Achieving more Sustainability in Global Agricultural Supply Chains

Project description

Title: Sustainability and Value Added in Agricultural Supply Chains
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Global (Brazil, Burkina Faso, Colombia, Cameroon, Ecuador, Ethiopia, India, Indonesia, Uzbekistan)
Lead executive agency: Relevant ministries in the project countries (Ministry of Agriculture, Ministry of Textiles, Ministry of Environment, Ministry of Industry)
Overall term: 2019 to 2026

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Context

More and more people value products produced in a fair and sustainable manner. Yet many widely available agricultural products have a bad record in this regard – palm oil, for example. It is found in many products, from food to cosmetics. It is produced in tropical regions and travels all round the world before reaching consumers in Germany. On top of that, valuable tropical forest is often destroyed for oil palm plantations, and the intensive agricultural practices degrade soil quality. In addition, smallholder producers and workers along the supply chains often work in inhumane conditions. 

Agricultural commodities are produced by millions of smallholders around the world. They are faced with international companies which use their market power to determine the production conditions along the supply chains and which rake in a large part of the profits. The income of smallholder producers, however, is generally not enough to make a living. 

Agricultural commodities are primarily sold by smallholders in unprocessed form. However, added value and income are primarily generated in the downstream production steps. Smallholders are therefore heavily dependent on strongly fluctuating agricultural commodity prices over which they have no control. The working conditions are precarious as well. Even though improvements have been made, slavery and child labour are frequent problems in the industry. 

Objective

Sustainability is improved in selected agriculture supply chains. 

Approach

The project helps improve the sustainability of popular agricultural products. It focuses on bananas, cotton, coffee, cocoa, natural rubber, palm oil and soy. To this end, it works with players along the entire supply chains, from international companies to smallholders.

At a global level, we work across countries and stakeholders to combat transboundary challenges.

The underlying approach is 'from SHELF to FIELD'. Companies dominate the market and have the greatest influence on the supply chains. The project therefore cooperates with international companies which want to mainstream sustainability in their supply chain. The collaboration is intended to provide product traceability from the shelf to the field. This tells consumers whether a product actually meets minimum social and environmental standards. The goal is to achieve sustainability, starting from the consumer.

The project organises training courses for farmers on good agricultural practices (GAP) and organisational development aspects. Smallholders receive assistance to convert their production to satisfy international standards such as the Roundtable on Sustainable Palm Oil (RSPO), the Better Cotton Initiative (BCI) or Fairtrade. In order to ensure the industry's future, particular attention is paid to promoting women and involving young adults in the agricultural sector.

Producers can increase and diversify their income if more value creation took place locally. Centres for founding and supporting start-ups are therefore being established to promote local investment in textile processing. Building local value creation means also implementing measures to increase the quality of agricultural commodities, for example by linking producers with speciality markets. 

To make the best use of global synergies, the global project promotes international knowledge transfer of good practices and good governance in sustainable agriculture supply chains. For example, the project uses its examples of successful project implementations in international dialogue formats such as the German Forum for Sustainable Palm Oil (FONAP). 

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Last update: February 2021

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