Agribusiness Roadmap and Action Agenda

AGRI-BUSINESS

ROADMAP & ACTION AGENDA

Oscar Aleson Torralba

Management Association of the Philippines

Presented at the 2nd LGU ConferenceOrganized by the National Competitiveness Council

27 February 2009

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ROADMAP & ACTION AGENDA

� Roadmap

�A practical guide for LGUs in developing

agribusiness potential at the LGU level.

� Action Agenda

�A list of actions to be undertaken by the

national and local government agencies

(executive and legislative) to support the

competitiveness of the agribusiness sector as

a whole (To be prioritized during this break-out session)

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ROADMAP

� A practical guide for LGUs in developing agribusiness potential at the LGU level.

�a checklist of attributes of competitiveness

�a list of guide questions and indicators to

assess potential in agri-business as a whole,

and

�an overall framework for developing the local

agribusiness industry to steer local initiatives

towards enhancing their competitiveness.

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AGRIBUSINESS

� Sum total of all operations involved in the

�Farm supplies manufacture & distribution;

�Farm production activities; and

�storage, processing, and distribution of farm

commodities and items derived from them.

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Agribusiness Chain of Activities

� supply of farm inputs;

� production of farm products;

� post-harvest handling, storage, processing and

transport of farm products;

� supply of packaging materials;

� marketing and distribution of fresh processed

and packaged goods; and

� financing of various activities.

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ROADMAP STEP-BY-STEP APPROACH

STEP 1: Ascertain Public-

Private Sector Commitment

STEP 2: Participatory

Resource Assessment

• Form the working group

• Identify and provide financial and other resources

• Define the assessment area

• Conduct biophysical and socio-economic survey• Collect secondary data• Collect primary data• Write report

• Prepare resource map

• Define area zones

• Identify convening agents

• Hold municipal competitiveness conference

STEP 3: Supply Chain

Analysis

• Value chain mapping

• Quantify and describe value chains in detail

• Economic analysis of value chain

STEP 4: Formulate

Strategic Objectives

Based on Competitiveness Analysis Attributes

• Cost • Quality

• Supply reliability • Appropriate Innovation

• Customer service

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STEP 1: Ascertain Commitment to

Competitiveness Initiative

1-1 Identify convening agents and hold a municipal competitiveness conference

�Convening agents = respected and

influential business people and government

officials at provincial and regional levels

�Conference purpose: to assess genuine

interest and commitment among local

stakeholders and agents of change

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STEP 2: Rapid Participatory

Resource Assessment

� Resource Assessment is learning about - -

� local resources and assets, and

� the local people’s perspectives of the potential

and current contribution to development goals

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2-1 Form the working group�Select members of the assessment/survey

team from among the working group members

�The assessment/survey team would be guided and supported by local professional, technical groups and educational and research institutions.


Resource Assessment

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Step 2: Rapid Participatory Resource Assessment

Sample working group members & linkage to enterprise groups.

Working GroupPolicy and

Implementation

Facilitator of the process

NGOsGovernment Agencies

Development agencies

Traders/entrepreneur

Finance

Chamber ofcommerce

Research

Specialists

BDS BDS BDS FA

FG FG FG

FG FG

FAPA

Farmer groups

FG FG FG

FG FG

FG FG FG

FG FG

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� Form the Survey/Assessment Team


Resource Assessment

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2-2 Identify and make available financial and other resources

2-3 Define the assessment area�Decide on the assessment area limits

� Whole municipality

� A barangay

� A cluster of barangays

� Particular communities


Resource Assessment

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2-4 Conduct Biophysical & Socio-economic Survey

(To evaluate assets and social skills available for

agribusiness development)

�Collect secondary data

�Collect primary data

�Write the report


Resource Assessment

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Elements of Resource Survey

� Natural resources�General topography (altitudes: steep, less

sloping, flat areas; arable land; land use)

�Land, especially large areas, that may be made available to investors for plantation scale production of high value, commercial and industrial crops


