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  • Smart use of trees: Co-investment scheme improves livelihoods, maintains ecosystem services

Smart use of trees: Co-investment scheme improves livelihoods, maintains ecosystem services

A woman inspects buds on a tree as part of the Climate-smart, Tree-based, Co-investment in Adaptation and Mitigation in Asia project. Photo by ICRAF
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A woman inspects buds on a tree as part of the Smart Tree-Invest project in Indonesia. Photo by ICRAF

The World Agroforestry Centre (ICRAF) recently marked the end of its Climate-smart, Tree-based Co-investment in Adaptation and Mitigation in Asia (Smart Tree-Invest) project with a closing event in Jakarta. 

Smart Tree-Invest, supported by the CGIAR Research Program on Forests, Trees and Agroforestry (FTA) and the International Fund for Agricultural Development (IFAD), worked in watersheds in Buol, Central Sulawesi, Indonesia; Lantapan municipality, Bukidnon province, the Philippines; as well as Ha Thinh and Quang Binh provinces in Vietnam.

The project, which ran from 2014 to 2017, aimed to improve the livelihoods and resilience of smallholder farmers through the promotion of climate-smart, tree-based agriculture in the three countries, aimed at reducing their vulnerability to climate change.

It did so by developing co-investment models that involve smallholders as ecosystem service providers while local governments and the private sector invest as ecosystem service beneficiaries.

Based on diagnostic studies of needs and opportunities in each country, the project introduced novel tree-planting schemes to improve the quality of home gardens, smallholders’ plantations, riparian and sloping land — and ultimately the quality of the environment and local livelihoods.

The process of identifying opportunities as well as new schemes for using resources available locally have been adopted by local governments in the three countries, overcoming their initial skepticism based on past ‘project’ experience. Moreover, toward the end of the project, private sectors were eager to join in initially monitoring ecosystem services in their sites in Indonesia, supporting market access for smallholders in Vietnam, and starting the initial incentive flow in the Philippines.

FTA researcher Beria Leimona speaks at the Smart Tree-Invest project’s closing event. Photo by Sidiq Pambudi/ICRAF

Smart Tree-Invest was the first project to explicitly pilot the development of Co-investment in Ecosystem Services (CIS) schemes, a concept that emerged from earlier Payment for Ecosystem Services (PES) ideas. More than 600 farmers from the three countries were involved in co-investment activities.

Watch: An introduction to the Smart Tree-Invest project

FTA researcher and ICRAF ecosystem services specialist Beria Leimona, who was the overall leader of Smart Tree-Invest, noted the similarities between the three countries.

“We chose these sites because we work closely with the International Fund for Agricultural Development or IFAD [which had established a presence in the areas through previous projects] and all of the sites are remote, and they are more or less the ‘poorest of the poor’,” she said.

The Lantapan watershed had previously hosted an investment in environmental services project. There was also investor interest in the areas in terms of the private sector, including a major hydropower company in the downstream. It was the first time co-investment had been implemented on the ground.

The area “had been degraded to some extent,” Leimona said. ICRAF has had a presence in Lantapan for quite some time, she explained, beginning with the Landcare initiative in the 1990s.

“With Landcare, we saw the potential: we gave the awareness [about tree planting], but what sort of incentives would make them want to sustain the pilot?”

Following that was the Rewarding Upland Poor for Environmental Services (RUPES) project with its incentive system for farmers.

Researchers subsequently “added information about what type of ecosystem services farmers and outside beneficiaries could get if they planted trees on their farms, which was in this case the watershed functions — increasing water quality for the company and also reducing erosion from farmland.”

“Through Smart Tree-Invest, we wanted to get more stakeholders involved in linking development programs with well-measured conservation objectives to result in green-growth scheme in their jurisdictions, including IFAD as the development agency and particularly the district and provincial government,” Leimona said.

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A farmer shows off cacao pods growing on a tree as part of the project. Photo by ICRAF

Buol in Indonesia and Ha Tinh in Vietnam were more remote than the Philippines site. There was “almost no private sector,” Leimona said, adding that there was also less interest from business and infrastructure was less supportive.

She put this down to the area not being “sexy” or high-profile like locations such as Kalimantan, leading to almost no projects occurring there.

The silver lining was that “the enthusiasm of the local government was very high because they were quite eager to see what happened.”

Among the other notable differences between the sites were that in terms of the landscape structure, Vietnam did not have a mixed system or agroforestry. That stemmed from land-use policy, said Leimona, whereby farmers must follow government requirements on what to plant on their land.

In Buol, agroforestry existed with crops such as cacao, coconut and candlenut, Leimona explained. However, it had not been commercialized and was not well managed. “People didn’t think it could be a source of future profits,” she said, adding that farmers previously concentrated more on their patchouli or paddy fields.

Among other approaches, the project used the Capacity Strengthening Approach to Vulnerability Assessment (CaSAVA) framework, which ICRAF developed. The participatory approach of CaSAVA helped the collection of local ecological knowledge from smallholders in Lantapan, according to researcher Kharmina Anit in the Philippines, and increased their awareness of the issues in their landscapes, encouraging practical adaptation solutions at the community level.

The project also provided best practices in support of the implementation of policies in each country.

In Buol, the local administration has committed to replicating Smart Tree-Invest activities including farmers’ learning groups and watershed and tree-planting monitoring. The project was implemented in two subdistricts in the Buol watershed, and the district administration is set to expand activities to the Mulat-Lantika Digo watershed, using its own funding.

FTA scientist Meine van Noordwijk (left) poses for a photograph with members of the Smart Tree-Invest Vietnam team. Photo by Sidiq Pambudi/ICRAF

The administration has requested ICRAF’s support through continued technical assistance as it replicates the project activities after the project’s end.

Watch: Impacts of Smart-Tree Invest project after 3 years

In summing up the project’s impacts and its relation to greater goals at the closing event in Jakarta, FTA scientist Meine van Noordwijk said it was “not only about healthy food but also healthy farmers and healthy forests […] in the frame of climate change.”

Unlike management systems that require results to be outlined beforehand and achieved, Van Noordwijk added, Smart Tree-Invest made a commitment and then awaited the impacts. The “open-ended” learning approach fit into existing structures of regulations and funding mechanisms, as well as working within local contexts.

“[This] provided food for thought on how we may see one object from different perspectives, and end up with different results,” said ICRAF ecosystem services specialist Sacha Amaruzaman. “Professor van Noordwijk reflected on the different characteristics of three country sites; how the similar start in each site through the application of the CaSAVA framework ended up with different co-investment schemes.”

“Clarification of the issues, weighting the trade-off between options and considering context are the three actions required to achieve development goals,” he added.

The partnerships formed with governments and other stakeholders stand as testament to this, as does the continued commitment in the sustainability of the project.

By Hannah Maddison-Harris, FTA Communications and Editorial Coordinator. 

This work forms part of the CGIAR Research Program on Forests, Trees and Agroforestry (FTA). We would like to thank all donors who supported this work through their contributions to the CGIAR Fund. This project was  supported by the International Fund for Agricultural Development (IFAD).

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  • Smallholder farmers in REDD+ sites: The cost of missed opportunities

Smallholder farmers in REDD+ sites: The cost of missed opportunities

A man from Pangkalan Limus village collects wood from the surrounding forest in West Java, Indonesia. Photo by A. Erlangga/CIFOR
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A man from Pangkalan Limus village collects wood from the surrounding forest in West Java, Indonesia. Photo by A. Erlangga/CIFOR

Paying farmers not to clear forests could be more effective – if we had a better idea of how much income they really lose.

It is clear that REDD+ has changed from what was first envisaged. First formulated in 2005 as part of the United Nations Framework Convention on Climate Change, the approach attracted high hopes for slowing down climate change by reducing emissions from deforestation and degradation. An integral part of the approach that was originally conceived included direct payments to forest users for not deforesting or degrading forests.

