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Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

EAST DARFUR STATEFebruary 2016

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Table of Contents

Acknowledgements ................................................................................................................ 3

Acronyms .............................................................................................................................. 1

Executive summary ................................................................................................................ 2

1. Introduction ....................................................................................................................... 3

1.1 Background ............................................................................................................................ 3

1.2 Objectives of the analysis ...................................................................................................... 5

2. Definitions and theoretical framework ................................................................................ 6

2.1 Value chain ............................................................................................................................. 6

2.2 Value chain analysis .............................................................................................................. 6

2.3 Value chain mapping .............................................................................................................. 6

2.4 Value chain development ....................................................................................................... 6

2.5 Access theory ......................................................................................................................... 7

2.6 Conceptual framework ........................................................................................................... 7

3. Method .............................................................................................................................. 8

3.1 Study area ............................................................................................................................... 8

3.2 Research design ..................................................................................................................... 8

3.3. Data collection ....................................................................................................................... 9

3.4. Triangulation ....................................................................................................................... 11

3.5 Data analysis ........................................................................................................................ 11

3.6 Data presentation ................................................................................................................. 12

4. Results ............................................................................................................................ 13

4.1 Overview of Gum Arabic production in East Darfur ............................................................. 13

4.2 Structure of the Gum Arabic value chain ............................................................................. 15

4.3 Distribution of benefits and access analysis ...................................................................... 24

4.4 Constraints and bottlenecks ................................................................................................ 30

5. Conclusions and recommendations .................................................................................. 33

5.1 Conclusions .......................................................................................................................... 33

5.2. Recommendations .............................................................................................................. 34

References ........................................................................................................................... 36

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List of Tables

Table 1: Types of actors, genders and locations

Table 2: Gum Arabic value chain actors and their activities

Table 3: Socioeconomic characteristics of the surveyed actors in the Gum Talha value chain

Table 4: Estimates of Gum Talha production in the surveyed localities (2016)

Table 5: Taxes and duty fees on gum Talha for 2013 and 2016, and beneficiaries

Table 6: Gum producers’ average yields, costs and profits (n꞊130)

Table 7: Village trader's average prices, costs and profits (n꞊50)

Table 8: Town trader's average prices, costs, profit (n꞊15)

Table 9: Mechanisms for maintaining and controlling benefits

Table 10: Constraints and bottlenecks, as identified by producers

Table 11: Recommended interventions in response to particular constraints and bottlenecks

List of Photos

Photo 1: Group discussion with gum producers in Um Sigayi weekly market

Photo 2a: A producer holding an axe

Photo 2b: A wound on a Talha tree

Photos 3a and 3b: Sticky gum from the Talha tree

Photo 4: Natural stands of Talha (A. seyal) in Gemayzia, Abu Jabra locality

Photo 5: A taya in the forest

Photo 6: An agent at Sinaidira in El-firdos locality

Photo 7: An old A. senegal tree (Hashab)

Photo 8: A female gum producer selling gum to a village trader in Boro market

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List of Figures

Figure 1. The conceptual framework

Figure 2: The area covered by the study

Figure 3: The sales channels for Gum Talha from East Darfur

Figure 4: Gum production costs (%)

Acknowledgements

The author, Dr. Yahia Omar Adam, is very grateful for the cooperation and support of the staff of the United Nations Environment Programme (UN Environment) and the Forests National Corporation (FNC) in Ed Daein who facilitated the field survey and accompanied me to the sites of the 'Natural Resource Management for Sustainable Livelihoods' project in East Darfur. The consultant also extends his gratitude to the UN Environment team in Khartoum.

Thanks also go the enumerators for their intense commitment over long hours in difficult conditions. In particular, thanks are extended to Mr. Adam Ibrahim, Mr. Mohamed Abuelgasim, Samia Madibo and Salma Abdulrahman from the FNC. Special thanks go to the drivers (Yosif and Mohamed) who ensured the field travel was on schedule.

Appreciation is also extended to Mr. Abdalla Adam Osman (the Director of the FNC East Darfur) and Mr. Abdalla Hemidan (Project Manager, UNOPS) for their diligence and assistance during the data collection. Very special thanks are also extended to all of the traditional leaders who accompanied and introduced us to the local people in the visited areas. My thanks also go to all the actors who deal with Gum Talha activities in the study areas for their welcoming reception and their provision of the required data.


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Acronyms

entigradedegrees cC o

FNC Forests National Corporation

GAC Gum Arabic Company

MT metric tons

NGO non-governmental organization

NTFP non-timber forest product

SDG Sudan ginah (USD 1 = 6.4 SDG)

UNEP United Nations Environment Programme

USD United States dollar

VCD value chain development

WFP World Food Programme


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Executive summary

This report describes the findings of a comprehensive and detailed value chain analysis for gum Talha, which sought to: i) identify the product chain, the actors involved, their activities and framework conditions; ii) determine the economic benefits and their distribution among the actors and how these benefits are maintained and controlled; iii) identify key constraints and bottlenecks and propose potential market-based solutions to develop the market chain of gum Talha; and iv) suggest interventions and a framework to develop the gum Talha value chain so as to increase benefits for the producers and the other actors.

The study, conducted in February 2016, used snowball sampling to select 197 study participants (130 producers, 50 village traders, 15 town traders/agents and two companies/exporters) along the value chain. Primary data was collected using semi-structured interviews, key informant interviews, group discussions and direct observations. The quantitative data was analyzed using SPSS version 20 and Excel 2010, while qualitative data was analyzed using text analysis.

The actors in the Gum Talha value chain include producers, village traders, town traders/agents, companies/exporters and consumers in international markets. The study found that the profit margin for the rural collectors was 48.76 per cent, while that for village traders was 54.94 per cent, and that for town traders was 6.4 per cent. The main cost items for the rural producers include food (45 per cent), labour (22 per cent), drinking water (18 per cent), gum transportation (9 per cent), medication (4 per cent) and tapping tools (2 per cent).

The study identified the major constraints and bottlenecks at the local level as: low gum prices, lack of market information, lack of producers' organizations, lack of financial credit, lack of training on gum cleaning and drying, lack of drinking water, low regeneration capacity of Hashab trees and poor tree management. The report concluded that the Gum Talha market chain profits mainly the processors and exporters.

In view of the study findings, the following interventions are recommended: establish drinking water points; build the capacity of gum producers; develop a market information system; facilitate access to financial credit and establish Talha stands (with community involvement).


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1. Introduction

1.1 Background

Non-timber forest products (NTFPs) have received greater attention in recent decades due to their potential to contribute to rural livelihoods and national economies (Arnold and Perez, 2001). The forests and woodlands of Sudan are a potential source for NTFPs and the sound development of these products could have a significant impact on livelihoods (Adam et al., 2013), especially among poor communities in dry land areas who have few options for economic development due to harsh climatic conditions (Adam, 2015).

