Potato Value Chain Analysis

Inclusive Potato Value Chain: Cooperatives Vs Sola Grow PLC Models in Ethiopia

Kassa T. Alemu (PhD)

Ethiopian Civil Service University

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Abstract

This article assesses inclusive potato value chain in Ethiopia. A prospect for potato production and marketing in Ethiopia is promising due to the agro-ecological suitability of the land and irrigation potential. However, at present the value chain is not well developed. The case analysis compared potato value chain initiated by the private sector company and the cooperative society in Ethiopia and the findings show that cooperative society’s approach is traditional and underdeveloped while the SolaGrow’s approach is more promising and innovative.

In addition, potato is regarded a high-potential food security crop because of its ability to provide a high yield of high-quality product per unit of input with a shorter crop cycle than major cereal crops like maize (Hirpa et al., 2010). Currently, many improved varieties of potato are disseminated by research centers, cooperatives and private suppliers to smallholders and this has contributed to the improvement and expansion of potato production in Ethiopia. However, little has been done to improve the performance of the entire potato value chain in the country and there is no clear evidence on which model works better for the overall performance of potato value chain in Ethiopia. This case study, therefore, investigates subsidized cooperative potato value chain model in Sinan and unsubsidized private investor [SolaGrow PLC] promoted potato value chain model in Debre Ziet so as to come up with valid conclusion on what model works better for inclusive value chain in the

The value chain is innovative and clearly shows the contribution of SolaGrow PLC as a source of input, and market chain for the product. It is also evident that the value added to Solagrwo contract farmers is better than the Sinan case. SolaGrow established strong relationships with the stakeholders of the potato chain up and down to the chain. It has good cooperation with research institutions and universities. The PLC works closely with individual farmers, farmers groups and cooperatives. It provides inputs to farmers and buys their produce. Originally SolaGrow took the production and marketing of potato seed as core business. Since 2010 the company focused on two sides: 1) to take the whole potato chain into consideration, from seed to consumption potatoes to market, and 2) to include the seeds and markets of the rotational crops such as linseed, vegetables, and malting barley. The company realized that farmers tend to move to mono cropping when they once get good profit from a specific crop and wants to prevent this negative trend by creating awareness on this topic of rotation and by offering other alternative crops to the farmers. The major advantage of this approach is the continuous collaboration with the farmers and the spreading of risks by growing complementary