Input Bundling: A BUSINESS-LED STRATEGY

TO IMPROVE SOYBEANYIELDS

Feed the Future Soybean Innovation Lab Webinar | July 25, 2019

Photo: K. Ragsdale / MSU

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Meet the Panelists

Dr. Peter Goldsmith is the

Director of the Feed the Future

Soybean Innovation Lab Gender

Impacts team and a professor of

Agribusiness Management at the

University of Illinois at Urbana-

Champaign.

Mr. Abdul-Rahman Tawfic is an

Agricultural Engineer and the CEO of

Big Ajar Enterprise, a nucleus farm

with experience bundling inputs for

outgrowers located in the Upper

West Region of Ghana.

Edward Baars is the N2Africa

Senior Business Development Officer

with the International Institute of

Tropical Agriculture based in Abuja,

Nigeria.

Duncan Sones is a consultant

working in partnership with UK-

based CAB International on

communications initiatives to

promote best agricultural practices

throughout Sub-Saharan Africa.

Duncan is a champion for input

bundling.

The Economics of Input

Bundling for Soybean

ProductionPeter Goldsmith

Principal Investigator, SIL

Soybean as a “ Long Jump Technology”( Tamimie et al, 2019)

• Technology adoption has a rich body of literature

• But what about “Long Jump” technologies??

• Those that require significant changes by small holders

• Tillage, commercial inputs, seed suppliers, soil correction,

planting practice, gender equity implications….

Sequential Technology Adoption(Byerlee, 1986; Aune and Bationa, 2008)

• High fixed cost barriers

• Technical complexity

• a commercial crop

• Lack of “facile input divisibility”

• a system crop

SIL SMART Farm Omission TrialsAwuni et al, 2019

1. White Bundle1. Traditional Farmer Baseline

2. Yield = 637 kg/ha

3. Saved seed, minimal inputs

2. Red Bundle1. Ridge planting, certified seed, high seed population (300k/ha), narrow rows

and seed spacing (75:5)

3. Yellow bundle1. Red Bundle + Inoculum

4. Blue Bundle1. Yellow Bundle+ Phosphorus

5. Green Bundle1. Blue Bundle + Lime

SIL SMART Farm Results 2014 – 2017 Data

Yield

Cost

per Ha

Marginal

Cost

Marginal

Revenue Revenue

Bundle Practices Kg/Ha $USD* $USD $USD Cost

White Traditional 637 295$ -$ -$

Red Improved** 1,372 375$ 79$ 349$ 4.40

YellowRed plus

inoculuum1,754 388$ 93$ 530$ 5.71

BlueYellow plus

phosphorus2,146 455$ 159$ 716$ 4.49

GreenBlue plus

lime2,200 495$ 200$ 741$ 3.70

Note *: exchange rate GHȻ:$USD = 4.3 (2016)

Note**: certified seed, good seed bed, ridge planting, 300,000 seeds per ha, narrow rows, early planting date, 3 hand weedings, no mechanization

SIL SMART Farm Results

2014-2017* data

What should the marketing campaign look like?

Bundling: Next Steps

• Agronomic Research• Replicate SMART Farm Omission Trials in Ethiopia, Malawi and Zambia

• Explore cost-benefit of herbicide treatments

• Extension Research• How might input dealers better adopt bundling?

• Training on industry practices

• Scale the understanding and application of input bundling in the private sector

• Would love to collaborate• Issues of credit and risk management are critical to input adoption by small holders

Step-wise incremental input bundles

cost-benefit ($/acre)

0

50

100

150

200

250

300

Baseline Red Yellow Blue

Cost Return

A ‘demonstration’ try-out

Soybean, no inputs

Soybean, + P+ inoculation

Soybean, + inoculation

Soybean, + P

20 m

20 m

control +Pfert +ino +Pfert+ino

Cumulative probability of returns:

use of inoculants makes P-fertilizer economic

Giller, Andersson, Corbeels, Kirkegaard, Mortensen, Erenstein, Vanlauwe (2015). Frontiers in Plant Science .