This has not turned out to have been as central to REDD+ implementation as initially expected. There is still, however, broad consensus that the global beneficiaries of climate change mitigation should provide benefits greater than the burdens faced by local forest users who are asked to conserve forest.

A new paper by CGIAR Research Program for Forests, Trees and Agroforestry (FTA) scientist Dr. Amy Ickowitz of the Center for International Forestry Research (CIFOR) and colleagues Erin Sills and Claudio de Sassi shows just how much smallholder farmers in a variety of REDD+ sites would actually lose if they were to stop all deforesting and degrading activities, and were not compensated. The paper also outlines how these costs vary between the richest and poorest farmers.


Using data from CIFOR’s Global Comparative Study on REDD+ (GCS REDD+), taken from a number of sites across six tropical countries, the new paper shows that initial estimates of how much smallholder farmers should be compensated for their losses from foregoing deforesting and degrading activities were underestimated.

That led to a mindset in which policymakers and donors thought they could reduce emissions “very cheaply,” according to Ickowitz.

In some cases, this is true. But in many others, it is not. This mindset does not adequately take into account the fact that costs vary widely, even within the same community.

The study separated costs by income group to show how the opportunity costs of deforestation and degradation differ between the richest and poorest members of the communities. As it turns out, these differences can be very large indeed.

Making payments based on more accurate opportunity cost estimates would make REDD+ programs more equitable and likely more effective, says Ickowitz.

She adds that the research shows how a system of flat payments — per hectare, or per household — could be a “pro-poor” approach, as lower-income households have lower average opportunity costs compared to richer farmers in all study sites considered across all six countries.


So what exactly is an ‘opportunity cost’?

Simply put, it is the income a forest-user loses after complying with REDD+ restrictions on his or her land. If a farmer used to clear trees and grow crops on that land, the opportunity cost is the value of the production he or she has had to give up.

Based on household data and estimates of carbon stocks from six tropical countries, Ickowitz and her team found that opportunity costs per ton of carbon for most of the smallholders in the study exceed current market prices on the voluntary carbon market.

In the early days of REDD+ thinking, estimates of smallholder opportunity cost were much lower than they turned out to be. At the same time, carbon market prices did not rise to the level that many had anticipated.

“One of our main findings is that despite many concerns that REDD+ would mostly hurt poor farmers, if payments were made to farmers based on average community opportunity costs, they would most benefit the poorer farmers in our sample,” says Ickowitz.

But even if carbon prices were to rise to a level that would be able to fully cover average opportunity costs of forest users, there would still be distributional considerations.

A flat payment system could increase transparency, reduce transactions costs, and benefit the lowest income households. But under this type of system, forest-users with higher incomes would not be fully compensated unless payments were set at higher-than-average costs – thus they would either opt out, or lose out from participating in REDD+.

If compensation costs were set at higher-than-average rates to attract the higher income households, costs would substantially increase.

A smallholders farm is seen in Acre, Brazil. Photo by K. Evans/CIFOR


On the other hand, the opportunity costs to smallholders in all but one of the sites sampled were less than the social cost of carbon as estimated by an Interagency Working Group of the US federal government.

Therefore, reducing deforestation by smallholders and consequent carbon emissions “would generate net global benefits,” Ickowitz and her colleagues conclude.

But the research also makes clear just how serious an economic loss REDD+ restrictions can impose on small farmers if they are not compensated adequately.

“This, to me, is the real significance of having real numbers from real people across many different places,” says Ickowitz.

And because it is so hard to conduct detailed household surveys at all locations where REDD+ will be implemented, the wide range of sites sampled across the tropics increases the value of the data.

While REDD+ may have evolved into a different type of mechanism than originally conceived, ultimately, it is still about getting forest users to change their behavior.

The research brings us back to looking at what is required to compensate smallholder forest users fairly if they are asked to change their activities. Without equitable compensation, forest-users are not likely to cooperate. This means getting compensation right may well be one of the many issues REDD+ needs to overcome to fulfill its objectives at meaningful scale.

By Andrew North, originally published at CIFOR’s Forests News

For more information on this topic, please contact Amy Ickowitz at a.ickowitz@cgiar.org.

This research forms part of the CGIAR Research Program on Forests, Trees and Agroforestry. We would like to thank all donors who support this work through their contributions to the CGIAR Fund.

This research was supported by Norwegian Agency for Development Cooperation (Norad), the Australian Department of Foreign Affairs and Trade (DFAT), the European Commission (EC), the International Climate Initiative (IKI) of the German Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety (BMUB), the United Kingdom Department for International Development (UKAID). 

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  • Estimating smallholder opportunity costs of REDD+: A pantropical analysis from households to carbon and back

Estimating smallholder opportunity costs of REDD+: A pantropical analysis from households to carbon and back

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Compensating forest users for the opportunity costs of foregoing deforestation and degradation was one of the original distinguishing features of REDD+ (Reducing Emissions from Deforestation and Degradation). In the early days of REDD+, such costs for tropical smallholders were believed to be quite low, but this has increasingly been questioned.

A decade after the concept was proposed, direct payments to forest stakeholders remain rare, while concerns about safeguarding livelihoods are increasing. Households facing restrictions on forest-based activities will have to be compensated, yet evidence on actual costs to households, their distribution, and implications for efficiency and equity is limited.

We estimate smallholder opportunity costs of REDD+ in 17 sites in six countries across the tropics. We use household data collected from multiple sites in multiple countries using a uniform methodology. We find that opportunity costs per tCO2 emissions from deforestation are less than the social costs of tCO2 emissions ($36) in 16 of the 17 sites; in only six of the sites, however, are opportunity costs lower than the 2015 voluntary market price for tCO2 ($3.30).

While opportunity costs per tCO2 are of interest from an efficiency perspective, it is opportunity costs per household that are relevant for safeguarding local peoples’ income. We calculate opportunity costs per household and examine how these costs differ for households of different income groups within each site. We find that poorer households face lower opportunity costs from deforestation and forest degradation in all sites.

In a system of direct conditional payments with no transactions costs to households, poorer households would earn the highest rents from a system of flat payments. Our findings highlight that heterogeneity and asymmetrical distribution of opportunity costs within and between communities bear important consequences on both equity and efficiency of REDD+ initiatives.

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  • 'Turning the onus of restoration into a bonus for farmers' in Brazil

‘Turning the onus of restoration into a bonus for farmers’ in Brazil

David Kenduywo is pictured at his farm in Kembu, Kenya, where he grows fodder trees, shrubs and grass for his dairy cattle. Photo by Sherry Odeyo/ICRAF
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David Kenduywo is pictured at his farm in Kembu, Kenya, where he grows fodder trees, shrubs and grass for his dairy cattle. Photo by Sherry Odeyo/ICRAF

A recent article on research in Brazil yields seven flexible options for farmers who wish to use agroforestry as a means to comply with regulations while benefitting their land and livelihoods.

Setting aside conservation areas on Brazil’s farms and rural properties isn’t just good for the ecosystem, the climate and biodiversity – it’s the law. In 2012, the country passed a new Brazilian Forest Code known as the Law for Protecting the Native Vegetation.

This code expands on an older law that obliges all farmers and rural property owners to set aside a portion of their land, known as Permanent Preservation Areas and Legal Reserves, for conservation.

Mandating the restoration of a portion of a farmer’s land with a mix of native species carries potential negative short-term economic impacts despite the collective environmental services. Obligatory conservation and/or restoration using conventional methods consisting of planting native trees can reduce the immediate economic potential of the land, which could otherwise be used to farm commercial crops. But this is not necessarily the case.

For the many smallholders, or ‘family farmers’ in Brazil, incorporating agroforestry systems (AFS) is a legally acceptable land use which satisfies the definition of a conservation area. However, regulation is still fledgling and consistency in its application has been erratic.

