Coordination and Structure of Agri-Food Value Chains: Analysis of Banana Value Chain Strands in Tanzania

Abstract

The strong coordination and structure of agri-food value chain increase smallholder farmers’ access to resource endowments and markets for their produces which in turn improve production and marketing efficiency of the  agri-food products. Following the mapping of banana value chain actors, the cross sectional information from Rombo District in Kilimanjaro region were quantitatively analyzed based on 209 responses consist of farmers, wholesalers, retailers, brokers and processors. The overall result showed that, the absence of contracts has led vertical coordination between actors of banana value chain to be weak; the loose coordination prevent the actors to enjoy the economic incentives of the value chain as a result farmers cannot deliver enough bananas to processors and traders. Lack of farmers’ group associations which deal with bananas resulted to poor functioning of horizontal coordination of banana value chain in the study area. Prices and margins obtained by different actors along the chain varied significantly with the wholesalers captured higher mean price difference. The study recommends on strengthening and establishment of vertical and horizontal coordination among actors in order to have strong value chain structure for efficiency improvements.

Keywords: Agri-food, Coordination and Structure, Value Chain, Banana, Market margin, Tanzania