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09 Oct2005

Overstory #162 - Agroforestry Tree Products (AFTPs): Markets

Written by Roger R.B. Leakey, Zac Tchoundjeu, Kate Schreckenberg, Sheona E. Shackleton, and Charlie M. Shackleton.

Introduction

The term Agroforestry Tree Products (AFTPs) is of very recent origin (Simons and Leakey, 2004) and refers to timber and non-timber forest products that are sourced from trees cultivated outside of forests. This distinction from the term non-timber forest products (NTFPs) for non-timber extractive resources from natural systems is to distinguish between extractive resources from forests and cultivated trees in farming systems, and hopefully will avoid some of the confusion in the current literature (Belcher, 2003). Nevertheless, some products will be marketed as both NTFPs and AFTPs (depending on their origin) during the period of transition from wild resources to newly domesticated crops. Consequently, both terms are used in the following sections.

Economic and social benefits from trading AFTPs

In west and central Africa, a number of indigenous fruits and nuts, mostly gathered from farm trees, contribute to regional trade (Ndoye et al., 1997). In Cameroon, the annual trade of the products of five key species has been valued at US$7.5 million, of which exports generate US$2.5 million (Awono et al., 2002). Perhaps because of this trade, evidence is accumulating that AFTPs do contribute significantly to household income (Gockowski et al., 1997; Awono et al., 2002) and to household welfare (Schreckenberg et al., 2002; Degrande et al., in press). For example, farm level production of three indigenous fruit and nut species in southern Cameroon has been reported to be worth US$355 (Ayuk et al., a/b/c), from an average farm size of 1.7ha, and against an average annual expenditure of US$244 (Gockowski et al., 1998). In Cameroon, farmers from four widely dispersed villages indicated that indigenous fruits represent 12.5% of their primary income, and 17% of their secondary income, while the equivalent income from exotic fruits was 6.8 and 3.5% respectively (Degrande et al., in press). In Nigeria, the equivalent proportions of income from indigenous fruits were 15% as primary income and 37.5% as secondary income, while exotic fruits had no value as primary income and only 2.5% as secondary income (Degrande et al., in press). A crop of D. edulis fruits can be worth between US$20-150 per tree, depending on the quality of the fruits and the yield (Leakey et al., unpublished). Thus, taking the number of Dacryodes edulis trees per household (Schreckenberg et al., 2002), and a low estimate of the value of their fruits per tree (US$20) gives another estimate of annual income per household of US$380 - 2000. This result concurs with an economic analysis of farms in Cameroon with an average size of 1.4ha, which found that when indigenous fruits are grown with cocoa they have a Net Present Value/ha (over a 30-year period with a 10% discount rate) of about US$500 (Gockowski et al., 1997; Gockowski and Dury, 1999). It seems that similar situations occur outside West Africa. For example, in South Africa, although the absolute income from Sclerocarya birrea fruits, kernels and beer was not as great as that from D. edulis in Cameroon, it was nevertheless in excess of the local wage rate (Shackleton et al., 2003b). In Guyana, subsistence households were able to generate value added equivalent to US$288 per capita per annum, from utilisation of Andiroba oil and other forest resources (Sullivan, 2003).

What would be the impact of domestication on household income? It is anticipated that improved quality and market appeal from the domestication of these fruits would result in farmers getting higher prices, so long as supply does not exceed demand. At present there is high demand, but it is known that although the retail traders recognise the higher value of superior fruits, the wholesale traders do not (Leakey et al., 2002). This is probably because a loaded truck of fruits from the current crop comes from a wide variety of trees of seedling origin and therefore includes the full spectrum of quality from very poor to superior. This would not be the case once farmers are planting recognised cultivars, as it would be possible for the wholesaler to obtain a loaded truck of superior fruits.

Different indigenous fruit species can vary in their seasonality, thus income opportunities can be spread across the year. Thus the overall household benefits from several different AFTPs, even without domestication, are almost certainly greater than the above examples suggest. To these benefits can also be added those that are derived from AFTP products used in domestic consumption, which represent a saving on expenditure. Evaluation of the economic benefits are further complicated by the fact that cash earned from AFTPs can potentially be invested in fertilizers, or in adding value to products, etc., so increasing the overall income derived from the sale of AFTPs.