So what is the best way to incorporate AFS into farm land and rural areas while maximizing species diversity, ecosystem benefits, and ultimately, livelihood benefits?

A farmer walks through an area where intercropping of rubber and food crops takes place. Photo by Julius Atia/ICRAF

The answer is complex due to inconsistencies in regulation, and substantial differences among farmers’ means and goals, access to markets and biophysical conditions, crop choices, and scant access to knowledge on landowners’ restoration options. To help alleviate these knowledge and practical gaps and to strengthen enabling factors like policy and regulation, a body of research was conducted in the Cerrado and Caatinga biomes to analyze the best AFS options.

Through a literature review, interviews with stakeholders, a national workshop and a series of on-site farmer experiences and observations, the research team led by the World Agroforestry Centre (ICRAF) and partners, including FTA researchers, set out to determine if and how AFS was indeed a viable option for smallholders to both fulfill their legal obligations to conserve and/or restore land and maximize livelihoods and other benefits.

Read the full open source article on Cambridge University Press.

Based on the research, and accounting for biome or landscape context and farmer experiences, seven broad options were identified for farmers and rural landowners as flexible solutions that are adaptive enough to fit most circumstances and cater to individual needs and capabilities. While uptake of these techniques by farmers is a key component, an equally significant result is that state regulators and extension agents, armed with an understanding of these options, are better able to oversee implementation of the new Forest Code and therefore generate consistent services and policy.

The options are:

  • high-input successional agroforestry systems for the Cerrado: planting in beds with annual crops and vegetables with rows of fertilizer trees and agroforestry species;
  • planting alternate strips of agroforestry and native species;
  • planting ‘fertilizer’ and ‘engineer’ species in rows or ‘islands’ (clusters) throughout the area;
  • planting seeds and seedlings for enrichment and managing natural regeneration;
  • agroforestry for restoring steep hillsides in terraces or swales in the Cerrado or soft slopes in the Caatinga;
  • forage agroforestry systems in the Caatinga; and
  • restoring degraded lands in the Caatinga beginning with “engineer” and “fertilizer” species.

This study concludes that AFS is a viable option for smallholder farmers to reconcile with the Forest Code’s goal of increasing conservation while improving the land, and reaping economic and environmental benefits. As notably stated in the article, [AFS] “can indeed provide practical solutions for turning the onus of restoration into a bonus for farmers.”

Originally published on the IUCN website.

This study is part of a partnership between IUCN and ICRAF funded by ‘Improving the way knowledge on forests is understood and used internationally (KNOWFOR)’ under a grant awarded to IUCN by UK Aid from the UK government. In Brazil, this project is coordinated by ICRAF in partnership with IUCN, Embrapa (Brazilian Agricultural Research Corporation), ISPN (Institute for Society Population and Nature), SFB (Brazilian Forest Service), ISSA (Instituto Salvia) and Mutirão Agroflorestal. 

The research forms part of the CGIAR Research Program on Forests, Trees and Agroforestry (FTA), supported by CGIAR Fund Donors.

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  • Stepping up to the challenge to end poverty and hunger without trashing the planet

Stepping up to the challenge to end poverty and hunger without trashing the planet

Cocoa is one of the tree crops this research focuses on. Photo: Neil Palmer/CIAT
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Agroforestry activity, West Kalimantan – Indonesia, 2009. Photo: Ryan Woo/CIFOR

By Fergus Sinclair, Leader Agroforestry Systems, World Agroforestry Centre and Coordinator Flagship 2

The livelihood systems flagship of FTA has set out a bold research agenda from 2017 to 2022 to enhance how trees and forests contribute to smallholder livelihoods, particularly by improving food and nutrition security and increasing household income in the face of global change.

Not everyone agrees that trees can make a difference, and much of the agricultural establishment still sees an antipathy between farming and forestry, but we have more and more evidence that, if managed appropriately, trees can sustain and increase agricultural productivity for many smallholders in developing countries, and address the simultaneous need for food, energy and water in a sustainable way.

It is time to change outdated perspectives: trees and forests should take their rightful place in meeting the United Nations Sustainable Development Goals.

A Systems Approach

In a recent independent evaluation of the Trees for food security project funded by ACIAR (the Australian Centre for International Agricultural Research), farmers in Ethiopia articulated the need for a systems approach to agricultural improvement far more eloquently than researchers have ever done.

Exchanging ideas about agroforestry practices. Photo: ICRAF

They were appreciative of the trees established on their farms through the project, but they pointed out that they also needed better water management to realize the potential of the trees (as well as for domestic use and crop irrigation) and to control livestock grazing, if the trees were not to be eaten in the dry season, when herds of camels moved across their landscape. This points to a key problem with much agricultural research.

Often researchers are focused on one component of a farming system: the trees, the maize or the livestock and assume that, as in industrial agricultural systems of the North, maximizing the yield of one component is the key objective.

This is not what smallholders want. They need to maximize the total factor productivity of their whole livelihood system, and this includes more than just agriculture, they may be involved in processing and marketing their farm produce, utilization of forests, or opportunities to earn off-farm income.

Better management of trees can be central to sustainable intensification of smallholder farms through managing interactions–for example producing fuelwood and fodder on the farm from trees, means that people–usually women–don’t have to spend time collecting them and can devote that time to other productive endeavors.

A Lubuk Beringin villager, Rahimah, 70, harvests palm nut or areca nut on her agroforestry farm at Lubuk Beringin village, Bungo district, Jambi province, Indonesia. Photo: Tri Saputro/CIFOR

But, agroforestry is not yet considered in global assessments of research impact, because the crop production models that drive them can’t accommodate interactions between trees and crops. Our flagship will be changing this in 2017 through a strategic collaboration with the Australian Commonwealth Scientific and Industrial Research Organisation (CSIRO) to develop globally calibrated crop models that incorporate trees.

Flagship 2 is also breaking new ground by using systematic planned comparisons embedded in development initiatives to accelerate development impact. Through key investments from ACIAR, the United Nations International Fund for Agricultural Development (IFAD) and the European Union, and the UK Department for International Development (DFID), thousands of farmers across five countries in Africa will be involved in trying out different options for using trees to improve food and nutritional security, and restore degraded land.

Read also: “Influence flows both ways”: Partnerships are key to research on Livelihood systems

Already this year, the only maize that some farmers in Kenya will harvest is coming from what they planted in trial water harvesting basins, but the power of the planned comparison approach is that it not only delivers locally adapted options today, but also international public goods in terms of understanding how contextual factors condition suitability of options that will enable scaling out.

The food, water, energy nexus

Building on the need for adopting a systems approach, Flagship 2 has a research cluster that focuses on smallholders’ production of timber, food, fuel and non- timber forest products and their marketing.

This connects to research on trees in support of sustainable intensification which looks at how trees impact water cycling on fields and farms and to research under Flagship 4 addressing how trees and forests impact water cycling at landscape and continental scales.

There is a strong focus on value chains that has attracted investment principally from ACIAR and IFAD to develop novel market-based agroforestry options in Uganda, Zambia, Indonesia and Vietnam, and new approaches to managing the forest-farm interface in Burkina Faso and Ghana.

Cocoa is one of the tree crops this research focuses on. Photo: Neil Palmer/CIAT

Tree crop commodities

Some of the most valuable globally traded commodities coffee, cocoa, oil palm and rubber are derived from tree crops, and the majority of production comes from smallholders rather than from large plantations. However, plantations are often the more familiar images that people have in their minds.

Cote d’Ivoire produces around 40% of the global supply of cocoa mainly from smallholder farms, many run by migrant people from drier countries to the north. The cocoa production is now threatened by aging cocoa farms that need rejuvenation (including re-stocking and appropriate fertilization) and by the spread of the virulent cocoa swollen shoot virus disease (CSSVD) that destroys cocoa plants.

