Joint Kenya and Uganda cassava value chain diligence for a shared-value high maltose syrup industrial investment

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Situation

Technological advances in agro-processing and a shift toward high maltose syrup in the brewing and food industry paved the way for investors to consider building a starch/high maltose syrup processing facility in western Kenya, and including a brewery for making quality beer, as a safe alternative to illicit liquor, that was being consumed widely in the region. The partners—which included a global non-profit partner that promotes inclusive business models—desired to develop a shared value program, wherein trained cassava farmers, primarily smallholders, would supply the brewing industry and gain significant income increases.

A key objective of the engagement was to confirm the long-term availability of quality cassava in western Kenya and eastern Uganda. Additionally, the investors sought an investigation of the potential to build the efficient transport logistics necessary for maintaining the quality of fresh cassava tubers from farm to processor.

The client further required an analysis of likely changes in food security dynamics in the target production areas, seeking to ensure minimum disruption in food supply or pricing for contracted producers and local markets.

Engagement

This work entailed conducting extensive field studies in western Kenya and eastern Uganda. We identified the existing sources of cassava supply, local value chain dynamics, agricultural technology adoption, political economy factors, food security dynamics, and transportation logistics—especially cross-boundary processes, and how to mitigate potential delays—for produce sourced from Uganda. In addition, we assessed the potential to tap into the large East African market opportunity to further increase smallholder farmer incomes from quality cassava production for domestic consumption.

ORI supported the investors by:

  • Conducting a detailed cassava value chain analysis for Kenya and Uganda.
  • Developing model cassava farmer typologies and their geographic distribution in western Kenya and eastern Uganda and assessing their potential to become efficient suppliers.
  • Sizing existing and potential cassava supply and the feasibility of agricultural technology adoption (related to improved cassava cuttings and better agronomic practices) for improving yield and quality.
  • Evaluating the cost and logistics of cultivating and distributing clean planting materials of sufficient quantities across expansive geographies.
  • Assessing the feasibility of developing new cassava production and the economics of transportation and logistics of fresh cassava roots to the proposed starch/high maltose syrup processing facility in Kisumu.
  • Developing a systematic approach and guide to organizing smallholder cassava growers and modeling improved smallholder incomes based on production and market assumptions.
  • Determining the number of smallholders—including women—to participate in a proposed inclusive business initiative, across various market and food security scenarios.
  • Modeling fresh cassava tuber bulking and collection routes to achieve the most efficient logistics and meet the quality requirements for high maltose starch processing.
  • Building cassava planting schedules consistent with processing investment requirements while factoring in food security demands.
  • Analyzing the likely change in food security dynamics and impacts resulting from increased cassava purchases by the new investment and making recommendations to mitigate potential negative impacts.
  • Evaluating capabilities and strategic fit of potential implementation partners to the non-profit and designing an inclusive business model program for smallholder cassava industry development anchored on harnessing value creation drivers and capacity building of farmer organizations for long-term sustainability.
Outcomes
  • Modeled fresh cassava tuber production—over a five-year horizon—based on several scenarios, each built on rigorous assumptions including agricultural technology adoption, number of smallholder farmers, acreage under production per farm family, productivity, food security requirements, and climate change, among others.
  • For each scenario, cassava production necessary to meet food security needs and the quantities available to supply the industrial investment was modeled.
  • Mapped recommended locations of bulking centers based on locations of areas of high production and the transportation/logistics required to ensure the delivery of high-quality fresh cassava roots to the factory.
  • Designed an inclusive business model program for building a competitive cassava industry -- we identified potential implementation partners, and framed major interventions to deliver development impact (improved incomes, food security, adoption of better farming technologies) and to supply the industrial investment.

 

Based on this work, the non-profit won a $3 million grant to implement a technical assistance initiative, including the development of farmer organizations—an essential factor in delivering long-term socioeconomic impact. We subsequently negotiated with national agricultural research organizations a dedicated program for producing clean cassava planting materials and farmer training in the counties of Busia, Homa Bay, Siaya, Migori, and Kisumu; and the eastern Uganda districts of Soroti, Tororo, Busia, Palissa, Budaka, and Lira.