Step-wise input bundles are farmer-centric choice options, if inputs are available…

Tailoring technologies

Ghana: Next season anticipated source of

certified soybean seeds (n=1,723)

0 100 200 300 400 500 600

Anidaso

Salintuya 1 & 2

Afayak

No name

Jenguma

Not available Commercial source

For 88% seeds are not available

Ghana: Soybean farmers’ awareness

of inoculants per region (n=1,818)Next season anticipated source of

inoculants (n=786)

128

176

543

263

246

462

0 200 400 600 800 1000

Upper East

Upper West

Northern

Inoculants aware Inoculants unaware

3

4

20

113

646

0 100 200 300 400 500 600 700

Contract growing

CBO

Local market

Agrodealer

Not available

47% awareness of inoculants If aware, for 82% inoculants are not available

ICT-Based models for improved supply chain management systems

to make input demand predictable and supply cost-effective

A member of CGIAR consortium

ICT-Platform M-omulimisa in Uganda Being populated with Partner farmers’ mobile

numbers

E-Extension

Lessons Learnt

Soybean - ‘step-wise-incremental bundles’ can provide solutions for low productivity to all farmers – rich and poor, gender and age groups

Integration of scientific disciplines (biophysical, socioeconomic, etc) helps to unravel the constraints and understand how best to intervene

Demand led research leads to uptake of technologies

Demand prediction is key for the continuous supply of technologies

Business-led Input Scheme in Partnerships

Abdul-Rahaman Taufic

Agric. Engineer: Post-harvest Option

Big Ajar Enterprise, Upper West region of Ghana

Big Ajar Enterprise History and Functions

1. BAE is 100% owned by Mr. Taufic and registered in 2005

2. BAE establish an outgrower scheme in 2008 in Wa East but developed overtime

with support from development partners.

3. Currently have 493 soybean farmers (males=441 and females=52) operating in

Upper West Region of Ghana.

4. There are 400 grain producers collectively farming 800 ha and certified seed

producers are 20 (150 acres).

5. BAE have warehouse (500 MT capacity), 3 tractors, 3 multi-crop shellers, field

monitors, and lead farmers.

Input Bundle and Services Provided

1. Input bundle provided per acre

1. 15 kg of certified soybean seed (Jenguma and Afayak)

2. 1 bag of YARA fertilizer

3. 200 grams of inoculum

4. 1 litre of glyphosate

5. 1 litre of post emergence herbicide

2. Services Provided

2.1 Tractor ploughing services (optional)

2.2 Soybean technical assistance

3. Inputs are supplied on credit before the farming season and farmers pay back with 3 bags of

soybean after harvest.

4. Contract is written but field staff monitor the activities of farmers before, during and after

harvest.

5. Input bundle is same for all farmers (2 acres) but tractor service is based on needs assessment.

1. Buy soybean from farmers after repayment of input credit.

2. Sell soybean grains to processing, poultry industries, and open markets in Kumasi

and Accra.

3. Sells certified seeds to the local market, other nucleus farms, government

institutions (eg. MoFA SADA, NGO), TUTURIDEP in Tumu, and input

distributors.

4. Side-selling is common when spot market prices are higher than the contract

price.

5. Next steps

5.1 Plan to get tractor/mounted planters

5.2 Acquire more tarpaulins to outgrowers

5.3 Get additional tractors to replace depreciated old tractors

Soybean Marketing, Constraints and Next Steps

Reactor Panel

Simon BijibaProject Supervisor

I-SEARCH Project

Catholic Development Office

Yendi, Ghana

Carl Jensen CEO

Good Nature Agro

Chipata, Zambia

What would it take:

Policy change – enabling environment

• To embrace the idea of stepwise recommendations in

extension messages

• To encourage a research agenda that builds the data for all

crops (not just soybean) that drive the information

development

• Consider a stepwise as a viable alternative to traditional

subsidy schemes – potentially though Anchor Schemes or

input supply sector

• Allocation of role of developing clear information for use

by farmers and intermediaries

• Get customised stepwise information out to extension,

credit providers, input providers and off-takers all

understanding how the approach works and how it can

work for them

• Produce information campaigns that help farmers

understand the process of bundling

Information brokerage:

Making sure everyone understands

Supply chain brokerage

Ensure that the inputs required for the bundle can be bought in one

location.

This may mean:

• Credit brokers diversifying into inputs,

• Getting agro-dealers able to sell crop insurance,

• Setting up networks of village-based agents that sell at the farm gate,

• Incorporating bundling into the Anchor Farms.

This may require investment in capacity building for public and private

sectors.

Q&A

Dr. Peter Goldsmith Director

Soybean Innovation Lab

Edward Baars Senior Business Development Officer

N2Africa

Abdul-Rahman TawficCEO

Big Ajar Enterprise

Carl Jensen CEO

Good Nature Agro

Simon BijibaProject Supervisor

I-SEARCH Project

Duncan Sones Consultant

CAB International

Input Bundling

A BUSINESS-LED STRATEGY

TO IMPROVE SOYBEANYIELDS

Photo: K. Ragsdale / MSU

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Photo: K. Ragsdale / MSU

Feed the Future Soybean Innovation Lab Webinar | July25, 2019

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