Funded by a public private partnership with Mars, we are at the forefront of arresting the spread of CSSVD in Cote d’Ivoire and developing strategies how to rejuvenate and fertilize the crops.

In 2017, this research cluster will also work with Natura on USAID-funded research on oil palm diversification in Brazil and with a range of partners on cocoa and coffee production systems at the forest margin in Peru.

Read also: “Scientists without borders”: ICRAF’s Director General on CGIAR Research Program on Forests, Trees Agroforestry

Trees in support of sustainable intensification

The largest investment in our portfolio goes to research on how trees underpin soil health and can intensify system interactions on smallholder farms to improve farm income and food and nutrition security.

This research builds on research from FTA Phase 1 that established how trees in fields support greater abundances and activity of beneficial soil organisms as well as tighter water and nutrient cycling.

Fertilizer trees have been shown to be a low-cost way to increase crop yields across Africa, but the performance of different options varies greatly with soil, climate, topographical position, altitude, farm system, household endowments, market access, social capital and the prevailing policy and institutional context within which farmers operate.

For the first time, Flagship 2 will measure the performance of tree-intensification and restoration options with thousands of farmers, across thousands of hectares in five countries in sub-Saharan Africa, using systematic planned comparisons coupled with recent advances in information technology to capture monitoring data from large sample sizes with simple data recording formats with smart phones apps.

This will generate unique data from which a much deeper understanding of the factors that control performance of different agroforestry options (tree species and management practices) can be derived.

Silvopastoral systems

2017 sees the dawn of a new research cluster within our Flagship on silvopastoral systems. It will be co-ordinated by CATIE in Costa Rica but involves research globally, including on the effect of pruning fodder trees in the Sahel, dairy development in East Africa and the value of bamboo as a fodder resource.

In addition to being a strategic fodder resource, trees on pastures have huge potential to reduce stress on livestock that accounts for huge production losses and for animal welfare concerns.

We will work with FTA Flagship 5 on the key role that trees on pastures can play in climate mitigation and adaption strategies for cattle production systems and hence with FTA Flagship 3 how they can underpin sustainable beef certification.

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  • Linking sustainable supply, inclusive business models and innovative finance

Linking sustainable supply, inclusive business models and innovative finance

Pressures on forests and lands forests and lands are increasing as the world population and economies keep growing. Oil palm workers in Indonesia returning home. Photo: Icaro Cooke Vieira/CIFOR
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Pressures on forests and lands forests and lands are increasing as the world population and economies keep growing. Oil palm workers in Indonesia returning home. Photo: Icaro Cooke Vieira/CIFOR

By Pablo Pacheco, Team Leader – Value Chains, Finance, & Investments, Center for International Forestry Research (CIFOR), Coordinator of Flagship 3

Pressures on forests and lands are increasing as the world population and economies keep growing. This pressure also leads to better solutions from public and private actors to enhance sustainable supply mechanisms and integrate smallholders in supply chains. In this context, Flagship 3 Sustainable global value chains and investments for supporting forest conservation and equitable development embraces the challenge of researching and providing options of how value chains and investments can be made more sustainable and inclusive, and leverage the potential of finance for scaling up.

In 2017, Flagship 3 will identify knowledge gaps, distill best practices, produce methods and tools, convene stakeholder meetings, engage in business and multi-stakeholder platforms, support learning initiatives, and co-generate options of policies and practices to:

  • Improve the sustainability of forests, agricultural and tree-crops production in forest landscapes by identifying complementarities between public regulations on the one hand, and private standards and commitments on the other hand;
  • Inform businesses and service providers about business models that are more inclusive, gender-responsive, economically viable and environmentally sustainable;
  • Increase investment flows in forest and tree-crop sectors by helping develop innovative finance mechanisms to support smallholders and small- and medium-scale enterprises (SMEs).

The three groups of activities we embrace have interconnected goals and approaches. The first goal examines the policy and institutional environment shaping the governance of supply chains, with special emphasis on supply chain and territorial interventions.

Assessing the impacts of certification standards in cacao and coffee is part of the work on value chains.Photo: Icaro Cooke Vieira/CIFOR

The second goal focuses on business models in timber and tree-crop value chains that link corporations with smallholder farmers and small and medium enterprises (SMEs).

The third goal assesses how the financial sector influences the social and environmental performance of value chains and businesses, and how innovative finance provides opportunities for smallholders and SMEs.

Enhancing public and private arrangements for sustainable supply

Research under this theme will equip farmers, businesses and the public sector with knowledge of institutional arrangements and management systems to produce agricultural crops and manage forests in more integrated and sustainable ways—and in compliance with social and environmental standards.

We will focus our efforts on producing synthesis to engage in two international processes (e.g. FLEGT, zero deforestation) and to inform two regional/national policy dialogues on the public-private governance mechanisms that are needed to enhance sustainable supply in order to ease the pressures on forests. Our primary focus will be on timber in Central Africa and oil palm in Southeast Asia.

Timber is another key commodity in this research area. Photo: Tomas Munita/CIFOR

We will complete analysis on the governance of timber value chains (Cameroon, Zambia, Uganda) and of palm oil in Indonesia, and link analysis on the connections between global sustainability processes (e.g. FLEGT VPA, RSPO, ESPO) with national regulations and initiatives to enhance sustainable supply in the timber and oil palm sectors.

More complex policy regimes are emerging linking public regulations and private standards, yet there is need to connect them and build complementarities between them.

We are also supporting the development of monitoring tools and approaches to assess progress in performance of corporate commitments to sustainability with focus on oil palm, cacao and timber. We are also assessing the impacts of certification standards in cacao and coffee.

Supporting initiatives to foster the development of inclusive business models

Better knowledge is needed on how to build business options and fair partnerships that create opportunities for smallholder farmers who are increasingly involved in global value chains. This research also aims at safeguarding the rights of marginalized groups such as women and indigenous people.

We will advance work on inclusive business models by operationalizing a strategic partnership with the Dutch development organization SNV. This partnership is aimed at building and testing approaches and interventions that improve the effectiveness of inclusive business models across several SNV projects. In addition, we will support ongoing multi-stakeholder processes for strengthening capacities and policy environments for smallholders and SMEs in the timber and oil palm sectors in some select countries and landscapes.

Our main efforts will be on assessing the technical and economic performance of independent oil palm smallholders in West and Central Kalimantan, Indonesia and of outgrower schemes implemented in the oil palm and sugarcane sectors across some select countries (e.g. Brazil, Tanzania and Mozambique). This will yield some recommendations on building more inclusive models.

We are also working on developingapproaches to design project interventions that consider the specific needs of women and youth in more inclusive business models.

Engaging with responsible finance institutions and impact investors

We want to build bridges to connect responsible financial institutions and innovative financing mechanisms with smallholders and land users in forest landscapes. The goal here is to embrace more sustainable practices and inclusive business models under reduced financial and territorial risks, and to achieve greater social benefits for smallholders and SMEs accessing those financial resources.

Our work on finance and investments, with support from our partners (e.g. The Finance Alliance for Sustainable Trade, FAST), will engage key financial institutions and impact investment funds and managers to identify the demand for responsible finance and their challenges to undertake investments at scale especially in forest landscapes.

We will focus on identifying existing schemes and demand for responsible finance and impact investment, and their challenges. Besides that, we will advance studies on palm oil in Indonesia and cacao in Ghana related to innovative finance schemes to overcome barriers facing smallholders who want to take up more efficient and sustainable practices. This work has the potential to trigger transformational change.