NTFPs extracted from the woodlands of Sudan are consumed and traded locally and are also exported. Gum Arabic is one such NTFP. Gum Arabic not only offers an income and indemnity to farmers against seasonal fluctuations in the prices of their agricultural products (FAO, 2011), but is also an important source of foreign exchange to Sudan, annually injecting between 100 and 120 million USD into the economy, making it the most important NTFP in Sudan (Abdelmagid, 2014).

Prices in the international market for Gum Arabic have fluctuated greatly year to year, however, and production of Gum Arabic saw an overall decline in the three decades between 1970 and 2000. Between 1969/70 and 1973/74 production declined from about 35,000 tons to about 23,000 tons. This decline was reportedly due to drought. In subsequent years, production fluctuated and in 1984/85 fell to 11,000 tons, again due to drought. Production continued to decline overall, and in 1991/92 fell to about 7,000 tons. This time the decline was attributed to locusts. Subsequently, prices for Gum Arabic rose and production increased to about 39,000 tons in 1994/95. When prices fell, however, production declined accordingly, reaching a low of about 3,000 tons in 1999/2000.

Gum Arabic is mostly produced by rural producers in traditional rain-fed farming areas, including in Gedarif, Sinnar, Blue Nile, White Nile, all three states of Greater Kordofan and all five states of Greater Darfur. These areas contain up to 20 per cent of Sudan’s population, or around 6 million people, who are among the poorest and most vulnerable in the nation in terms of food insecurity (Couteaudier, 2007).

Gum Arabic is derived from two acacia species: Acacia senegal, known locally as Hashab, and Acacia seyal, known locally as Talh. Both species spread naturally in the central belt of the low-rainfall savannah where they grow in pure or mixed stands; in clay plains in the east and sandy soils in the west. Gum Arabic from Hashab is of higher quality and is mostly produced from trees grown on farmers' fields. Talh is more likely to grow wild, along the Nile as well as in Darfur, and to be tapped in the wild. According the field survey findings, annual yields of gum from Talh trees range between around 200 and 400 grams. The trees are exploited from the ages of 5 to 25.

Gum is produced by the trees in response to wounds; gum sap exudes to protect the tree (Abdel Nour, 2013). Exudation of gum often occurs naturally in response to damage caused by animals,


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insects, etc. Harvesting of gum by humans requires first wounding the trees using an axe (sunki). In Sudan, the wounding (tapping) of trees begins at the end of the rains and before the cold spell in October/November when tree growth stops, leaves are shed and trees begins the dormancy stage. In Darfur the season for tapping is November to May. The first harvest is four to six weeks after tapping and then gum is collected every 10 to 14 days, with between six and 12 collections each season (Seifel Din and Zarroug, 1996). The tapping process is normally carried out by hired labour (nafir) but collection of the gum is carried out mainly by family labour.

Gum Arabic production is one of the most important activities of the savannah forests of central Sudan. The significance of the income gained from gum production is that collection of Gum Arabic is carried out during the dry season. The activity therefore does not compete with farming activities. This allows farmers to make use of their slack period and acquire supplementary income. The activity employs all members of the family for between four and six months per year and provides seasonal labour for people from other parts of the country, who migrate to the gum belt area during the season.

Gum Arabic is sold by the producers (those who tap, collect, transport the gum) to local merchants, who in turn sell the product to town merchants (middlemen) and agents, who sell it to exporters and processing companies.

The producers generally transport their gum (using animals) to the village merchant who pays for it in cash or in kind. These transactions take place outside the organized and governmental-controlled markets. Thus, most producers do not receive the fixed minimum price; they get inadequate prices for their products. The local merchant serves as a link between the producers (who are unable to contact town merchants directly) and the town merchants who buy the gum and undertake the cleaning, grading, repackaging and sorting processes and who transport the gum to exporting companies. Very little Gum Arabic is consumed domestically and Sudan commands over 60 per cent of the world's Gum Arabic production and trade.

According to the Gum Arabic Board, at least 30 per cent of the Gum Arabic traded in Sudan is produced in Darfur. East Darfur is a particularly important production area for talha, from the Acacia seyal tree. According to Forests National Corporation (FNC) records, of the 32,000 metric tons (MT) of Gum Arabic produced 2014, 26,000 MT came from A. seyal and the remaining 6,000 MT came from A. senegal.

Gum Arabic and other natural resources have the potential to contribute significantly to the local rural economy in East Darfur as well as to the national economy, but this potential has not yet been fully exploited due to constraints on the commodity value chain.

The key factor affecting Sudan's Gum Arabic sector has been the national government policy for the product, particularly the domestic marketing arrangements and pricing (Buchanan-Smith et al., 2013). Low prices encouraged cross-border smuggling of Gum Arabic, especially from Darfur to Chad. In 2009, the Government of Sudan liberalized trade in Gum Arabic and committed to


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abolishing the export monopoly held by Gum Arabic Company (GAC). This liberalization had an immediate positive impact on producer prices.

The World Bank had long sought to boost the Gum Arabic sector in Sudan and was the major advocate of the liberalization of gum Arabic market to end the GAC's monopoly. The Multi-Donor Trust Fund (MDTF) managed by the World Bank co-funds work to boost Gum Arabic production in 11 localities in North and South Kordofan, White and Blue Nile, and the states of Sinnar and South Darfur, in collaboration with the International Fund for Agricultural Development (IFAD).

1.2 Objectives of the analysis

Against this background, the UN Environment conducted a Gum Talha value chain analysis in East Darfur, aiming to identify areas of intervention and recommendations for Gum Talha value chain development, so as to increase gum production, improve producers' market competitiveness and sustain gum Arabic producers' livelihoods.

The specific objectives of the analysis were to:

x Identify the product chain, along with actors involved, their activities and framework conditions.

x Determine the economic benefits distributed between actors and how these benefits are maintained and controlled.

x Identify key constraints and bottlenecks and propose potential market-based solutions to develop the market chain of gum Arabic and thereby improve livelihoods.

x Identify appropriate interventions and a suitable framework to develop the gum Arabic value chain so as to increase the benefits for producers and other actors.

Value chain approaches are utilized by development practitioners and researchers to capture the interactions within increasingly dynamic and complex markets and to examine the inter-relationships between the diverse actors involved (Kaplinsky, 2004; Bolwig et al., 2010). By going beyond firm- or activity-specific analysis, value chain analysis allows for an assessment of the linkages between and among productive activities. The value chain approach thus provides a framework to analyze the nature and determinants of competitiveness in value chains in which small producers participate. It also provides the basic understanding needed for designing and implementing appropriate development programmes and policies to support their market participation. Indeed, many development interventions now utilize the value chain approach as an important entry point for engaging small producers, individually or collectively, in export markets for high-value products (Amanor, 2009).