Women are often the beneficiaries of this trade and they have especially indicated their interest in marketing D. edulis fruits because the fruiting season coincides with the time to pay school fees and to buy school uniforms (Schreckenberg et al., 2002). It is also the women who are the main retailers of NTFPs (Awono et al., 2002), with men being the wholesalers, and interestingly, it is the retail trade that recognises the market value of the tree-to-tree variation in size, colour, flavour, etc. (Leakey et al., 2002). Evidence has also been shown that some communities domesticate valuable species for the purposes of intergenerational security (Sullivan, 2003). Clearly these are social impacts of importance both to sustainable development in general, and in particular to the empowerment of women (Millennium Development Goal 3). Further work is, however, required to get a much better understanding of the market dynamics and potential for expansion. In the case of D. edulis, extending the season with early and late fruiting cultivars would be important (e.g. the Nöel cultivar, which fruits at Christmas); as would methods to extend their shelf life through simple fruit storage (bottling, canning, drying, freezing, etc.) and processing into paste, biscuits (Mbofung et al., 2002), etc. Similar trends are emerging in southern Africa, where indigenous fruits have relatively new local and international markets (Brigham et al., 1996; Shackleton et al., 2000; 2002; 2003b).

The production and trading of AFTPs are based on traditional lifestyles, with many products used both for domestic consumption and/or sale depending on the household's cash and nutritional requirements. The ability to use household labour for harvesting/processing, combined with the low requirement for skills, capital and external inputs, makes it relatively easy for poor producers to adopt this approach to intensifying production and enhancing household livelihoods.

With HIV/AIDS now reaching up to 20-30% of the population in the worst hit countries (Swallow et al., in press), one social benefit of special interest is potential health benefits which may accrue from a diet including more indigenous fruits and vegetables, many of which are rich in protein, oils, minerals and vitamins (Leakey, 1999a; Leakey et al 2005). The domestication of species producing these nutritious AFTPs is seen as a way to further enhance nutritional security and health, by strengthening the immune system of HIV/AIDS sufferers. This is seen as a critical component of an integrated natural resource management approach to improving the lives of poor people worldwide, especially in southern Africa (Barany et al., 2003). Worldwide, medicinal products represent an annual international trade valued in excess of US$1 billion (Rao et al., 2004). Many of these are herbs, which can be grown in the shade of agroforestry trees.

The linkages between the domestication and commercialisation of AFTPs

The success of domesticating agroforestry trees is very dependent on there being an adequate market for the products (AFTPs). In some instances, species currently being domesticated, such as D. edulis, I. gabonensis and Gnetum africanum, have local and regional markets, including exports to neighbouring countries (Awono et al., 2002). In other cases, such as Prunus africana and Pausinystalia johimbe there are already established international markets in Europe and USA, in addition to local ones (Cunningham et al., 2002). As already indicated, market-oriented domestication has the greatest likelihood of being adopted on a scale to have impact on the economic, social and environmental problems afflicting many tropical countries. This requires that agroforesters work closely with the companies processing and marketing the products (Leakey, 1999a). However, in doing this it is important to remember that smallholder farmers are the client of the research and development work and that there needs to be a functional production-to-consumption chain. This principle was apparently overlooked during recent domestication of peach palm in Amazonia (Clement et al., 2004), resulting in the underperformance of the market. This failure has been attributed to a lack of understanding about the consumers' needs, and incorrect identification of the research client (i.e. the smallholder and not the entrepreneur).

In many cases the successful commercialisation of AFTPs is dependent on domestication, as frequently initiatives to develop markets for new products collapse (or do not expand to their potential) when supply does not meet the demand. This is especially problematic if the product has a seasonal production pattern, and the product is derived from many small growers, with minimal quality control. Another constraint to commercialisation can be the intraspecific variability that is so beneficial to the domestication process. This variability is a major problem when uniformity of quality (taste, size and purity) is important in the marketplace. Quality control is doubly important if there is any local level processing for value-adding, to extend shelf-life or to reduce the costs of bulk transport. Domestication is one way to increase the supply of high quality product, and through cultivar development can also greatly improve the uniformity of the product. Domestication can also lead to an extended season of production, making it easier to supply industries throughout the year. Good examples of coordinated domestication and commercialisation are kiwi fruit (Actinidia chinensis) and macadamia nuts (Macadamia integrifolia). Kiwi fruits were first grown commercially in New Zealand in the 1930's. By the 1950's there were a number of commercially grown cultivars and fruits were first exported in 1952. The Macadamia selection programme started in 1934, with considerable market interest.