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  • Smallholder farmers’ perceptions of climate change and the roles of trees and agroforestry in climate risk adaptation: evidence from Bohol, Philippines

Smallholder farmers’ perceptions of climate change and the roles of trees and agroforestry in climate risk adaptation: evidence from Bohol, Philippines

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Recent studies have highlighted the importance of trees and agroforestry in climate change adaptation and mitigation. This paper analyzes how farmers, members of their households, and community leaders in the Wahig–Inabanga watershed, Bohol province in the Philippines perceive of climate change, and define and value the roles of trees in coping with climate risks. Focus group discussions revealed that farmers and community leaders had observed changes in rainfall and temperature over the years. They also had positive perceptions of tree roles in coping with climate change, with most timber tree species valued for regulating functions, while non-timber trees were valued as sources of food and income. Statistical analysis of the household survey results was done through linear probability models for both determinants of farmers’ perceived changes in climate, and perceived importance of tree roles in coping with climate risks. Perceiving of changes in rainfall was more likely among farmers who had access to electricity, had access to water for irrigation, and derived climate information from government agencies and mass media, and less likely among farmers who were members of farmers’ organizations. On the other hand, perceiving of an increase in temperature was more likely among famers who were members of women’s organizations and had more off/ non-farm sources of income, and less likely among those who derived climate information from government agencies. Meanwhile, marginal effects of the regression on perceived importance of trees in coping with climate change revealed positively significant relationships with the following predictor variables: access to electricity, number of off/non-farm sources of income, having trees planted by household members, observed increase in temperature and decline in yield, and sourcing climate information from government agencies. In contrast, a negatively significant relationship was observed between recognition of the importance of tree roles, and level of education, and deriving income from tree products. In promoting tree-based adaptation, we recommend improving access to necessary inputs and resources, exploring the potentials of farmer-to-farmer extension, using participatory approaches to generate farmer-led solutions based on their experiences of climate change, and initiating government-led extension to farmers backed by nongovernment partners.

Authors: Rodel D. Lasco, Marya Laya O. Espaldon, Christine Marie D. Habito

Published at Agroforestry Systems, June 2016

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  • Situating smallholders at the fore

Situating smallholders at the fore

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Photo: Achmad Ibrahim/CIFOR
A child rests amid felled trees in Central Kalimantan, Indonesia. Achmad Ibrahim/CIFOR

By Deanna Ramsay, originally published at CIFOR’s Forests News

Mediating the push and pull of agricultural expansion and conservation is no easy task. Add to that smallholders – who play a crucial role in producing agricultural commodities but whose economic disenfranchisement can incline to unsustainable practices – and the situation becomes even more complex.

With increasing corporate commitments to eliminate deforestation from supply chains, the integral, and precarious, situation of smallholders must be addressed. But how can companies help to empower them, disincentivizing deforestation and unsustainable practices? What must government, civil society and the financial sector do? And, what would a successful smallholder empowerment project look like?

At the upcoming Asia-Pacific Rainforest Summit (APRS) in Brunei from 3 to 5 August, these questions will be discussed by diverse representatives from government, business, civil society and the research community.

In an interview on the sidelines of the recent Global Landscapes Forum: The Investment Case, Center for International Forestry Research (CIFOR) principal scientist Pablo Pacheco – who will be chairing the smallholder session at APRS – addressed the thorny question of smallholders, investing and sustainability.

A lot of private sector investment today – in spite of all the capital – doesn’t seem to always reach smallholders. Any observations?

That depends whose sector we’re looking at. I think there’s a large amount of smallholders that don’t have access to capital. But there’s a small group of smallholders who embrace more commodity crops and they are more connected to companies and global markets who have some access to capital because that capital comes through the agreements that these smallholders have with companies.

And if they have access to some sources of funding or finance, often they have access to informal markets. Because in many cases it is the intermediaries who provide the capital to smallholders. But the fact is that the capital that’s coming from informal sources tends to be more flexible for smallholders. It works for smallholders in some contexts but it’s much more expensive. The money is less reliable. So they have access to capital, but it’s much more expensive.

I think the problem of smallholder finance has been how to make this access to capital more affordable.

Do you think over the years there has been improvement? In terms of private sector investment, has it managed to benefit smallholders?

That depends. I think there’s a portion of the private sector that has been able to build links with smallholders through outgrowing schemes. And I think you have companies that have been able to provide capital to smallholders, and not just capital but also technical assistance and to build the services into the links that they have for smallholders.

They have to ensure that they have enough quality of supply and stable supply coming from these outgrower smallholders. But the fact is that now companies are making commitments to source supply that is clean, that is deforestation free. And I think that’s one of the main issues that they’re struggling with is how to build these clean sources of supply that involve smallholders.

But that is going to imply for them to build some kind of agreements with these groups of smallholders that are supplying these companies. So that’s the big issue. Because the majority of smallholders are independent smallholders, like in the oil palm sector in Indonesia.

And who do you think should pay for the costs of smallholders transitioning to these more sustainable means of production?

I think what is needed is business models that are able to share those costs – share the cost, share the risks and share the benefits. Because in most of the cases you have business models that then transfer the costs to the producers that are upstream in the supply chains. So they are the ones who pay for the cost. In an ideal situation, the companies also should be able – if they are targeting deforestation free in markets – they should be able if there is some reward to transfer the rewards upstream in the value chains.

So the smallholders can also benefit or receive some compensation on the costs that they are investing in improving the production systems. But that is still an open question, and we don’t know if that’s going to work in that way.

What can the financial sector and banks do today to help the livelihoods of smallholders?

They are in a difficult position. Because even though they may have the willingness and the capital available for investing with smallholders, the transaction costs are very high for them to provide this capital to smallholders. So they really need these microfinance institutions, cooperatives, these aggregators. Channeling the money through aggregators could be a way to reduce the transaction costs of that lending.

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  • When small meets big in the value chain

When small meets big in the value chain

Storage of gum for export. Photo: Ollivier Girard/CIFOR
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Market in the village of Minwoho, Lekié, Center Region, Cameroon. Photo: Ollivier Girard/CIFOR
Market in the village of Minwoho, Lekié, Center Region, Cameroon. Photo: Ollivier Girard/CIFOR

By Michael Casey, originally published at CIFOR’s Forests News

For centuries, life for smallholder farmers in Africa and Asia was relatively simple. They grew crops, kept the necessary amount to feed their families and then sold the rest at the local market.

But these days, the value chain is much more complicated.

Multinational conglomerates, development agencies, conservationists and even certification groups often play a role in what is grown, which can influence the price a farmer fetches for products like cocoa and palm oil.

Now, a new study has found that these value chain collaborations can be a force for good for smallholder farmers, who produce 80 percent of the food in Africa and Asia.

“These partnerships potentially give farmers benefits in terms of addressing poverty, food security and sustainable production,” said Mirjam Ros-Tonen of the University of Amsterdam and a former visiting scholar at the Center for International Forestry Research (CIFOR).

“There is also some evidence that these farmers are better off when they are integrated in the value chain,” said Ros-Tonen, who is the study’s lead author.

She noted that multinational companies embark on these kinds of partnerships because it is in their own interest.

“They have an interest in sustainable supplies and they have an interest in their suppliers doing well,” she said. “That’s why they invest in food production and farmers’ livelihoods.”


Smallholders face challenges... Photo: Ollivier Girard/CIFOR
Smallholders face challenges… Photo: Ollivier Girard/CIFOR

But such relationships have to be monitored, as farmers are often at a distinct disadvantage when it comes to working with multinational companies or government agencies.

“There is evidence that farmers lose autonomy in certain types of partnerships,” Ros-Tonen said.

Pointing to palm oil in Africa as an example, Ros-Tonen cites reports of companies coming into a region and convincing growers to combine their plots into larger ones. Although that might be good for production, this could expose communities to shortages of other food crops that they depend on to survive.

“Farmers are losing their say over what happens with their land because oil palm is going to be planted on it,” she said.