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2. Definitions and theoretical framework

2.1 Value chain

A value chain is the set of activities and links that are involved in a particular product being created, delivered to consumers and disposed of afterwards (Kaplinski and Morris, 2002). These activities include bringing inputs and services together to grow, transform or manufacture a product; transporting the product from the producer to the customer; and increasing the value of the product.

2.2 Value chain analysis

Value chain analysis is a process of examining each part of the production and sales process of a product, from design to distribution, to identify where improvements can be made. It also examines overall revenue and gross physical output, as well as net value added and the distribution of burden or benefit (Webber and Labaste, 2010). Value chain analysis can be used for a wide variety of purposes, from improving business results to examining inequalities in global income distribution (Kaplinsky and Morris, 2002).

2.3 Value chain mapping

The purpose of value chain mapping (VCM) is to develop a visual presentation of the actors and their activities and the connections between the actors, as well as of how benefits are distributed. Value chain mapping enables one to understand the relationships between the various stakeholders (actors), the flow of products and values, the services and the business regulations that are crucial to the functioning of the value chain.

2.4 Value chain development

Value chain development (VCD) is a process by which the performance of the value chain is enhanced through various interventions (Poschen, Sievers and Abtew, 2014). VCD includes intentional efforts to build win-win relationships between two or more chain actors (producers, distributors, processors, wholesalers and retailers) so as to strengthen mutually beneficial business relationships. The stronger the resulting win-win outcomes, the more likely the business relationships are to endure and thrive over time.

There are numerous ways of developing a value chain, including: process, product, functional and chain upgrading. Process upgrading focuses on increasing the efficiency of production, within links and between links in the value chain. Product upgrading refers to enhancing the quality and specifications of the product, whether by creating an entirely new product or by improving the old product. Changing the scope of activities carried out within the firm as a means of adding value is functional upgrading. Chain upgrading can involve a move into a new value chain altogether by using the skills gained from participating in an existing value chain. Product and process upgrading are the most common VCD strategies, while functional upgrading is difficult to achieve (Mitchell, Keane and Coles, 2009).


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2.5 Access theory

Property rights are key in determining the use of resources and they influence the behaviour of resource users. Access theorists argue, however, that “access” is also essential in the derivation of benefits from resources. “Access” can be defined as "the ability to derive benefits from things" (Ribot and Peluso, 2003). Following the "theory of access", it is necessary to examine the power relations in value chains as well as the rights of the stakeholders.

2.6 Conceptual framework

The analysis used the value chain analysis (VCA) framework of Kaplinsky and Morris (2002).

The analysis of the gum Arabic value chain in East Darfur included the following steps:

x Mapping of the activities in the chain and characterizing the actors participating in the chain.

x Identifying the constraints and bottlenecks in the value chain, and appropriate VCD strategies to overcome these.

x Identifying who benefits from participation in the chain, and assessing how the distribution of benefits would be influenced by restructuring the chain through various upgrading strategies (Rich et al., 2011).

Figure 1 illustrates the conceptual framework for the value chain analysis.

Figure 1. The conceptual framework

Enabling environment

Producer Village Trader

Agency/ exporter

Town Trader Consumer

Costs, margins, constraints/bottlenecks

Value chain development based on constraints/bottlenecks (Vertical & Horizontal Development)


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3. Method

3.1 Study area

The study was conducted in the state of East Darfur in Sudan. The state shares borders with the Republic of South Sudan in the south, West Kordofan in the east, North Darfur in the north-west

and South Darfur in the west (Figure 2). East Darfur occupies a total area of 53,000 km2 and has a population of around 1.3 million. Summer (dry season) starts in March and ends in May, with an average daily temperature of 40o C. The rainy season starts early in June and ends in October.

East Darfur has a rich savannah region in the south and a poor savannah in the north and has diverse livelihood resources, including Gum Arabic,

fisheries, livestock and agricultural land. The main land uses are animal husbandry, agriculture and forestry. Almost three quarters (70 per cent) of the population are farmers and pastoralists, who depend on natural resources for their livelihoods. The capacity of farmers to produce food is limited by erratic rainfall, low soil productivity and inadequate technology, together with an inefficient marketing system and lack of financial support. The main agricultural schemes are Um Ajaja, with an area of 100,000 feddan, and Abu Fama, with an area of 36,000 feddan. Livestock ownership indicates wealth and prestige. The types of livestock owned include cattle, sheep, goats and camels. Forests cover an area of 4,321,000 feddan (31 per cent of the state’s total area) (Personal communication, FNC, 2016).

3.2 Research design

The case study approach was employed. Beginning with local Gum Talha producers who collect gum, the analysis traced the chain of actors and processes to the final domestic and export market in the country. The units of analysis were thus groups of actors at different levels in the value chain. The case study approach was considered to be appropriate because value chain analysis is explorative study that needs multiple sources of evidence for in-depth understanding of the processes, outcomes and components along the value chain.

Figure 2: The area covered by the study


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3.3. Data collection

The researcher reviewed the literature on the Gum Talha sector in Sudan so as to understand the general situation at the national level and identify the key issues. Subsequently, the researcher gathered information from stakeholders and secondary sources so as to make a preliminary identification of the various stages (e.g. collection, processing and trading). The identification of the actors directly involved in the Gum Talha value chain was undertaken in consultation with UN Environment, the Forests National Corporation and key informants in East Darfur. Data were collected using a combination of participatory rural appraisal tools.

Primary data were gathered using interviews, group discussions and direct observations. The sources of primary data included Gum Talha producers, village traders, town traders, processors and wholesalers/exporters. Interviews were conducted with people who had first-hand information about the production and consumption of gum Arabic in the study area (“key informants”). This data informed the initial mapping of the value chain.

The key informants for this study were selected using the snowball sampling technique, whereby participants identify other respondents. It is an informal method, particularly relevant in qualitative, explorative and descriptive research using interviews. The use of snowball sampling limits the validity of the sample, however, due to non-random sampling and bias towards the inclusion of individuals with relationships. These limitations were mitigated by increasing the number of respondents and using additional methods and sources for triangulation.

Semi-structured in-depth interviews were held to collect primary data from value chain actors at each stage. Information collected included the characteristics of actors, the cost of inputs, price of outputs, the mechanisms of access, intra-group integration and their links to upper and lower stages in the chain, and the processes at each stage. The interviews were conducted based on semi-structured questionnaires followed by additional questions (depending on the responses) to clarify or expand on particular issues of interest. The number of in-depth interviews conducted during the study was 197. In addition, informal conversations were held with local community members.

A summary of the key information collected about the respondents’ via the in-depth interview is presented in Table 1.


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Table 1: Types of actors, genders and locations

Group discussions were held with the village committees (five to 10 members), tribal leaders (sheikhs and omdas) and local community members and producers in each of the study areas (Photo 1). The focus of the discussions was on the production and trading of Gum Arabic, market potential, and the opportunities and constraints along the chain.

