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1st Value Added: Clean Bag Of Grain

clip_image002_0005Assisting smallholders add value to their marketed crops is an integral part of value chain promotions. Perhaps the first opportunity to add value that can be done at the home or community level is providing a clean bag dry of grain that can command full value from the private traders or other purchasing entity to advance up the value chain to the ultimate consumer.

This could be a substantial but underappreciated concern. Frequently bags of grain such as rice, maize, beans, groundnuts and sunflower will contain 10% or more trash, including chaff, mud clods, stones, weed seeds, and other forms of field debris that can easily be seen with a grain thief (spike). This trash must be removed down to the 1% tolerance level allowed by processors. Traders and processors in order to have viable businesses have no choice but to discount the value of the marketed bags received from farmers in anticipation of the amount of trash they contain as well as the cost of removing the trash. This then affects the farmers’ bottom line. In Kano, Nigeria a processor of sorghum, cowpeas and cassava indicated he would deduct 15% for a bag of grain purchased in the open market. That is a substantial deduction. Thus if farmers were able to sell clean bags of commodities they should be able to command up to 15% premium price, once the trades and processors are confident the bags are of high quality.

Frequently, this trash is manually removed prior to or immediately after the bag is sold as shown by the young women in the photo cleaning groundnuts in the commodity market of Nairobi. This is time consuming and expensive, costing about US$2.00 per 50 kg bag of shelled groundnuts, and consumes most of a day to clean one bag. It is a very menial task that can only earns basic survival wage barely enough to cover the 2000 Calories For Daily Metabolism. Fortunately, the task does not require extensive calorie exertion or the wages would be unsustainable, and the young women will be exerting more caloric energy then the wages will provide. Medium and large processors frequently have to spread the grain on large perforated trays to screen out the small material like sand and small weed seeds, but still have to manually remove the larger and lighter foreign material too large to pass through the perforations. Some of this can be blown free with fans. Again this is a time and labor consuming process with associated costs the discount for which could represent an avoidable loss to the smallholder producers.

Ironically, there is the question, how much of the trash is a deliberate or semi-deliberate effort to increase the farmers’ returns by attempting to pass off trash for grain. Some of this could be associated with the repayment of Informal Production Loans with a specified in-kind repayment. The in-kind repayment can be an effective mechanism to encourage early repayments, since the repayment will be a bag of grain one month or five months after harvest. Making early payments shifts the liability for post harvest losses from the borrower to the lender. The effective of trash in the repayment bag is to reduce the 100% quoted seasonal interest rate, but perhaps also forgoing any in-kind discount for promptly delivered clean bags of grain the lender might be willing to offer, and which is in the lenders best interest as a means of encouraging clean bags promptly delivered shortly after harvest. Part of the 100% seasonal interest rate with in-kind repayment has to be anticipating the amount of trash in the bag, as well as the time to clean it and other collection costs, including monetizing the grain back to cash. If the inclusion of trash is a deliberate effort to inflate the amount of grain, it most likely is not working as the dealers are anticipating and discounting, accordingly.

If this is not a deliberate effort, then it has to be linked to post harvest handling of the grain. If this is mostly manual then there is considerable opportunity for trash to get in particularly during whacking threshing as is common for rice and beans. Also there is ample opportunity for mud and stones to contaminate the grain if it is laid out on the ground for sun drying, prior to being winnowed and bagged, even if done on a paved surface. The common practice of winnowing via the wind does not seem to fully remove the trash. Sometime it simple move the debris from one farmer’s drying winnowing area to the neighbor’s area as the debris slowly makes its way down wind to finally leave the drying – winnowing area. For rice the amount of trash, particular stones and mud clods often results in the paddy being run through a de-stoner prior to milling. A process that typically will kick out about 10% of the good rice along with the stones and mud clogs sticking to the grains. Again the buyers have to anticipate and discount appropriately, from what the farmers receive.

The solution maybe to look more closely at the traditional post harvest handling of grain and see what might be possible to enhance the process to allow cleaner bags of grain to be marketed. This many include looking at some simple winnowing machines. These are often manually operated because  controlling the speed of a motorized winnowing machine accurately enough to remove trash, yet not blow off valuable grain, can be difficult. The whole operation could actually be handled through some community based family agro dealer enterprises that are purchasing commodities from the smallholder producers, bulking to a sufficient amount to cell to larger traders as the commodities move up the Six Stage Value Chain that frequently separates the growers from the consumers. They could easily justify the machinery and use it when purchasing grain from the farmers, or cleaning retained seed. This could be particularly useful if the Financial Management Strategy emphasizes retaining goods in kind and marketing only small qualities as immediate cash is required. This would bring continuous small quantities grain for sale over a prolonged period of time after the initial harvest that could easily be put through a winnower and cleaned before being finally bagged by the purchasing agro-dealers, and consume only minimal time while the shop attendant is multi-tasking in attending the shop. The mechanical winnowing operation, when moved to a major multi-person drying – winnowing areas may need to be placed downwind to the prevailing winds to avoid the winnowing of one person’s grain contaminating the next person downwind. This will assure the winnowing tailing will be quickly removed from the area.

This all has to be approached with due consideration for the economic cost associated with cleaning relative to other economic opportunities the farmers may have. This could also change as the post harvest season advances. Shortly after harvest the farmers could be fairly heavily jammed between cleaning the grain, and gathering additional grain. Or, the drying floor could also be in heavy demand across the community, and thus urgency could be getting the grain dried and bagged as quickly as possible, with no time to pay much attention to trash and cleaning. Bags that need to be quickly marketed shortly after harvest to meet delayed financial obligation such as loan repayment, or school fees, may not be cleaned as well as those marketed later when there is not so much pressure on the farmer or his family. However, after the initial flurry of post harvest activity, it might be possible for the farmers or their spouses to re-spread the grain and pay more attention to the quality that is being marketed. This would again be consistent with the desire to retain the grain in-kind as long as possible.

One concern is that once farmers are providing clean bags of grain up the value chain they may need to make certain the bags are clearly marked, as they move up value chain dealers will be anticipating trash and discounting accordingly, thus it may take some time to anticipate the clean bags and provide the extra compensation accordingly. Ultimately, it should provide the farmers with added value for their commodities.

Last Revised: 16 March 2010

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