We study changes in the last decade in the teff value chain, Ethiopia's most important staple food crop by area and value. Upstream, there is increasing adoption of modern inputs and new varieties -especially by those farmers living close to cities -leading to higher land productivity. Mid-and downstream, we find improved processing costs and increasing willingness-to-pay for convenience and quality, as illustrated by the emergence of one-stop retail shops and the rise of more expensive teff varieties. Because of the large numbers of teff producers and consumers, this transformation has important implications on the country's food security.
Certification of Voluntary Sustainability Standards (VSS) is rapidly increasing in global value chains. While consumers, mostly in developed countries, are willing to pay significant premiums for the certification of such standards, it is not well understood how effectively these incentives are transmitted to producing countries. We study VSSmore in particular Fair Trade and Organic certification-in Ethiopia's coffee sector, the country's most important export commodity, using a unique census of transaction data at the export level and large-scale data at the production level. We find that transmission of export quality premiums to coffee producers is limited, with only less than one-third of this premium being passed on, and we find limited evidence of effects due to communal investments. Moreover, as quality premiums are small and average production levels in these settings are low, we estimate that these premiums would only lead to an increased income for coffee farmers of 22 USD per year even with a perfect transmission scenario, and therefore would have little impact on the welfare of the average coffee farmer. Given that the VSS studied are characterized by the highest premiums among VSS schemes, it can be assumed that even lower benefits from other VSS certification schemes trickle down to producers.
Urbanization is quickly increasing in Africa, raising important questions on how food value chains to cities function and what the implications of urban growth are for the local food trade and farm sector. We study the rural-urban value chain of teff in Ethiopia, by value its most important staple value chain. Relying on unique large-scale surveys at different levels in this value chain, we findin contrast to conventional wisdom-that value chains are relatively short and that average farmers obtain a high share, of about 80 percent, of the final consumer price in the major terminal market, Addis Ababa. We further find that producer prices decline in line with transportation costs the further farmers live from the city, that seasonal price movements are rather small, and that average stock release by farmers is smooth over the year.
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