Photo 1: Group discussion with gum producers in Um Sigayi weekly market © Photo credit: Yahia Omar Adam

Secondary data was collected (on production, trading, taxes and other fees, and related issues) from FNC offices, locality finance offices, NGOs working in the area, the Ministry of Agriculture, the customs authority, internet sources and from previous related research works and other relevant sources.


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Direct observations were made of the process of producing Gum Arabic in the forests, as well as of sales in the market places, and of cleaning and packaging by labour employed by agents. These gave the researcher an insight into the production and trade of the product. These activities and the interactions between the actors were observed and in some cases recorded using digital cameras. This non-participant observation provided accurate information and was used to check the information collected through the interviews, especially in relation to sensitive topics such as prices and benefits.

3.4. Triangulation

The combination of approaches and data collection tools employed for the study, and the multiple sources enhanced the validity and reliability of the information collected and allowed triangulation of data, especially on sensitive issues like prices, gum quantities, benefits, costs, and the interactions between different actors. For example, the selling prices provided by respondents were cross-checked with information about the buying prices. Additional investigation was carried out when there were discrepancies.

3.5 Data analysis

The data analysis process involved:

x Mapping the value chain and preparing a graphic presentation of the various actors involved in the chain, their principal activities, links between them and the framework conditions.

x Quantifying the physical flow, value added and distribution of benefits along the chain.

x Mapping access and identifying and presenting the various mechanisms used by actors to gain control and maintain access to benefits.

The initial mapping involved:

x Identification of rural markets.

x Identification of key functions and activities.

x Identification of the actors performing each function.

x Mapping the actors according to the functions they perform.

x Mapping links between participants.

The initial map of the value chain was developed with inputs from key informants, then was further refined by supplementing detailed information derived from the responses to the in-depth semi-structured interviews with value chain actors and field observations.


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3.5.1. Estimates of costs and margins

The production, marketing and processing costs were estimated based on formulas (see below). The costs comprised the following components: collection, labour, drinking water, food, transportation, taxes, duty fees, processing and packing materials.

𝐺𝑢𝑚 𝐴𝑟𝑎𝑏𝑖𝑐 𝑝𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛, 𝑝𝑟𝑜𝑐𝑒𝑠𝑠𝑖𝑛𝑔 and 𝑚𝑎𝑟𝑘𝑒𝑡𝑖𝑛𝑔 𝑐𝑜𝑠𝑡𝑠= 𝑐𝑜𝑙𝑙𝑒𝑐𝑡𝑖𝑜𝑛 𝑐𝑜𝑠𝑡 + 𝑙𝑎𝑏𝑜𝑢𝑟 𝑐𝑜𝑠𝑡 + 𝑡𝑟𝑎𝑛𝑠𝑝𝑜𝑟𝑡𝑎𝑡𝑖𝑜𝑛 𝑐𝑜𝑠𝑡 + 𝑑𝑟𝑖𝑛𝑘𝑖𝑛𝑔 𝑤𝑎𝑡𝑒𝑟 𝑐𝑜𝑠𝑡+ 𝑡𝑎𝑥𝑒𝑠 + 𝑍𝑎𝑘𝑎 + 𝑝𝑟𝑜𝑐𝑒𝑠𝑠𝑖𝑛𝑔 + 𝑒𝑡𝑐 …

The quantitative data regarding the cost benefit structures, value added, benefit distribution were estimated using the formula below. Gross margin was calculated as an indicator for benefit distribution along the value chain.

𝐺𝑟𝑜𝑠𝑠 𝑚𝑎𝑟𝑔𝑖𝑛 = 𝑅𝑒𝑣𝑒𝑛𝑢𝑒 − 𝑡𝑜𝑡𝑎𝑙 𝑐𝑜𝑠𝑡𝑅𝑒𝑣𝑒𝑛𝑢𝑒 × 100

3.5.2. Estimates of value added

The added value was calculated based on buying and selling prices. The International Institute of Rural Reconstruction (2008) defines value added for a particular actor as the price received by the actor minus the price paid by the actor. Thus, value added gained at each stage along the chain as the commodity flows through the respective stage along the chain was estimated using the following formula (Bockel and Tallec, 2005):

𝑉𝑎𝑙𝑢𝑒 𝑎𝑑𝑑𝑒𝑑 = 𝑆𝑒𝑙𝑙𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 − 𝐵𝑦𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒

3.6 Data presentation

Quantitative data was analyzed using the Statistical Package for Social Science (SPSS) version 20 and Microsoft Excel while text analysis was applied for qualitative data. The results of the study were presented in the form of tables, diagrams, figures and text.


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4. Results

4.1 Overview of Gum Talha production in East Darfur

4.1.1 Tapping and collection

The tapping of the Talha tree involves wounding the tree trunk, using a traditional tapping axe to make an incision in the bark (Photos 2a and 2b).

Photo 2a: A producer holding an axe; Photo 2b: A wound on a Talh tree © Yahia Omar Adam

According to the surveyed producers, tapping is practiced during the dry season. It begins after the rains at the end of October or in early November. At this time the trees have started to shed their leaves. Tapping ends before the rainy season begins (i.e. end of May or early June). The production season is six months long but depends on the onset and end of the rains. Producers usually observe weather conditions before starting gum collection. The season of tapping and collection of gum corresponds with the off-season in the study area, when there are no significant rain-fed crop production activities.

The first harvest of gum nodules is collected two weeks after tapping. Gum continues to exude from the same injured spot and is collected every seven days. Gum is harvested from each tree between six and 12 times during the season.


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4.1.2 Drying, cleaning and packing at the production site

The gum collected from the trees is taken to a local camp called the “taya". Here the producers pack the collected gum in plastic sacks with 100 kg capacity (two guntars) in preparation for transport to the nearest agent. The average amount of gum each producer takes to the market per week is estimated at three guntars. It was observed that the producers do not undertake practices related to drying and cleaning at the production site. The granules therefore get stuck together and turn black, which is not the desired colour of pure gum (Photos 3a and 3b).

Photos 3a and 3b: Sticky gum from the Talha tree © Yahia Omar Adam

4.1.3 Production arrangements

Gum production in the study areas is conducted from natural stands of A. seyal (Talha trees) (Photo 4). These stands in natural woodlands are tribal or state property, so permission is required from the tribal leader (e.g. omda or sheikh) to undertake tapping and collection of gum. The permission is issued by the leader based on the agreement signed between the producers and tribal leaders in each village.

Photo 4: Natural stands of Talha (A. seyal) in Gemayzia, Abu Jabra locality © Yahia Omar Adam


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Normally, tribal leaders distribute the forested land to their people for gum production. The distributed areas range in size between five and 150 feddan, based on the capacity of the producers to tap the area. Such area distribution and demarcation is very important for avoiding conflicts between producers. In addition, it ensures the property remains with the tribal leaders. However, the benefits shared between the producers and the tribal leaders are not clear.