Resource Assessment

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� Natural resources

�Water sources

�Relative productivity of soils

�Seasons (wet & dry)


Resource Assessment

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� Productive resources�Roads

� Infrastructure

�Major businesses with agricultural links

�Support services

�Transport for produce (frequency, costs and quality)

�Markets


Resource Assessment

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� Communities�Location of communities & their relative

populations

�Land tenure structure

�Location of different ethnic groups/social groups, and their identification

�Level of social organization

�Level of business organization


Resource Assessment

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2-5 Place the Information on a Resource Map


Resource Assessment

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2-6 Define Zones for the AreaZoning is important for prioritizing interventions for competitiveness

� Zoning criteria

� Agroecosystem

� Access to roads and markets

� Land tenure

� Access to water throughout the year

� Productive orientation (for market or for household food security

� Types of existing production systems


Resource Assessment

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STEP 3: Supply/Value Chain Analysis

Value chain: a market collaboration between

different businesses that work together to

produce and market value-added products

Value Chain Analysis Tasks:

1. Value chain mapping

2. Quantify and describe value chains in detail -

attach numbers to the basic chain map

3. Economic analysis of value chains

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a) Value chain mapping

(Chain map is the core of value chain analysis)

� Draw a visual representation of the value

chain system.

� identify business operations (functions), chain operators and their linkages

� Identify the chain supporters within the value chain.


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Consumption

Retailing

Processing

Trading

Trading

Post harvest handling

Production

Research

Transportation

Market information & intelligence

Communications

Financial services

Production input supply

Government policy regulation

Tech. & business training & assistance

Supply Chain Functio

ns/Actors

Support Servi

ces


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b) Quantify and describe value chains in detail -

attach numbers to the basic chain map

�numbers of actors

� the volume of produce

� the market shares of particular segments in the chain (if possible)

� specific chain analyses “zoom in” on any relevant aspect

� Characteristics of particular actors

� Services

� the political, institutional and legal framework conditions enabling

or hindering chain development.


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c) Economic analysis of value chains

�Assess chain performance in terms of

economic efficiency

� value added along the stages of the value chain

� cost of production

� to the extent possible, the income of operators

� transaction costs (e.g., doing business, collecting

information, and enforcing contracts)


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� Economic analysis of value chains

� “Benchmark” the economic performance of a

value chain with competing chains

� Compare the value of important parameters with

those of competing chains

� Analyze different cost structure from input supply, production, processing, marketing of agribusiness

products (based on consultation with the key

industry players in the chain).


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� Strategic objectives are written statements that describe an intended outcome, and clearly describe measurable targets of achievemen

� Example 1:� Supply Chain Segment: Input Supply

� Competitiveness Attribute: Cost

� Strategic Objective: Decrease the cost of feeds by 10% in 2009

STEP 4: Formulation of Strategic

Objectives/Value Chain Upgrading

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Formulation of Strategic Objectives



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� Example 2:

�Supply Chain Segment: Production

�Competitiveness Attribute: Supply Reliability

�Strategic Objective: Increase hog production

by 20% in 2009



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OSCARO – Objective Assessment:

Delivery Objective

S – Strategy Menu

C – Choice of Strategy

A – Act

R – Review

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ACTION AGENDA

� List of actions to be undertaken by the concerned national government agencies (executive and legislative) to support the competitiveness of the agri-business sector as a whole.

� Suggested activities to be undertaken by the LGU in enhancing the development of the sector at the local level.

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Key Issues and Proposed Action

Agenda by Supply Chain Approach

Action agenda National Level Local Level

Key Issues by Supply Chain

Segm ent/ Basic Function

a. Input Supply

b. Production

c . Processing d . M arketing

e . Logistics f. Consumption

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Mr. Michel CamdessusFormer Managing Director,

International Monetary Fund (IMF)

Honorary Governor

Banque de France

Open Forum of the MAP CEO Conference, 7 Oct. 2008

You cannot be competitive in the world if you cannot be

competitive in your country.

Agribusiness Roadmap and Action Agenda

Business

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