In many domesticated crops, the market demand for the product has promoted large-scale mono-cultural production systems that frequently have been the cause of environmental degradation through deforestation, soil erosion, nutrient mining, and loss of biodiversity. Typically, these systems of farming have also resulted in social inequity and the 'poverty trap' for small-scale producers who are unable to compete in international trade with large or multi-national companies. Concerns about this have rightly raised many questions about the wisdom of domesticating and commercialising agroforestry trees. The key question that agroforesters have to address is whether or not agroforestry can prevent these negative impacts. In theory, agroforestry is beneficial to the environment and beneficial to the poor farmer. At the level of the individual farm there are many examples of these benefits being achieved. For example, extensive intercropping with trees and shrubs provides subsistence households in Amerindian communities with a significant degree of food security (Sullivan, 2003). The problem and the complexity of this issue is exacerbated by the need for agroforestry to be scaled up to the point when it reduces poverty and has environmental benefits at national, regional and global scales. So, what will happen if the domestication of AFTPs is so successful that the market-demand for one of them reaches the point when a company sees the opportunity to develop monocultural plantations as a cash crop either in the country of origin or in some overseas location with a similar climate and better access to markets? Will this undermine the whole purpose of developing new crops? The answer has to be a qualified - 'yes'. Having said that, what reservations or limitations can mitigate the problem? These issues were the subject of an ICRAF conference in 1996 (Leakey et al., 1996) and it was concluded that, recognising the traditional role of non-timber forest products in food security, health, income generation, the potential benefits from domestication outweighed the risks.

Winners and losers: impacts on livelihoods

The importance of non-timber forest products for the livelihoods of poor forest dwellers has been recognised for some time (Peters et al., 1989; Sunderland and Ndoye, 2004; Vedeld et al., 2004). A multi-disciplinary, multi-institutional study of the impacts of different commercialisation strategies for a number of different NTFP products from Sclerocarya birrea within farming systems and in structurally- and ethnically-different communities has provided very interesting insights as to who are the "Winners and Losers" (Sullivan and O'Regan, 2003). The study was structured to examine the impacts of commercialisation on the five forms of Livelihood Capital (Human, Social, Financial, Natural and Physical). This review cannot do justice to this comprehensive study, but in brief it was concluded that to improve the livelihood benefits from commercialising NTFPs it is important to improve:

(a) the quality and yield of the products through:

  • domestication and the dissemination of germplasm
  • enhancing the efficiency of post-harvest technology (extraction, processing, storage, etc.)

(b) the marketing and commercialisation processes by:

  • diversifying markets for existing and new products
  • investing in marketing initiatives and campaigns
  • promoting supply contracts with equitable distribution of benefits, opportunities in national and international cuisine that build on indigenous knowledge and cultural heritage, improved sensory characteristics (taste, aroma, etc.), market chain investments, trading partnerships in local businesses with plans for sustainability (including exit strategies), commercialisation pathways that recognise the role of women, health and nutritional benefits.

The analysis from this study identified the factors that determine who/what are the Winners and the Losers under different circumstances.

The following lessons were learnt for NTFP commercialisation from the study of Sclerocarya birrea (abridged from Shackleton et al., 2003b), that apply equally to AFTPs:

  • NTFPs are most important for poor and marginalised people, and make up income shortfalls but do not significantly alleviate poverty. How domestication may change this still needs to be determined.
  • Engagement in NTFP commercialisation and the extent of benefits is variable even amongst the poorest households. Households are far from homogenous in their levels of engagement. Entrepreneurship, labour availability, personal drive and choice play a pivotal role in determining whether or not households take up opportunities. So too do the levels of organisation within a community, the availability and quality of information about markets, access to transport, and the extent to which a producer is 'networked'. Benefits of NTFP commercialisation must be weighed against the negative social and cultural costs of commercialisation: There are trade-offs, which need to be recognised, between the preservation of traditions, cultures and social norms, and the benefits derived from increased income.
  • Land and usufruct rights must be clear, government intervention pitched at the appropriate level, and political support for the NTFP industry secured: Insecure land tenure and resource rights can have a range of negative economic, social and ecological outcomes, and can severely jeopardise efforts to successfully commercialise NTFPs. The commercialisation of marula illustrates the central role that can be played by customary law in NTFP management. The findings argue for greater integration of customary and local law in places where traditional systems have eroded, and minimal governmental intervention in areas where customary law is adequate to deal with the pressures of commercialisation.
  • NTFP commercialisation can lead to improved management and conservation of the resource in certain circumstances. This depends on the particular product, the species, the presence of a conducive policy environment, the feasibility/desirability of cultivation, and the potential for participatory domestication by interested communities.
  • An abundance of 'winner' qualities need to be in place or developed amongst the participants in the trade, and across the resource and markets. NTFP cultivation needs to be community-owned and driven: Communities harvesting products and domesticating the species, need assistance and support to guarantee their ownership of germplasm and knowledge, and to ensure they are the beneficiaries of future commercialisation initiatives.
  • Benefits can be accrued at the local level: Value adding increases the returns to labour, but does not have to be large scale or aimed at external markets e.g. marula beer, in which traders can earn greater income per hour than the suppliers of fruit and kernels to other markets.
  • Communities are generally poorly placed to benefit from intellectual property rights: Intellectual property rights (IPRs) can play both a potentially positive and negative role in protecting the interests of primary producers, but to realise positive effects communities need substantial finance and support. There is an urgent need for IPR systems that promote poverty alleviation, food security and sustainable agriculture as NTFPs make the transition to AFTPs.
  • Models of commercialisation based on partnerships between producer communities, NGOs and the private sector are most likely to succeed: Partnerships between different players can allow for mutually profitable arrangements (e.g. CRIAA SA-DC marula oil model). Most important is the retention of ownership and control of the enterprise at producer level.
  • Diversified production and reduced dependence on a single product: The diversification of species used, products produced, markets traded, and players involved, is an extremely important strategy to minimise the risks of NTFP commercialisation for rural communities. Often it is best to build on what exists at the local level rather than aiming for new high value, specialised markets.
  • Scaling up and introducing new technologies can shift benefits away from women and the most marginalised producers: The increased commercialisation of NTFPs inevitably entails a shift from small-scale to large-scale, male-dominated activities.
  • NTFPs form only part of a far broader ecological, economic, social and political landscape: NTFPs are harvested and used within the context of broader development and land-use pressures. For example, continued land clearance, the need for biomass energy, and woodcarving can be a greater threat than the commercialisation of a fruit product.
  • NTFP trade and industries are dynamic in space and time: There are seldom permanent winners and losers in the NTFP trade and producers' relationships with the resource base, other role players, the industry and the markets will be constantly changing and adapting in response to a range of internal and external drivers and processes and policy contexts.

The conclusion from this on-farm study was that NTFP/AFTP commercialisation can create both Winners and Losers, but positive outcomes can be maximised if the importance of community involvement is appreciated by external players and if the communities themselves work together and use their own strengths to manage and use their resources effectively. This provides encouragement and some endorsement that the approach being developed for the participatory domestication of agroforestry trees is appropriate. This is supported by the findings of a study investigating the role of tree domestication in poverty alleviation (Poulton and Poole, 2001). Nevertheless, to ensure the farmers engaged in participatory domestication are Winners, there is the need to resolve the current difficulties facing farmers wishing to protect their rights to the cultivars that they are producing.

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Original source

This article was reprinted with the kind permission of the publisher and authors from:

Leakey, R.R.B., Z. Tchoundjeu, K. Schreckenberg, S.E. Shackleton, and C.M. Shackleton. 2005. Agroforestry Tree Products (AFTPs): Targeting Poverty Reduction and Enhanced Livelihoods. International Journal of Agricultural Sustainability Vol. 3, No. 1.