Tapping is normally done by “taya”, i.e. the areas where the producers establish camps for cooking, sleeping, collection and packing of the gum (Photo 5). Each taya covers an area of about 150 feddans. Depending on the density of the A. seyal trees, five to ten producers work in one taya. The camps are established in central places for ease of access to the entire production area and for the transport of the gum to weekly markets or agents in urban areas.

Photo 5: A taya in the forest © Yahia Omar Adam

4.2 Structure of the Gum Talha value chain

4.2.1 Actors, their characteristics and activities

The value chain of gum produced and sold in East Darfur has three parts: production, cleaning and distribution.

The study revealed that the gum Arabic value chain comprises eight major groups of actors, as follows:

i. Gum producers (those who produce gum on forested land with production permission). ii. Traders at the local level (village traders).

iii. Traders at the town level (middlemen, agents of urban merchants). iv. Sellers to agents. v. Agents (buyers for processors).

vi. Manufacturers and exporters (processing companies and other commercial enterprises); vii. The government (FNC, Tax office, Zakat administration).


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viii. Tribal leaders.

The actors engaged in the value chain and their activities are presented in Table 2.

Table 2: Gum Talha value chain actors and their activities

Actors Activities

Producers Tree tapping, gum collection, packing, bringing gum to weekly markets

Village traders Weighing, sorting, packing, collecting gum for agents

Town traders Gum collection from village traders, cleaning, sorting, repacking, weighing, transport, fee and tax paying

Agents Gum collection, cleaning, sorting, repacking, weighing, transport, fee and tax paying

Exporters Processing, grading, repacking, export fees, transport

As observed in the field, producers take the gum to the village weekly markets, and sell it to village traders, middlemen and brokers who, in turn, sell the gum to agents. Some of the village and town traders deal with all weekly markets and others buy from just one or two markets, depending on their capital and the transaction size. The agents purchase Gum Arabic on behalf of processing companies and other commercial enterprises. The main locations where agents bought the gum in the visited areas were Abumatarig in Bahr Al Arab locality and Sinaidira in El-firdos locality (Photo 6).

Photo 6: An agent at Sinaidira in El-firdos locality © Yahia Omar Adam


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In East Darfur State, Talh trees are found in pure stands, especially in Um Ajaja administrative Unit (Abu Jabra locality), while Hashab trees are scattered (Photo 7). Therefore, much less Hashab gum is available in East Darfur than Talh. Some Hashab gum is imported from South Darfur State, especially from Boram locality, but only in small quantities. Some areas in East Darfur have more Hashab than the areas covered for the study, but those areas, including the eastern localities (Abu Karinka, Yassin, etc.), were not covered by this study for security reasons.

Photo 7: An old A. senegal tree (Hashab) © Yahia Omar Adam

The majority of traders have relationships with producers that begin before tapping, while some traders begin their relationships with producers only when buying gum in the rural markets. The majority of traders provide producers with an interest-free loan, followed by sharing and finally by the Shail system in which the payment is made either in cash or cash plus food before the gum producer harvests the gum. Most traders in Gemazyia (Abu Jabra locality) have shops in gum collection areas. This strategy is very important for securing the supply of gum at very low prices without competing with other traders.

The agents buy the Gum Arabic for processing companies in return for a commission. The processing companies are significant buyers of Gum Arabic by virtue of their financial capacity and the available cash they have for payment. The agents do not deal directly with the producers or with village traders.

The socioeconomic characteristics of Gum Arabic actors are believed to have a great impact on their sales decisions as well as on the design and implementation of the interventions for Gum Arabic production and marketing development at the local level.

Gender roles and responsibilities in the study area are influenced by social, economic and cultural factors. The local community in East Darfur is patriarchal and resource ownership is male dominated, but women are heavily involved in economic activities, including agricultural production, fuel wood collection, drinking water collection, and gum tapping and collection.


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Nevertheless, the survey results revealed that the majority of the gum producers are male (69.2 per cent) (Table 3).

Half of the male producers (50 per cent) indicated livestock as their most important income source, but 60 per cent of the female producers considered Gum Arabic as their most important income source (Table 3). While all of the surveyed male producers work full-time on producing and selling Gum Arabic during the season, only half of the female producers do so.

Most male producers (70 per cent) and almost all female producers (90 per cent) have no education, with only 2 per cent of the male producers having completed primary education. Almost a third (28 per cent) of the male producers have Khalwa1 education, however. Around a third (37 per cent) of the village traders have primary education, while 3.1 per cent of town traders have university education (Table 3).

According to the responses from male producers, the average family size at the local level is 9, while for female producers the average is 6, and for village traders the average is 11.

Table 3: Socioeconomic characteristics of the surveyed actors in the Gum Talha value chain

Actors/socio-economic characteristics

Class

Gender

Male

Female

69.2%

30.8%

100%

-

100%

-

Average age

Male

Female

42 years

35 years

36 years 45 years

Education level

Illiterate

Khalwa

Primary

Secondary

Male Female

62.5%

37.5%

10.9%

42.3%

43.7

70%

28%

2%

-

90%

10%

-

-

1 Religious school in which Muslims study the Holy Koran.

P* TT E VT


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Actors/socio-economic characteristics

Class

University - - 3.1% 100%

Marital Status

Single

Married

Divorced

Widowed

Male Female

100%

100%

90%

8.2%

1.8%

100%

-

-

Family Size

Average

Male Female

11

13

9 6

Actor's experience

Average of years

Male Female

6

5

10

15

5

Important income source

Gum

Livestock

Agriculture

Male Female

50%

50%

70%

20%

10%

40%

50%

10%

60%

30%

10%

Gum Arabic production and sales during the

season

Full time

50% of time

25% of time

Male Female

70%

50%

100% 100%

-

-

50%

30%

20%

*P, VT, TT, and E indicate producer, village trader, town trader, and exporter, respectively.

P* TT E VT


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4.2.1 Sales channels for Gum Talha in East Darfur

Gum Arabic produced in East Darfur is sold via various sales channels at the state level, via North Kordofan, in Khartoum and overseas. At the state level, the gum producers and the village and urban traders are the main players (Figure 3).

Figure 3: The sales channels for Gum Talha from East Darfur

4.2.2.1 Gum yields

Yields of gum depend on factors such as the density of the trees, weather conditions (temperature, rainfall, etc), site condition, tapping intensity and frequency, etc. The surveyed producers indicated that they produce three guntars of gum per week (i.e. approximately 150 kg), on average. The total volume of Gum Arabic produced and sold in each locality was estimated based on the information provided by the sheikh in each weekly market visited, as presented in Table 4.


