROON: GOVERNMENT MONOPOLIESTHAT SHOW SIMILAR STRENGTHS AND WEAKNESSESMali and Cameroon, along with Burkina Faso, share similar approaches to inputcredit and extension, inspired by the “West African model” of cotton promotion.The model features exhaustive coverage of farmers in agro-ecologicallysuitable areas with a standard in-kind credit package that includes about 50 kgof urea and 100 to 150 kg of compound fertilizer per hectare (ha), about sixinsecticide sprays per season, herbicides for some farmers, treated and reasonablywell-maintained seed, and widespread adoption of animal traction. For manyyears, this input package was accompanied by a network of extension agents incharge of advising on agricultural best practices and technical itineraries forimproved cotton cultivation. Most cotton sectors in WCA also now includean elaborate structure of village cotton farmer organizations configured intoregional and national “apex” organizations. These apex organizations, alongwith ginning companies, form—or are in the process of forming—“interprofessional”bodies with responsibility to make joint decisions about inputsupply and pricing, among other factors. Notably, the government is not partof these interprofessional bodies, except through its ownership stake in thecotton company.Objective indicators of input system performance are comparable acrossMali and Cameroon:■■■Input packages are nearly identical in composition and cost, and coverageof farmers is exhaustive in the main cottor zones of each country.Average yields are about 200 kg (of seed cotton) per ha higher in Cameroon,but this difference may be due to agro-ecological factors more than to inputquality (yields in the extreme north of Cameroon are nearly identical tothose in Mali).Yields are trending down at about the same rate in each country, related atleast in part to higher cost and thus lower use of fertilizers.Two key differences in input and extension systems in the two countries areworth noting. First, Cameroon’s producer organizations are substantiallystronger and play an active role, in collaboration with SODECOTON, in inputprocurement, pricing, and distribution; credit recovery; and provision ofextension services. Associations of larger, higher-yielding farmers inCameroon employ and pay extension staff members. Organisation des Producteursde Coton du Cameroun, the national apex organization, employs 76trainers to strengthen village-level associations. In Mali, the national apexorganization does not yet exist, and it will likely take several years for the systemto gain the financial and operational strength already seen in Cameroon.A second key difference is that management of SODECOTON may bemore attuned to opportunities to improve performance and reduce costs74 TSCHIRLEY
in its operations. One example is that it imports generic bulk insecticides thatfarmers mix in the field. SODECOTON claims that these products arecheaper and that it is able to use them because of the relatively dense networkof field agents, who are able to disseminate pesticide preparation techniquesto farmers.LOCAL MONOPOLIES: VASTLY DIFFERING HISTORIESCOMPLICATE COMPARATIVE ASSESSMENT INMOZAMBIQUE AND BURKINA FASOBurkina Faso moved to a local monopoly system with three firms in 2004, inthe midst of a huge boom in cotton production made possible by many yearsof investment in research, input credit, and extension, as well as by relativelyhigh prices paid to farmers since 2000. 48 In sharp contrast, Mozambique createdits local monopoly system in the late 1980s, as civil war still raged and afternational production had fallen below 10,000 tons of seed cotton. Even beforethe civil war and the economy’s collapse, cotton production in Mozambiqueused far fewer external inputs than did the sector in Burkina Faso. One area inwhich the countries show similar performance is in the share of all farmersgrowing cotton in the cotton zones: 85 percent across Burkina Faso’s wholecotton zone, and as high as 80 percent in Mozambique’s cotton belt.In reforming its cotton sector, Mozambique returned to the concession (orlocal monopoly) model prevalent during the