Agribusiness Roadmap and Action Agenda

1. AGRI-BUSINESS
ROADMAP & ACTION
AGENDA
Oscar Aleson Torralba
Management Association of the Philippines
Presented at the 2nd LGU Conference
Organized by the National Competitiveness Council
27 February 2009

2. 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)
2

3. 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.
3

4. 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.
4

5. 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.
5

6. ROADMAP STEP-BY-STEP APPROACH
STEP 1: Ascertain Public- • Identify convening agents
Private Sector Commitment • Hold municipal competitiveness conference
• Form the working group
• Identify and provide financial and other resources
• Define the assessment area
STEP 2: Participatory • Conduct biophysical and socio-economic survey
Resource Assessment • Collect secondary data
• Collect primary data
• Write report
• Prepare resource map
• Define area zones
• Value chain mapping
STEP 3: Supply Chain
• Quantify and describe value chains in detail
Analysis • Economic analysis of value chain
Based on Competitiveness Analysis Attributes
STEP 4: Formulate • Cost • Quality
Strategic Objectives • Supply reliability • Appropriate Innovation
• Customer service
6

7. 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
7

8. 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
8

9. STEP 2: Rapid Participatory
Resource Assessment
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.
9

10. Step 2: Rapid Participatory Resource Assessment
Sample working group members & linkage to enterprise groups.
Specialists
Working Group
Facilitator of Traders/
Policy and
the process entrepreneur
Implementation
Finance
Development agencies
Chamber of
commerce
Government NGOs
Agencies
Research
BDS PA BDS FA BDS FA
FG FG FG FG FG FG FG FG FG
FG FG FG FG Farmer FG FG
groups
10

11. STEP 2: Rapid Participatory
Resource Assessment
Form the Survey/Assessment Team
11

12. STEP 2: Rapid Participatory
Resource Assessment
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
12

13. STEP 2: Rapid Participatory
Resource Assessment
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
13

14. STEP 2: Rapid Participatory
Resource Assessment
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
14

15. STEP 2: Rapid Participatory
Resource Assessment
Elements of Resource Survey
Natural resources
Water sources
Relative productivity of soils
Seasons (wet & dry)
15

16. STEP 2: Rapid Participatory
Resource Assessment
Elements of Resource Survey
Productive resources
Roads
Infrastructure
Major businesses with agricultural links
Support services
Transport for produce (frequency, costs and
quality)
Markets
16

17. STEP 2: Rapid Participatory
Resource Assessment
Elements of Resource Survey
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
17

18. STEP 2: Rapid Participatory
Resource Assessment
2-5 Place the Information on a Resource Map
18

19. STEP 2: Rapid Participatory
Resource Assessment
2-6 Define Zones for the Area
Zoning 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
19

20. 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
20

21. STEP 3: Supply/Value Chain Analysis
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.
21

22. STEP 3: Supply/Value Chain Analysis
Consumption
s
c tor
s/A Retailing
on
n ct i
n Fu
i
C ha Trading Research
p p ly
Su Transportation
Processing
Communications
Trading Market information & intelligence
Tech. & business training & assistance
Post harvest
handling Government policy regulation
s
ce
Financial services ervi
Production S
p ort
Production input supply Sup
22

23. STEP 3: Supply/Value Chain Analysis
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.
23

24. STEP 3: Supply/Value Chain Analysis
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)
24

25. STEP 3: Supply/Value Chain Analysis
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).
25

26. STEP 4: Formulation of Strategic
Objectives/Value Chain Upgrading
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
26

27. STEP 4: Formulation of Strategic
Objectives/Value Chain Upgrading
Formulation of Strategic Objectives
27

28. STEP 4: Formulation of Strategic
Objectives/Value Chain Upgrading
Example 2:
Supply Chain Segment: Production
Competitiveness Attribute: Supply Reliability
Strategic Objective: Increase hog production
by 20% in 2009
28

29. OSCAR
O – Objective Assessment:
Delivery Objective
S – Strategy Menu
C – Choice of Strategy
A – Act
R – Review
29

30. 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.
30

31. Key Issues and Proposed Action
Agenda by Supply Chain Approach
K ey Issu es b y A c tio n a g e n d a
S u p p ly C h ain N a tio n a l L e ve l L o c a l L e ve l
S eg m en t/
B asic F un ctio n
a . In p u t S u p ply
b . P ro d u c tio n
c . P ro c e s sin g
d . M a rke ting
e . L o gistic s
f. C o n su m p tio n
31

32. You cannot be competitive in
the world if you cannot be
competitive in your country.
Mr. Michel Camdessus
Former Managing Director,
International Monetary Fund (IMF)
Honorary Governor
Banque de France
Open Forum of the MAP CEO Conference, 7 Oct. 2008
32