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Table 4: Estimates of Gum Talha production in the surveyed localities (2016)

Locality Market/

Agent Coordinates

Gum Talha Quantities

(guntar)

Gum Hashab Quantities

(guntar) Remarks

Abu Jabra

Um Ajaja N 10 00. 365

E 027 04. 450

Elevation: 313

90,000

-

More gum was

produced in 2016 than in

2015. Gemayzia N 09 53. 846

E 02701. 167

Elevation: 411

60,000

-

Abumatarig

Boro N 1025.877

E 2617.126

Elevation: 434

20,400

Only 10% of trees are tapped

Sharashri N 1045. 402

E 2628.032

Elevation: 369

9,600

4,800

Um Sagyi - 15,000 -

Abumatarig N 1058. 853

E 2612.396

Elevation: 446

527,340

-

El-firdos

Hibail N 1046. 144

E 2603. 120

The most important gum Talh


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Locality Market/

Agent Coordinates

Gum Talha Quantities

(guntar)

Gum Hashab Quantities

(guntar) Remarks

Elevation: 453

38,000 - production area in Bahr

El-Arb Abu

Sinaidira N 1053. 271

E 2551. 187

Elevation: 395

36,000

-

El-firdos - 576,000

TOTAL 853,540 4,800

4.2.2.2 Gum distribution

The gum produced in the study area is sold at local weekly markets to village traders and other middlemen (Photo 8), who then transport the product to agents located in urban areas or directly to El Obied in North Kordofan and/or Khartoum.

The major rural markets for Gum Talha in East Darfur are in Um Ajaja, Gemazayia, Abu Sinaidira, Hibail, Sharashri, Boro and Um Sigiyi. The price for Gum Arabic is fixed by the traders and the producers have no power to negotiate.

Photo 8: A female gum producer selling gum to a village trader in Boro market © Yahia Omar Adam


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From the rural markets, the product is trucked to agents in the region or to urban markets where it is delivered to urban merchants. For example, in Um Ajaja, Sharahri and Abumatarig the agents transport the gum to Elobeid and Khartoum.

Taxes and local duties on Gum Arabic are collected when the product is transported from the market or the agent to El Obeid or Khartoum. The various forms of various taxes and local duties imposed on Gum Arabic are presented in Table 5.

Table 5: Taxes and duty fees on gum Talha for 2013 and 2016, and beneficiaries

Fess/Taxes 2013 (SDG/guntar) 2016 (SDG/guntar) Beneficiaries

FNC tax 7 16 FNC

Zakat 15 24 Central government

State fee 4.5 9.75 State government

Tax on business profit 2.5 S11 Central government

Truck departure fee 0.11 1 State government

Total 29.11 61.75

Sources: Buchanan-Smith et al., 2013; Trader interview, 2016.

4.2.2.3 Gum cleaning and cutting

Urban merchants and agents in Ed Daein buy gum in bulk quantities from local traders and clean it. This cleaning is the only form of processing at the local level. It is undertaken by women and involves removing foreign materials such as bark and other gum, and using an axe to crush the big granules that stick together so as to separate them, then repacking the gum (Photos 9a and 9b).

The cleaning and cutting is very difficult and time consuming. One middle-aged woman reported that the money she receives is not sufficient given the level of effort required to cut the gum and repack it. Women are paid 3.5 Sudan ginah (SDG) per guntar and each woman handles between five and eight guntar of gum each day.


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Photos 9a and 9b: Rural women cleaning and cutting the gum in Abumatarig © Yahia Omar Adam

4.3 Distribution of benefits and access analysis

4.3.1 Producers’ costs, incomes and profit

The study findings indicate that producers make a profit margin of 48.76 SDG per guntar. On average, producers sell 50 guntars per season and their total costs per season are 5,380 SDG. The net income of each producer was estimated at 5,120 SDG per season (Table 6).

Table 6: Gum producers’ average yields, costs and profits (n꞊130)

Item Quantity/value ± S.E

Average yield (guntar/season) 50 ± 43.16

Average food (subsistence) costs (SDG*/season)

Average labour costs (SDG/season)

Average gum transportation costs (SDG/season)

Average drinking water costs (SDG/season)

Average tapping tools costs

Medication costs (SDG/season)

Total costs (SDG/season)

2400 ± 66.79

1200 ± 12.82

480 ± 5.17

1000 ± 0.34

100 ± 0.59

200 ± 0.59

5380


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Cost per guntar (SDG) (Total cost/average selling quantities) 107.6

Average selling price (SDG per guntar) 210 ± 0.16

Total revenue (SDG/season) (average price * average production) 10500

Profit (total revenue – total costs) 5120

Gross margins% 48.76

*1 USD = 6.4 SDG

As illustrated in Figure 4, the largest cost item for producers of gum is food. This item accounts for 45 per cent of total gum production costs each season. The implication of this is that some rural producers must enter into contracts with village traders and agents so as to obtain sufficient food during the production season. Under such contracts, the producers receive loans, either in cash or cash plus food. In return, the producers sell their yields to the village trader or agent in question. Accordingly, the producers lose power to negotiate on the gum price. They must accept the price announced by the trader.

Figure 4: Gum production costs (%)

4%2%

18%

9%

22%

45%

Medication cost Tapping tools cost Drinking water cost

Gum transportation cost Labour cost food cost


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4.3.2 Village traders’ costs, incomes and profit

The study findings indicate that the village traders who buy the gum directly from producers sell the gum for a price of 220 SDG per guntar, on average, and they sell 540 guntars of gum, on average, each season. Accordingly, each village trader has an estimated total revenue of 118,800 SDG per season. The input costs deducted were the purchase value of the product, gum transportation and labour costs. The cost per guntar of gum at the village trader level is 99.11 SDG. Table 7 presents the average prices, costs, incomes and profits of the village traders.

Table 7: Village trader's average prices, costs and profits (n꞊50)


Average selling quantity (guntar/season) 540 ± 16.30

Average gum purchase costs (SDG*/season)

Average labour costs (SDG/season)

Average transportation costs (SDG/season)


Cost per guntar (SDG/season) (Total cost/average selling quantities)

50400 ± 70.90

1200 ± 2.22

1920 ± 7.15

53520

99.11

Average selling price (SDG/guntar) 220 ± 0.22

Total revenue (SDG/season) (average price * average purchase) 118800

Profit (SDG/season) (total revenue – total costs) 65280

Gross margin % 54.94

*1 USD = 6.4 SDG

4.3.3 Town traders' prices, costs and profit

The urban traders each handle about 1,000 guntars of gum per season. As shown in Table 8, when costs are accounted for, town traders earn a net income of 300,000 SDG per season, on average, from their gum trading and distribution operations, with a profit margin of 6.4 per cent. This low profit margin does not include commissions they receive from agents and/or processing companies. The urban traders and agents agree on a commission to be received by the urban trader after transporting gum to the company or to collection points in urban areas, or to Elobeid and Khartoum.


