Cover_Rebuilding West Africas Food Potential

Chapter 11. Oil palm industry growth in Africa: a value chain and smallholders’ study for Ghana 359

4. Oil palm production structure, value chains and business models

4.1 Oil palm and derivative products value chain, from plantation to final

consumption/utilization

The oil palm supply chain consists of the following series of activities: producing raw material, linking

with processing, obtaining the final product, marketing and selling to the end user. The availability and

quality of support services, in the forms of transport, storage and/or finance can have an effect on costs

and returns at every stage and ultimately defines the profit margins as production moves along the chain.

The main actors in the system are the producers (nurseries, smallholders, medium and large private

farmers, estate plantation owners), processors, traders/wholesalers, retailers and consumers (household,

commercial and industrial users). The supply chain is illustrated in Figure 5. The oil palm production system

in the chain is carried out in two main production systems: (a) large estate plantations; and (b) smallholder

private farms intercropped with food crops during establishment of the oil palm crop.

To a large extent, availability and affordability of inputs determine the productivity of the smallholder oil

palm farms. Inputs for the oil palm supply value chain include sprouted seeds and seedlings, fertilizer, herbi-

cides and insecticides (chemicals) and are provided mainly through the open market for the smallholder,

private farmer. Inputs in the form of oil palm seeds are provided by government agencies, through the Oil

Palm Research Institute (OPRI). Technical support and extension services are provided by the Ministry of

Food and Agriculture (MoFA). Financing is a major link in the supply chain; this is mainly provided to the

smallholder farmer through non-governmental organizations (NGOs) and micro-financing groups.

Figure 5. The Oil Palm Supply Chain

Source: MofA (2010)

NURSERIES

PRODUCERS

PROCESSORS

(CPO &PRO)

End UserSoap, Edible oil, etc

Consumers

Lux, Frytol, Jomil etc

MEST

(CSIR)

OPRI

(RESEARCH) MoFA

IN& PUT TECHSUNIPPLCAIERL^

SUPPORT

FERTILIZERS etc

InpuTect Supphnicalierl &

MaSuppochinery etcrt MoTI

Financiers

NGOs

Logi stics

Workers Unions

Communities

Regi onal Orgs.

Global Orgs.

Media

Provide Cross-cutting

Service

Wholesaler Retailer
Exporter provide specific
service

NURSERIES

PRODUCERS

PROCESSORS

(CPO &PRO)

End UserSoap, Edible oil, etc

Consumers

Lux, Frytol, Jomil etc

MEST

(CSIR)

OPRI

(RESEARCH) MoFA

Fertilizers etc^

InpuTet Suppchnicalierl &

Support

Machinery etc

MoTI

Financiers

NGOs

Logi stics

Workers Unions

Communities

Regi onal Orgs.

Global Orgs.

Media

Provide Cross-cutting

Service

Wholesaler Retailer
Exporter provide specific
service

InpuTectShniupplcaier&l

Support