Upgrading a Coconut Value Chain: Empirical Evidence from North Kerala

Abstract

There is a need to empower the coconut farmers to overcome structural constraints of the sector in terms of fragmented holdings, non-uniform levels ofknowledge, skill and resources, and prevalence ofnon-transparent and multi-node marketing channels, to become globally competitive. Utility of a value chain framework in this regard was tested under World Bank assisted National Agricultural Innovation Project on 'Value Chain in Coconut' which was implemented in Kasaragod district of Kerala. Baseline survey was conducted to benchmark and to identifY the constraints preventing better value realization in the value chain segments (production, post-harvest handling, processing, and marketing). Upgrading of coconut value chain was achieved through (i) horizontal coordination of important nodes as well as management of human capital, (ii) process upgrading to improve operational productivity; and (iii) product upgrading to improve strategic productivity. In the first instance, 10 Community Based Organizations offarmers were formed that covered 250 ha area and 534 farmers. For increasing the operational productivity, appropriate production technology-interventions such as (a) cultivation of intercrops, (b) growing of leguminous green manure crops in the coconut basin and its incorporation, (c) integrated nutrient management including organic recycling, and (d) need based plant protection measures, were implemented. Average net returns due to enhanced operation al productivity of value chain was Rs.200,201 per ha against the baseline value of Rs.44,981. Product upgrading was achieved through development of 14 protocols for value added products and conducting marketing studies: Four Women Self Help Groups were formed to produce coconut value added products. Value addition through product diversification had the potential to provide a net profit of Rs.200,000 per ha. This study establishes the scope for enhancing coconut value chain productivity through adoption of improved production technologies, better coordination in procurement, and community level processing and thus, will be a benchmark for extension strategies having a value chain perspective.