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Table 8: Town trader's average prices, costs, profit (n꞊15)


Average gum sold (guntars/season) 1000 ± 43.16

Average purchase costs (SDG*/season)

Average Transportation costs (SDG/season

Average gum cleaning costs (SDG/season)

Average sack cost (SDG/season)

Average taxes and local duties (SDG/season


220000 ± 66.79

2000 ± 12.82

3000 ± 5.17

25000 ± 0.34

30875 ± 0.59

280875

Average selling price (SDG/guntar) 300

Total revenue (SDG/season) (average price * average production) 300000

Profit (SDG/season) (total revenue – total costs) 19125

Gross margin % 6.4

*1 USD = 6.4 SDG

As noted above, the cleaning of the gum is exclusively performed by female labour. This activity offers full-time employment for many women in urban areas. The women clean between five and eight guntars of gum per day. For each guntar they clean and pack, they receive up to 5 SDG, so get a total of between 25 and 40 SDG per day. The agent in Abumatarig employs between 25 and 40 women per day. Urban merchants also employ between six and eight men each day to load the gum (517 guntars) onto trucks.

4.3.4 Comparison of benefits

Although gum producers put in the most work, they receive the lowest income of all of the actors in the value chain. They spend many weeks away from their homes and invest their energy in a hostile and risky environment during tapping and the collection of the gum, where they are exposed to malaria and poisonous snakes. For the entire production season (five to six months) a producer receives a gross income of only 5,120 SDG which is equivalent to the average income for women who clean the gum. The main reason for the low incomes of the producers is that they are not able to sell their product by themselves to the end users; they must sell to village traders. Producers lack access to market information and traders do not share information with


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them. Because of the long distance to markets and financial limitations, rural producers are not able to transport their gum to urban markets where they could get higher prices, and the lack of alternative credit facilities means they can only obtain loans from village traders. Therefore, they are forced to sell their product to the village traders.

The chain is inefficient in communicating market information, especially to those actors at the base of the chain. The general manger of two companies in Khartoum felt that companies gain a high annual net income from gum owing to their strong financial capacity; physical assets (warehouses in urban centres); social assets, such as strong ties with town traders; backward integration in the chain; and knowledge of the trading structure. The financial resources used in the trading of Gum Arabic come from urban merchants in most cases and are lent to producers and village traders via a traditional share system.

In line with the vertical distribution of benefits, the financial capital required also varies. At the village level, little financial capital is required for production, while at the village trader level the financial requirements are moderate. More capital is invested at the town trader and agent level as they spend more on purchasing, cleaning and transporting the product. Access to credit facilities and financial resources is a limiting factor for all actors along the Gum Arabic value chain. The main sources of capital are informal loans and advances from traders and agents.

The types of A. senegal Gum Arabic sold by exporting companies include: Cleaned, Hand Picked Selected (HPS), Cleaned and Sifted (C&S), Kibbled, Siftings, Dust and Powder. A. seyal Gum Arabic only exists in the ‘Cleaned’ format. A large proportion of Gum Arabic produced in Sudan is exported in its raw form, just ‘cleaned’, ‘handpicked‘ or ‘sifted’. Sudanese Gum Arabic is sold in various parts of the world, including Europe, the USA, India, South America, mainland Asia and Japan.

The lack of local treatment in Sudan is linked to the difficulty of trading processed Gum Arabic on the international market; the coalition of competing international processors who limit the market; and the lack of sufficient financial strength to sustain the processing sector.

4.3.5 Access to benefits

Benefits in the Gum Arabic value chain are derived through access to the natural resources (trees), access to family labour and access to capital and markets. The various groups of actors involved in the Gum Arabic chain use different mechanisms to control and maintain benefits derived from sale of the product, as described below:

x Tribal Leaders: Tribal leaders have direct control over the gum-producing forested areas. They have the traditional right to regulate gum production in terms of allocation of land with trees within the boundary of the village or in the area under their responsibility. This means that they also have the right and the ability to limit access of those who do not belong to their group. The relationship between the tribal leaders and the producers is not clear, but it appears from close investigation with a


29

producer in Boro market that the tribal leaders collect a kind of resource “rent” from producers for the resource use. The amount they collect depends on the productivity and accessibility of the gum production areas. It is not clear, however, how the resource rent that is collected by tribal leaders is used or distributed in the community.

x Producers: Producers who have no property rights gain access to the forest through permits from tribal leaders. The producers establish relationships with village traders, so as to access credit to pay for initial investments in the production process, including food and tools.

x Village traders: Village traders have access to markets and market information. Collection and distribution of Gum Arabic at rural markets needs moderate financial capital to pay for the product and sacks (bags) to pack it in. Village traders and middlemen have access to capital in the form of credit from town traders and agents. Traders in most cases borrow money on behalf of producers, and therefore those producers have to sell their products to them. They also have social ties with producers and town traders as a result of their social identity.

x Town traders and agents: Town traders and agents have access to capital and have knowledge of the quality requirements of exporters due to their access to exporters and their agents. Higher amounts of capital are invested at the town traders' and agents' level for cleaning and packing. They also spend more because they purchase the product in bulk. Town traders use credit arrangement mechanisms and strong social ties with village traders to maintain their access to benefits.

x Forests National Corporation (FNC): The FNC charges traders’ fees and royalties when they transport gum from rural and urban markets. As of 2016, the FNC collected 16 SDG/guntar from those transporting the gum outside East Darfur.

x Government offices: The various government offices charge taxes and other local duties like zakat, state fees and truck departure fees. The responsible government offices do not keep data on the taxes and local duties collected in each locality, however.

Table 9 presents a summary of the mechanisms of access maintenance and control used by the various actors along the gum value chain, as identified in the study.


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Table 9: Mechanisms for maintaining and controlling benefits

Actor Mechanisms

Tribal leaders Control over access to forests

x Traditional and conventional customary right Producers Access to labour

x Social relations for tapping trees (nafir) x Family labour

Village traders Maintenance of access to producers and town traders/agents

x Financial credit arrangements (borrowing and lending)

x Social identity Town traders/agents Maintenance of access to exporters and village traders

x Payment arrangements x Credit arrangements (advance loan) x Access to capital x Social identity x Knowledge of quality standards x Market information control

Forests National Corporation (FNC)

Control the transportation of gum

x Charging fees

4.4 Constraints and bottlenecks

When asked what the main constraints and bottlenecks that they faced were, all of the producers listed low gum prices and lack of market information. Almost all listed the lack of a producers’ organization (95 per cent), lack of financial credit (92 per cent), lack of training on gum tapping and drying (90 per cent) and lack of drinking water (90 per cent), while over three quarters (78 per cent) listed low regeneration capacity of the Hashab tree. Almost a third (30 per cent) of the producers listed inadequate fire lines and stand management (Table 10).