colonial era. Key themes duringthe postreform era have been the absence of any systematic approach to evaluatingand reawarding concession areas, extremely weak farmer organizationsunable to negotiate with ginners or provide services themselves, widely divergentperformance between early investors and new entrants (most of the latteraffiliated with international cotton trading firms), recurrent credit defaultcrises, and the government’s openness to new investment, albeit always withinthe concession model. Until recently, the country clearly lagged behind itsneighbors in productivity, though new entrants since the early 2000s havebegun to change this in some areas of the country.Key lessons from Mozambique’s experience are, first, that a local monopolysystem does not eliminate the possibility of credit default crises. If investmentopportunities and regulatory capacity in a country are limited, the cotton sectoris likely to attract new entrants, leading to side selling and increased credit default.Eventual decline in seasonal input credit and extension services is usually theresult; in fact, both services are weakest, with extension almost nonexistent, in theareas most affected by credit default. Second, policy makers in local monopolysystems must select investors carefully. All companies in Mozambique face thesame, very weak, government regulatory capacity. Yet some companies have chosento invest in improved input supply and some extension, while others haveoperated for many years much like the new entrants in Zimbabwe, thus providingminimal quantities of poor quality input and little or no extension advice.INPUT CREDIT AND EXTENSION 75
Page 1:
AGRICULTURE AND RURAL DEVELOPMENTOr
Page 4 and 5:
AGRICULTURE AND RURAL DEVELOPMENTSe
Page 6 and 7:
© 2009 The International Bank for
Page 8 and 9:
Section II. Historical Background a
Page 11 and 12:
BOXES, FIGURES, AND TABLESBoxes2.1
Page 13:
5.2 Summary of Pricing Mechanisms i
Page 16 and 17:
eference are limited to neighboring
Page 19 and 20:
ACKNOWLEDGMENTSThis study was carri
Page 21 and 22:
ABBREVIATIONS¢ U.S. centACPAgricul
Page 23:
US$U shWAEMUWCAWTOU.S. dollarUganda
Page 26 and 27:
output markets, improving productiv
Page 28 and 29:
etween these competing needs, provi
Page 30 and 31:
■■■■■competition increase
Page 32 and 33:
monopolies range from 0.98 to 1.15,
Page 34 and 35:
macroeconomics, developments in com
Page 36 and 37:
central body and that the state nee
Page 39 and 40:
CHAPTER ONEIntroductionDavid Tschir
Page 41 and 42:
The debate about how to deal with t
Page 43 and 44:
Figure 1.1 Map of Africa Highlighti
Page 45:
hypotheses about sector performance
Page 48 and 49:
to reach 25 million tons of lint in
Page 50 and 51:
cotton production was introduced in
Page 52 and 53:
Figure 2.2 Nominal Cotton Prices (U
Page 54 and 55:
Box 2.1 (Continued)Togo, 39 percent
Page 56 and 57:
Box 2.2 Cotton SubsidiesCotton subs
Page 58 and 59:
efers specifically to the presence
Page 60 and 61: picking, storage, handling, or tran
Page 62 and 63: national monopoly (state-owned or p
Page 65: SECTION TWOHistorical Background an
Page 68 and 69: shares belonging to governments, an
Page 70 and 71: Changes Made Since the End of the 1
Page 72 and 73: long-term development strategies, (
Page 74 and 75: possible link between price-setting
Page 76 and 77: production fell further, to lows of
Page 78 and 79: all aspects of the chain from input
Page 80 and 81: suggestions (a) of establishing fas
Page 82 and 83: Figure 4.1 Decision Tree for Cotton
Page 84 and 85: Figure 4.2 African Cotton Sector Ty
Page 86 and 87: Box 4.1 Is This Typology Specific t
Page 88 and 89: 52Table 4.1 Trading Off: Strengths
Page 90 and 91: CONCEPTUALIZATION OF THE LINKS BETW
Page 92 and 93: chosen in this book and the impact
Page 94 and 95: Table 4.3 Expected Performance alon
Page 96 and 97: Box 4.2 (Continued)Second, farmers
Page 99: SECTION THREEComparative Analysis:C
Page 102 and 103: PRICING MECHANISMS IN WCAPricing me
Page 104 and 105: efore planting, price risk in the s
Page 106 and 107: Table 5.3 Summary of Producer Share
Page 108 and 109: Finally, FOT price shares in WCA ro