“That might jeopardize their access to food because they might have less land available for food production. It might not be sustainable at all because the production system implemented is monoculture.”

...when they enter the supply chain. Photo: Murdani Usman/CIFOR
…when they enter the supply chain. Photo: Murdani Usman/CIFOR

Commodity and agriculture companies can also make matters worse by failing to distribute the benefits of these value chain collaborations to all farmers, including women.


A ‘landscape approach’, which recognizes that land is used in multiple ways and considers both the environment and human systems that depend on such land, can contribute to resolving these issues.

Terry Sunderland, a co-author of the study and a principal scientist at CIFOR, said that such an approach could help people who usually don’t have a seat at the table.

“With stakeholders in landscapes, people will only engage if they feel they have some influence on the process. If they feel that the process has a trajectory already, they’ll just turn their backs. They’ve got other things to do, like feed their children,” he said.

“Having strong facilitation, whether it’s individual or institutional, is key to these kind of relationships. You can’t just have farmers talking to a company. There has to be some kind of process of facilitation.”

In the study, the authors call for all parties to work together more closely and share knowledge.

Storage of gum for export. Photo: Ollivier Girard/CIFOR
Storage of gum for export. Photo: Ollivier Girard/CIFOR

That might sound simple enough, but often this does not happen because of traditional barriers that exist between government agencies, the private sector and NGOs.

“We need new methods and new institutional arrangements to get diverse stakeholders together and have joint knowledge exchanges,” Ros-Tonen said.

Ros-Tonen and her co-authors dismissed concerns that farmers opt out of value chain collaborations because market integration “unfolds through a number of crises across different scales, which include the steady erosion of local farming knowledge, a narrowing of choices for producers and consumers, and an increased incapacity of food systems to feed the world in a sustainable and healthy manner.”

While they said those concerns weren’t completely unfounded, they said it should be up to farmers how they proceed – many of whom told the researchers that they want to be part of the global economy.

“There is an ideological stand in rejecting value chain integration, and proponents of food sovereignty and those who reject value chain integration claim to speak on behalf of the farmers,” Ros-Tonen said.

“But when we speak to cocoa farmers in Ghana, they say: ‘We want to be part of this market. It improves our lives. We have bigger income because cocoa has a fixed price.’”

Striking the right balance is essential, and at the 2016 Global Landscapes Forum: The Investment Case, discussions between the finance, corporate, government and NGO sectors took place with the objective to improve investments in sustainable landscapes.

Such work can help bridge the gap between private finance and sustainable landscapes, working toward enhancing the livelihoods of smallholders and the environment, and is an example of the facilitation and knowledge exchange that the study’s authors call for.

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  • Landscapes of Social Inclusion: Inclusive Value-Chain Collaboration Through the Lenses of Food Sovereignty and Landscape Governance

Landscapes of Social Inclusion: Inclusive Value-Chain Collaboration Through the Lenses of Food Sovereignty and Landscape Governance

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Authors: Ros-Tonen, M.A.F.; Van Leynseele, Y-.P.B.; Laven, A.; Sunderland, T.C.H.

Value-chain collaboration (VCC) aims to increase smallholder productivity and market integration. Higher productivity, better incomes and innovations have been documented, but also exclusionary trends and loss of biological and dietary diversity. New forms of VCC ‘beyond the chain’ hope to tackle this through collaboration with non-chain actors. Drawing on territorially embedded VCC, food sovereignty and landscape governance theories, this article presents a conceptual framework to analyse whether and how inclusive VCC, greater farmer autonomy and sustainable landscapes can be achieved. Key elements of our approach are knowledge of smallholders’ various livelihood trajectories and selective value-chain engagement; multi-stakeholder definition of the sustainability choice space; and smallholder inclusion in adaptive learning and empowerment processes that bring together and integrate different and oft-competing knowledge systems and governance levels. This approach will support further action research in learning platforms in Ghana and South Africa. The article discusses the link with the broader inclusive development debate.

Publication Year: 2015

ISSN: 0957-8811

Source: European Journal of Development Research 27: 523-540

Also published at Center for International Forestry Research (CIFOR)

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  • Triple win from efficient cook-stoves and firewood from agroforestry

Triple win from efficient cook-stoves and firewood from agroforestry

Firewood from Grevilliea prunnings drying in a shed. Photo by James Kinyua/World Agroforestry Centre
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Open fire three-stone cook stove. Photo: Mary Njenga/ World Agroforestry Centre
Open fire three-stone cook stove. Photo: Mary Njenga/World Agroforestry Centre

By Susan Onyango, originally posted at ICRAF’s Agroforestry World Blog

According to the International Energy Agency (IEA), about 2.5 billion people in the world, mostly in developing countries, depend on biomass energy for cooking and heating. In sub-Saharan Africa alone, over 90% of the population rely on wood fuel, particularly charcoal and firewood, for their cooking energy needs. Firewood for domestic use is collected from both on-farm and off-farm sources.

The commonly used traditional open-fire three-stone cook stoves consume large amounts of firewood and create indoor air pollution. Smoke in the kitchen is a major concern to those that lack access to clean cooking facilities. According to the World Health Organization, over 4 million people die annually from illnesses attributable to indoor pollution from cooking with solid fuels such as firewood and charcoal. Children and women are particularly vulnerable to this silent killer.

Cecily Muthoni is smallholder farmer in Embu, on the slopes of Mount Kenya about 120 kilometres north east of the country’s capital, Nairobi. On her one-acre farm, she grows cassava, beans, maize, Irish potatoes and a range of vegetables for subsistence, alongside tea, coffee and macadamia nuts as cash crops. She also grows sugarcane, mangoes, avocados and bananas for sale and home consumption.

Muthoni has about 170 exotic and indigenous trees on her farm. She has two cows, two goats and a few poultry. Like other women in her community, she uses both a charcoal stove and the three-stone cook stove to prepare meals for her family of five. Virtually all households in Embu use firewood on three-stone cook stoves, with over 70% of the population sourcing it from trees on their own farms.

Cecily Muthoni with Grevillea prunnings from her farm. She mostly sources firewood from trees on her farm or from her neighbours’ farms. Photo: James Kinyua/World Agroforestry Centre
Cecily Muthoni with Grevillea prunings from her farm. She mostly sources firewood from trees on her farm or from her neighbours’ farms. Photo: James Kinyua/World Agroforestry Centre

She would have possibly stretched this if she used an energy efficient cook stove. When her stocks are low, she purchases firewood from her neighbours at Ksh. 100 (about USD 1) per lot of 34 kilogrammes. The same quantity of firewood costs over Kshs. 200 (about USD 2) from other sources.

Prunings from trees found on farms are a readily available and affordable source of energy for cooking. What households like Muthoni’s need are efficient cook stoves that use less wood fuel and with less smoke than conventional cook stoves.

Options for cleaner cooking solutions

A recent study by a team of scientists compared the ease of use, fuel use efficiency and gas and particle emissions of a small-scale gasifier cook stove with that of the traditional three-stone stove.

Gasifier stoves use biomass and burn fuel at low oxygen levels to produce gas that ignites at high temperatures of about 7000C resulting to reduced emissions of carbon monoxide, carbon dioxide and fine particulate matter. The stoves burn on firewood and crop residues such as coconut shells and husks, and maize cobs. These are converted into charcoal as a by-product and can also be used for additional cooking, or as biochar to improve the retention of nutrients and water in soil. The traditional three-stone cook stove uses larger pieces of firewood and produces a lot of smoke particularly if the wood is not properly dried.

Firewood from Grevilliea prunnings drying in a shed. Photo by James Kinyua/World Agroforestry Centre
Firewood from Grevilliea prunnings drying in a shed. Photo by James Kinyua/World Agroforestry Centre

The cooking test

The study involved cooking experiments in which five households were randomly selected to participate. The trials compared the effect of using Grevillea prunings, against maize cobs and coconut husks as types of fuel on the gasifier stove. Five-person meals were cooked between 3p.m. and 6 p.m., with five tests carried out in each household.