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Table 10: Constraints and bottlenecks, as identified by producers

Constraints/bottlenecks % of producers (n=130)*

Low gum prices 100

Lack of market information 100

Lack of producers organization 95

Lack of financial credit 92

Lack of training on tree tapping and gum cleaning and drying 90

Lack of drinking water 90

Low regeneration capacity of Hashab trees 78

Poor tree resource management 30

*Figures add up to more than 100% as each gum producer mentioned multiple constraints and bottlenecks.

Producers’ profits are affected by the lack of market information and lack of capacity to use such information when available. Some producers are aware that processed gum attracts higher prices and are aware of market requirements but they lack processing skills and preservation equipment. Furthermore, they are unable to transport their gum to markets that offer potentially higher prices and do not have sufficient power to convince the traders and the processing companies to pay higher prices for raw gum.

From direct observations in the field it was clear that roads to connect the production areas with markets are poor and in many cases do not exist. Most production areas are remote, so producers cannot reach markets to trade their gum. Long distances and a lack of roads increase transportation costs, which make the gum market chain associated with high costs and ultimately make the chain unattractive to many actors. A fundamental prerequisite for enterprise growth is public goods, such as roads and infrastructure.

In summary, based on the constraints and bottlenecks listed by the gum producers, the basic assets needed by gum producers can be divided into three categories:

x Natural assets (trees, drinking water) x Human assets (capacity building, skills) x Financial assets (infrastructure, favourable prices, credit)

The assets can be owned by individual actors, communities or entire societies, depending on the type. For example, a natural asset such as trees may be owned by the state and/or a rural community. The assets can be seen as stocks or flows. Financial assets, for example, constitute a stock when held as credit for Gum Arabic activities or a flow when used for establishing gum trees (a natural asset).


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Flows across the different types of assets are important as they can lead to positive feedback loops (the building of one asset leads to the building of another), but flows can also lead to asset erosion (the loss of one asset induces the loss of others). An example of a positive feedback loop would be the building of human assets through training the rural gum producers in gum drying, cleaning and sorting to help increase the value of their product and raise their incomes. A negative feedback loop could be caused by low regeneration capacity of gum trees and a lack of drinking water (loss of natural assets) that erodes income generation (a financial asset). Another example of a feedback loop is the acquisition of market information by rural gum producers (a human asset), which helps obtain higher prices and incomes (financial assets).


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5. Conclusions and recommendations

5.1 Conclusions

Gum Arabic is a high value commodity in East Darfur with great economic importance in rural areas. It generates incomes for a number of actors engaged in producing, cleaning and trading the product.

Analysis of the network of actors (producers, village traders, urban traders and agents) and of the distribution of profits highlights the socially-embedded nature of the value chain and the complex links between the various processes taking place at the rural level. The empirical results of this investigation show that downstream actors (traders and companies) are the main beneficiaries from commercial trade in Gum Arabic from East Darfur. These actors deal with larger quantities and earn higher incomes. The analysis of the value chain for Gum Arabic indicates that resource property rights are not the only mechanism for accessing profits from trade in this product.

Despite the legitimate right of the producers to benefit from gum production and trade, their access to profits is weak. Producers receive fewer benefits than other actors in spite of their immense work and dominant role in the value chain of the product. Gum production and trade is much more profitable for agents and processing companies. However, while increasing the price of gum at the producer level may be beneficial to producers, the traders, agents and companies bear relatively higher levels of risk due to their larger capital investments in a context of fluctuating market prices.

The study found that producers lack training on gum post-handling activities and lack access to drinking water, market information and financial credit. They also lack organization, so do not have the ability to negotiate, as a group, with buyers, and cooperate in terms of, for example, prices, and do not undertake group activities such as sharing the costs of transporting their product to distant markets.

If producers were able to get access to credit for their initial investment in gum production, they would have more control over the prices they receive for their product and their profits would increase tremendously. In addition, value added processing at the local level has high potential to increase the profits of the producers. Primary processing requires training on processing and gum standardization measures, processing and preservation equipment, and access to credit.

Economic opportunities for upstream actors do not necessarily translate into incentives to train producers on how to tap and manage their trees sustainably. However, securing higher profits could motivate actors to think about sustainable management of natural resources. This would also help to ensure steady supply of the product and maintain the competitiveness of the sector.


34

5.2. Recommendations

The recommendations presented here are those that are considered to potentially have the highest impact on the development of the Gum Arabic value chain during the "UN Environment Project" (Natural Resource Management for Sustainable Livelihoods) in East Darfur.

A necessary step in developing the Gum Arabic value chain is to ensure the producers have access to the basic assets they need and that producers are empowered. Furthermore, the key natural resource, the gum producing trees, should be managed sustainably. The recommended interventions for each particular constraint are presented in Table 11, along with the goals of each intervention, the relevant stakeholders to be involved and the roles of each. Table 11: Recommended interventions in response to particular constraints and bottlenecks

Constraint/ bottleneck

Recommended

intervention Goal

Relevant

stakeholders Roles

Lack of drinking water

Establish drinking water points.

Drinking water is available to gum producers.

State government

Financial and technical support; undertake groundwater surveys and establish groundwater maps; conserve water resources.

Tribal leaders

Support water resource conservation; conflict resolution; coordination between water users.

NRM Project Provide technical and financial support.

Lack of training on gum drying, cleaning, and sorting

Build the capacity of gum producers.

Gum producers have skills in gum processing.

FNC Provide training on gum drying, cleaning and sorting.

Tribal leaders Support the application of the skills in the field.

NRM Project Provide financial support for training workshops.

Lack of market information

Develop market

Formal markets are

Gum producers' associations

Make chain relationships more stable; improve access to information.


35

Constraint/ bottleneck

Recommended

intervention Goal

Relevant

stakeholders Roles

information systems.

in operation. Government

Improve access to information via media, mobile SMS, etc.

Lack of financial credit

Provide rural gum producers with long-term credit

Long-term credit is available to producers.

Banks, development organizations, state government

Offer long-term financial credit.

Low regeneration capacity of Hashab trees

Support rural communities to establish community-based Hashab stands

Gum is harvested from Hashab stands.

Community members

Produce seedlings; transplant seedlings; follow up related activities in the field.

Tribal leaders

Secure land ownership; land conflict resolution; coordinate communities and other actors.

FNC Provide suitable extension services; training; tree seeds.

World Food Programme

Provide food for work in the nursery and the field.

NRM Project Provide financial support for establishing nurseries and tools.

Successful implementation of these interventions for developing the Gum Talha value chain in East Darfur requires the collaboration of all related stakeholders, including NGOs, the state government, tribal leaders, the FNC, and United Nations organizations (UN Environment, WFP, etc.). The participation by all stakeholders will ensure all roles are undertaken, and the interventions will be accepted and successfully implemented. Moreover, active participation and commitment from the relevant stakeholders in the interventions will enable the gum actors themselves to understand and own the Gum Talha value chain development process and initiatives to establish forest stands after the phase-out of the "Natural Resource Management for Sustainable Livelihoods" project in East Darfur.


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