Page 112 and 113: Significant in Mozambique, the comp
Page 114 and 115: Zimbabwe transitioned during the 19
Page 116 and 117: Box 6.1 (Continued)A move from a co
Page 118 and 119: 82Table 6.1 Summary of Input Supply
Page 120 and 121: 84Table 6.1 (Continued)IndicatorsCo
Page 123 and 124: CHAPTER SEVENQuality ControlGérald
Page 125 and 126: Tanzania Competitive 1 2 Very lax n
Page 127 and 128: Figure 7.1 Estimated Premium for To
Page 129 and 130: all fiber coming from Africa—are
Page 131 and 132: Box 7.1 (Continued)newly liberalize
Page 133 and 134: CHAPTER EIGHTValorization of SeedCo
Page 135 and 136: competitive market in some of the o
Page 137 and 138: a few years, it indicates that some
Page 139 and 140: should eventually make a difference
Page 141 and 142: CHAPTER NINECotton ResearchDuncan B
Page 143 and 144: With regard to human and financial
Page 145 and 146: ■■■Be involved in setting res
Page 147 and 148: made royalty payments to CRI. When
Page 149: and to identify complementary inves
Page 153 and 154: CHAPTER TENYields and Returns toFar
Page 155 and 156: fact that 55 percent of cotton is p
Page 157 and 158: Yields by Farmer TypeTo assess perf
Page 159 and 160: Factors beyond company services als
Page 161 and 162:
Table 10.1 Summary Crop Budgets by
Page 163 and 164:
According to the focus group inform
Page 165 and 166:
Figure 10.6 Net Margins after All C
Page 167 and 168:
All other variables in the budgets
Page 169 and 170:
Table 10.2Summary of Average Yield
Page 171 and 172:
■■■■impression is given tha
Page 173:
were based on a 2005 cotton farmer
Page 176 and 177:
more recent data are not available
Page 178 and 179:
Figure 11.1 Estimated Average Ginni
Page 180 and 181:
to buy seed cotton immediately afte
Page 182 and 183:
146Table 11.3 Overall Competitivene
Page 184 and 185:
148Table 11.4 Total Value Added per
Page 186 and 187:
Figure 11.3 Total Value Added per c
Page 189 and 190:
CHAPTER TWELVEConclusionsPatrick La
Page 191 and 192:
Table 12.1 Summary of Expected and
Page 193 and 194:
Valorization ofby-productsValue of
Page 195 and 196:
Macro impact■ Total value addedpe
Page 197 and 198:
across concession zones, with newer
Page 199 and 200:
high yields. However, a mixed pictu
Page 201 and 202:
governance and regulatory structure
Page 203 and 204:
against price and exchange rate ris
Page 205 and 206:
Improvements in the Delivery of Ext
Page 207 and 208:
esistant, “stacked” genes), and
Page 209 and 210:
Just as improved sector management
Page 211 and 212:
More-competitive systems are perhap
Page 213 and 214:
■■■■Interprofessional commi
Page 215 and 216:
were to occur, it would most likely
Page 217 and 218:
APPENDIX AStatistical Tables181
Page 219 and 220:
1989/90 43 111 383 40.7 95 0.491990
Page 221 and 222:
1989/90 62 150 416 41.0 95 0.671990
Page 223 and 224:
1989/90 43 89 482 41.3 95 0.651990/
Page 225 and 226:
1989/90 99 189 521 42.8 85 0.541990
Page 227 and 228:
1997/98 31 327 95 33 to 35 2,950 83
Page 229 and 230:
1994/95 82 344 238 33 207.0 40.0119
Page 231 and 232:
Table A8 ZambiaSeasonLint productio
Page 233 and 234:
Table A9 ZimbabweSeasonLint product
Page 235 and 236:
Table A10 Ginning and FOB-to-CIF Co
Page 237 and 238:
1997/98 1.64 598 210 75 49 74 7.619
Page 239:
1987/88 17,609 31,238 564 414 911 4
Page 242 and 243:
206 NOTES11. Important cotton secto
Page 244 and 245:
208 NOTES47. Benin is not included
Page 246 and 247:
210 NOTES79. In Zimbabwe and Zambia
Page 249 and 250:
BIBLIOGRAPHYBadiane, Ousmane, Dhane
Page 251 and 252:
and Instability, ed. A. Sarris and
Page 253:
World Bank. 2007. Strategies for Co
Page 256 and 257:
CFA exchange rate, 17-18b, 19fcompa
Page 258 and 259:
input credit and extension in, 77-8
Page 260 and 261:
firm types, 211n93fixed prices, for
Page 262 and 263:
productivity, 119, 121f, 205n8,209n
Page 264 and 265:
key indicators, 56-58, 57-58t,155-5
Page 266 and 267:
focus group discussions by farmerty
Page 268 and 269:
technology transfer, 170-71by typol
Page 270:
ECO-AUDITEnvironmental Benefits Sta
show all

Organization and Performance of Cotton Sectors in Africa ... - infoDev

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?