“We found that compared with traditional three-stone cook stoves, the gasifier cook stove saves 27 to 40% of fuel, reduce cooking time by 19 to 23% and reduced emissions by 40 to 90%,” said Mary Njenga, lead researcher for the study and scientist at the World Agroforestry Centre.

The women felt that adopting the gasifier would help cook food faster and save the amount of firewood they needed, freeing time for other activities and reducing the burden on collecting firewood. They also pointed out that the gasifier uses smaller pieces of firewood than other types of stoves, making tree pruning a good source of cooking fuel. For some, the need to cut firewood into small pieces to fit into the canister was a bit cumbersome as it required additional labour. The coconut shells and maize cobs did not require any prior preparation.

The Grevillea prunings cooked food faster than the maize cob and coconut shells while the maize cobs produced more smoke than the Grevillea prunings and the coconut shells.

“I found the gasifier stove good to cook with. It will help me cook faster and save the amount of firewood I need. This will give me more time to do other activities and reduce the burden of searching for firewood,” said Muthoni. “However, this stove does not produce as much warmth in the kitchen as the traditional three-stone cook stove does. We often sit in the kitchen during the cold season to warm ourselves.”

Benefits of the gasifier cook stove

There is an opportunity for extending use of the gasifier to address energy poverty and health risks associated with domestic biomass energy in developing countries. Use of prunings from trees on farms and reduced consumption of charcoal and firewood will save trees and encourage forest regeneration. In the long-term, this will contribute to climate change mitigation. Charcoal is a by-product of the biomass burned in the gasifier stove and can be used as fuel for use on other cook stoves.

The researchers recommend improvements to respond to women’s cooking practices to encourage the use of the gasifier stove. It is noted that a household’s commitment to saving fuel, reducing smoke in the kitchen and lessening labour for firewood collection are major considerations for the adoption of the gasifier cook stove

“The gasifier cook stove saves fuel and income spent on energy for cooking. It also produces charcoal for further cooking, for sale or use for improving the retention of nutrients and water in soil, cooks relatively fast and reduces indoor air pollution from cooking with biomass. There is need for further work to understand peoples’ cooking culture using wood fuel and other biomass and how it fits into cleaner cooking solutions for increased demand and adoption,” concluded Njenga.

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  • Allanblackia: A promising cash crop

Allanblackia: A promising cash crop

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By World Agroforestry Centre

Allanblackia is a multipurpose indigenous fruit tree species to 40 metres high, commonly found in parts of West, Central and East Africa and could be used in agroforestry systems with both environmental and economic benefits. It grows primarily in tropical rain-forests and farmland areas.

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  • Alternative crops for smallholders: ‘Livelihoods insetting’ attracts oil-palm players

Alternative crops for smallholders: ‘Livelihoods insetting’ attracts oil-palm players

A villager brings oil palm fruits out from the plantation. Jambi, Indonesia, December, 2010. Photo: Iddy Farmer/CIFOR
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By Rob Finlayson, originally posted at Agroforestry World Blog

Photo: World Agroforestry Centre
Photo: World Agroforestry Centre

The idea of creating multiple agricultural alternatives for farmers within oil-palm landscapes has attracted interest from large industry players at a conference in Malaysia, the world’s second-biggest producing nation.

Oil palm (Elaeis guineensis) is one of the most controversial agricultural commodities of our time. To its supporters, it is the ‘golden crop’ that grows smallholders out of poverty and which offers salvation to the global food and energy crisis. For its critics, it is the single biggest driver of the destruction of peatlands and rainforests that accelerates greenhouse-gas emissions, posing a fundamental threat to existence as we know it.

‘Mainly because of consumer concerns, but also because of the realisation that resources are not infinite’, said Faisal Mohd Noor, speaking at the International Palm Oil Congress and Exhibition in Kuala Lumpur in October 2015, ‘the industry is changing’.
Noor, an oil-palm researcher working with the oil-palm sentinel landscape theme of the CGIAR Research Program on Forests, Trees and Agroforestry, met with a warm reception from industry leaders to his research team’s proposal for ‘livelihoods insetting’, which simultaneously addresses consumer concerns about oil-palm sustainability and industry concerns about productivity. ‘Insetting’ involves embedding sustainable activities directly into a business’s supply chain and leads to the build-up of human capital in the communities involved.

Photo: World Agroforestry Centre

Photo: World Agroforestry Centre


A working example of insetting is the African-orphan-crops consortium funded by Mars Inc. Bruno Roche, Mars’ chief economist and Catalyst program managing director, has claimed success for insetting, stating that, ‘We know that investing in the human capital of communities in our sourcing landscapes leads to a higher productivity and profit for us’.

In response to Noor’s presentation, head of certification for the Roundtable on Sustainable Palm Oil (RSPO), Jan van Driel, asked what RSPO could do to help and how it could participate; Faris Adli Shukery, head of marketing with Sime Darby Foods and Beverages, said that the oil-palm industry has been the driving force behind the development of the rural people of Malaysia and Indonesia and livelihood insetting is an interesting concept that would make the contribution of the industry more visible to consumers of palm-oil products.

Speaking on the sidelines after Noor’s presentation, Genting Plantations’ Chew Jit Seng, vice-president for sustainability, stated that insetting was a good idea to pursue, as did International Sustainability and Carbon Certification’s managing director Norbert Schmitz, while the Malaysian Palm Oil Council’s chief executive Dato’ Dr Makhdzir Mardan said it was something to be encouraged with his full support.

‘Insetting isn’t a new idea but is usually only used in the context of mitigating environmental impacts, such as land degradation, biodiversity and climate change. What is new is that we are asking the industry to work together with other partners to set up market structures and functional value chains for other agricultural and forest products’, explained Noor. ‘Put simply, insetting would see the oil-palm industry investing in building alternative agricultural livelihoods’ options for farmers in oil-palm landscapes’.

Research by the World Agroforestry Centre and others has shown that farmers with diverse livelihoods are more resilient towards fluctuating global prices as well as climate shocks. But as well as better serving the smallholding producers of oil palm, insetting also promises to support the main aim of the oil-palm industry.

A villager brings oil palm fruits out from the plantation. Jambi, Indonesia, December, 2010. Photo: Iddy Farmer/CIFOR
A villager brings oil palm fruits out from the plantation. Jambi, Indonesia, December, 2010. Photo: Iddy Farmer/CIFOR

‘It’s important to note that insetting isn’t simply a different packaging of corporate social responsibility’, continued Noor. ‘It’s actually directly linked to the industry’s core business: increasing productivity. Farmers who are happier and better off are more likely to produce high palm-oil yields than farmers who eke out a marginal existence’.

Diverse agroforestry systems have been proven to broadly improve farmers’ livelihoods unlike monocultural crops that put farmers at the mercy of market and climate fluctuations.

‘The presentation was just an introduction of the concept to industry,’ explained Noor. ‘However, the message is clear that the palm-oil industry must change its strategy. With forward thinking, such as widespread adoption of insetting, the industry can stop being in defensive mode and prove it is really serious about sustainability.

‘But to do that, the industry has to change itself. One of the biggest challenges is how most people in the industry think about agriculture. The concept of mixed crops, or integrated farming, seems to have almost vanished from the mindset of the agriculturalists I spoke with at the conference. So it is critically important to get the industry leaders interested in diversification, produce research that will guide implementation and help them promote it widely amongst all players’.