This article was excerpted from the full length paper that will appear in the International Journal of Agricultural Sustainability Vol. 3, No. 1, 2005. This issue will be available from http://www.channelviewpublications.net/ or by contacting info@channelviewpublications.com. For more information about the International Journal of Agricultural Sustainability please visit http://www.channelviewpublications.com/.

About the authors

Roger Leakey is Professor of Agroecology, and Director of the Agroforestry and Novel Crops Unit, School of Tropical Biology, James Cook University in the wet tropics of Queensland, Australia. Between 1993–97 he was Director of Research at ICRAF (now the World Agroforestry Centre). He has undertaken studies on vegetative propagation, genetic improvement of tropical trees, tree domestication, soil microbiology, agroforestry in dry and moist tropics and moist forest regeneration, with research projects in Kenya, Cameroon, Ghana, Nigeria, South Africa, Namibia, Costa Rica, Indonesia, Malaysia, Papua New Guinea, Vanuatu and Solomon Islands. Since 1982, he has undertaken consultancies for ODA, World Bank, European Development Fund, FAO and ACIAR, in Malaysia, Thailand, Vietnam, Laos, Japan, Philippines, India, Bolivia, Costa Rica, ten countries of West Africa and Australia. He can be reached at: PO Box 6811, Cairns, Queensland 4870, Australia; Email: roger.leakey@jcu.edu.au.

Zac Tchoundjeu is the Regional Coordinator of the World Agroforestry Centre (ICRAF), African Humid tropics, based in Yaoundé Cameroon. He was the Director of ODA Project in Cameroon before joining ICRAF in 1995. His research and development work took him in Sahelian region where he developed vegetative propagation techniques for high-value indigenous fruit trees and medicinal plants for Senegal, Niger, Burkina Faso and Mali. Since 1998, Zac is coordinating ICRAF activities in Cameroon, Nigeria, Democratic Republic of Congo, Gabon, Equatorial Guinea and Ghana where particular emphasis is being given to participatory tree domestication of high-value fruit trees and medicinal plants of the region. He can be reached at P.O. Box 13 617, Yaoundé Cameroon; Email: z.tchoundjeu@cgiar.org.

Kate Schreckenberg is an independent researcher on rural development forestry issues with a special interest in improving the benefits obtained by small-scale forest producers. She is a forester with a PhD in Geography from the School of Oriental and African Studies in London. Her current research includes an investigation of the poverty impacts of participatory forest management, understanding the factors that determine the success of commercialisation of non-timber forest products, and a study of verification systems in the forest sector. Other recent work focused on domestication of indigenous fruit trees in Cameroon, and conservation of on-farm tree resources in Honduras and Mexico. With 19 years experience of forestry research and policy advice in the developing world including work in Benin, Bolivia, Burkina Faso, Cameroon, Honduras, Indonesia, Kenya, Mexico, Namibia and Thailand, she is increasingly interested in facilitating lesson learning from South to North. She is a Research Associate with the Overseas Development Institute in London, where she worked and was editor of the Rural Development Forestry Network from 1996 to 2004. She can be contacted at k.schreckenberg@odi.org.uk.

Sheona Shackleton is a Research Associate with both the Department of Environmental Science at Rhodes University, South Africa and the Center for International Forestry Research, Indonesia. She has recently completed a PhD that explores the linkages between natural resource commercialisation, livelihoods and poverty alleviation in South Africa. Her areas of research specialisation include: natural resource utilisation and valuation in communal tenure systems; theoretical, policy and practical aspects of community-based natural resource management (CBNRM); community forestry and woodland management; rural livelihood systems and commercialisation of wild resources/non-timber forest products. Sheona can be contacted at the Department of Environmental Science, Rhodes University, Grahamstown, 6140, South Africa, email: s.shackleton@ru.ac.za.

Charlie Shackleton is Associate Professor and Head of Environmental Science at Rhodes University South Africa. He has research interests on rural livelihoods, models for sustainable use of non-timber forest products, resource modelling and savanna ecology. He can be reached at Dept of Environmental Science, Rhodes University, PO Box 94, Grahamstown 6140, South Africa; e-mail: c.shackleton@ru.ac.za

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