The situation is critical for governments not only because of the falling revenues from the palm-oil industry but also for the security of incomes and food supply for citizens. Oil palm is not a very suitable crop for smallholders because it requires high upfront investment, is difficult to manage—especially for older people—and needs intensive input to produce high yields. Countries with higher incomes and ageing agricultural workforces, such as Malaysia, are experiencing a critical labour shortage. Malaysia has a high dependency (> 70%) on migrant workers, mainly from Indonesia. Now that Indonesia has become the main palm-oil producer and is offering the same wage levels, most migrant workers have returned to their home country. Addressing the problem through mechanization is not looking plausible owing to only poor-quality machinery being available.

At the same time, for most Indonesian and Malaysian farmers, oil palm has become the only possible use for their land, because there are no, or weak, market structures for other agricultural products.



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  • “White gold” beans to beat drought in Ethiopia

“White gold” beans to beat drought in Ethiopia

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The beans are known as "white gold" because of the high income they fetch.

The beans are known as “white gold” because of the high income they fetch.

New drought-resilient white beans – most commonly used to make baked beans – will be deployed to Ethiopia, as erratic weather threatens national production and farmers’ incomes.

Severe drought in Ethiopia, Africa’s largest exporter of the bean used to make baked beans, could hit production for millions who cultivate and rely on income from the bean. The drought – the worst to hit the country’s bean-producing areas in 10 years, researchers report – has cut yields by 30 percent.

Low rainfall at the height of the bean season in the Rift Valley can also reduce bean quality. Combined with other factors influencing the world price – the beans are exported mostly to Europe for canning –farmers are expected to less income and prices have already fallen.

Transformed from a neglected staple into a cash crop, with exports worth more than US$90 million, the grain provides income for around three million smallholder farmers in Ethiopia who rely on white bean sales – known locally as “white gold”- to buy food and cover other costs like school fees. Thousands more are employed in postharvest processing of the beans for export.

Drought during this stage of bean development could bring a major crisis for farmers, who won’t have cash to put food on the table. An international research network is preparing to deploy the latest drought-resilient bean varieties to Ethiopia, to be tested and evaluated by researchers at the Ethiopian Institute of Agricultural Research (EIAR).

Preparing ground at EIAR.

Baked bean threat

As Africa’s only major exporter and biggest producer of the white beans for processing into baked beans, Ethiopia accounts for about 10 percent of the global supply. Farmers can usually sell the bean for three times more income than that from other crops, like maize, and can also rely on beans as a source of nutrients in the local diet.

Eliud Birachi, market economist with the Pan-African Bean Research Alliance (PABRA) – a research network that better enables national partners like EIAR to solve trade-related problems of beans – said tackling climate-related issues is critical given rising demand.

“Not only are we seeing a change in the habits of African consumers especially in urban areas, with canned and processed foods like baked beans becoming more popular. But also, investment in canning and processing technology is growing, so we expect more demand for canned bean varieties – both in Africa and abroad,” he said.

The biggest impacts of climate change are expected to be reduced volume of beans on the market, together with increased incidence of pests and diseases, he added. “This is a risk for canning companies who depend on Ethiopia for their bean supply. But it represents a double risk for farmers,” he explained.

“If export volumes decline, the global cost of beans could go up, because there will be less grain on the market. This could drive up production costs in future – and push white bean production from smallholders to commercial farmers, who can afford expensive equipment.”

It could also mean other countries already equipped with large-scale technology could produce and process more competitively. “That would be a net loss for Ethiopia and smallholder farmers – the biggest producers of these beans. Our key concern is keeping production, and the benefits, in their hands.”

This community in Ethiopia built the community hall with money from white beans.This community in Ethiopia built the community hall with money from white beans.

“White gold” revolution

In the last decade, Ethiopia has become the first African country to prioritize white bean production, boosting its exports from US$8 million in 2004 into more than US$90 million today. Production has more than doubled from 211,347 tons to 455,115 tons between 2004 and 2014.

This success is partly due to PABRA’s efforts to make the high-quality bean varieties that exporters demand readily available to farmers: Seed access has risen from 20 to 65 percent for farmers since 2004. Better bean varieties, bred and released by EIAR with support from the PABRA network, are also more tolerant to drought, pests and diseases.

The company Agricultural Commodity Supplies (ACOS) – also a PABRA member – exports around 220,000 of Ethiopia’s total production annually and has been central to the white bean’s transformation. Eighty percent of its produce is exported to Europe, but opportunities are expanding globally.

Mekonnen Kebede, agronomist and contract farming coordinator for ACOS Ethiopia, said: “Demand is there, but it’s not being met fully with what farmers supply. There is still a lot to be done; that’s why we work closely with researchers to improve quality.”

Drought-tolerant varieties recently released by EIAR, with support from the International Center for Tropical Agriculture (CIAT) – which facilitates the PABRA network – and other partners, outperform other commercial varieties by 10 percent.

New bean varieties help farmers stay ahead of different threats, including those posed by climate change. New bean varieties help farmers stay ahead of threats, including those posed by climate change.

Staying ahead of climate threats

Future climate scenarios point to increased climate variability, which could lead to more extreme weather conditions – swings in temperature and rainfall – in turn affecting productivity, researchers say.

White bean varieties with enhanced drought tolerance are currently undergoing final tests at CIAT’s headquarters in Colombia, before being shipped to EIAR early next year. Then, the beans will undergo more rigorous tests for drought resilience, disease resistance, and canning quality in the local context.

Within two or three years, the best-performing varieties will have been whittled down to two or three top choices by researchers in Ethiopia. These will be evaluated by a release committee and officially approved before being made available for farmers to buy and grow.

Louise Sperling, seeds expert at Catholic Relief Services (CRS), says making improved bean varieties available for farmers, especially during times of crisis, is vital for smallholder livelihoods. “In Ethiopia, beans are multiplied by far-flung communities – definitely a step in the right direction,” she said.

“But with the onset of climate change, farmers need a portfolio of crops to strengthen their farms against climate shocks. New varieties can build resilience and co-exist with local varieties. It’s not just about helping farmers make more money. It’s also about adapting to change and providing nutrition.”

Sperling will deliver a keynote address on the importance of strengthening bean seed systems at an event to be held on 14 October in connection with the World Food Prize, 2015 Borlaug Dialogue, taking place in Des Moines, Iowa, USA. Titled “Breaking the bottlenecks to scale up bean seed systems in Africa,” the event is being organized by CIAT and the Syngenta Foundation.

For more information:

Contact g.smith at cgiar.org or n.russell at cgiar.org

Download photos. Credits: Georgina Smith /CIAT

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Source: CIAT News

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Efficacy of oil palm intercropping by smallholders: Case study in South-West Cameroon

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Intercropping oil palm during its immature stage with food crops is usually blamed for its negative impact on the growth and future yields of palms. Agro-industries unanimously condemn such practice. For smallholders on the contrary, intercropping presents numerous advantages as it not only covers the weeding cost but also provides food and revenue while waiting for the palms to come into production. While such trade-off may be of little interest to an agro-industry, it appears as determining for many smallholders. The study was carried out in seven communities in the Bamuso Sub-division of the South–West Region of Cameroon and seeks to understand how smallholder oil palm farmers (small, medium and large scale) use the intercropping technique during the early stages of oil palm development as a means to improve on their livelihood. Results indicated that, a mean annual wage of 705,000 FCFA (€1075) was obtained per hectare per household for smallholders practicing intercropping. In addition to income gained, intercropping significantly reduced the cost of weeding. The study therefore, suggests the need for pre-emptive measures—such as food crop choice, planting density amongst others—to be taken into consideration when intercropping annual food crops with oil palm so as not to jeopardize the yield of oil palm at production stage. The finding is of significance for sustainable agriculture in that intercropping encourages poverty reduction for marginalized people especially women with no access to land, maximises land use by farmers, food security in households, stability in yield and profit in smallholders’ oil palm plantations.

Source: CIFOR publications

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