VALUE ADDED AGRICULTURE: AN ANALYSIS OF ECONOMIC RELATIONS IN THE COFFEE VALUE CHAIN IN THE NORTH WEST REGION OF CAMEROON / Value Added Agriculture: An Analysis of Economic Relations in the Coffee Value Chain in the North West Region of Cameroon

Year 2020, Volume: 4 Issue: 2, 281 - 296, 30.10.2020

Peter Ngek Shillie , Mary Juliet Bıme Egwu

https://doi.org/10.29216/ueip.703761

Abstract

This study analyses profitability with respect to value added in the coffee value chain in the North West Region of Cameroon. As objective, this study examined the economic relations at different stages of the coffee value chain. Thus, the study analysed the prices, costs, margins and profit sharing at different stages in the coffee value chain in the North West Region of Cameroon. Purposive sampling technique was used to select 40 respondents from two divisions (Mezam and Bui) who formed the study sample. Analysis employed the Cost–Return and Benefit–Cost technique to measure profitability at selected stages (coffee producers/farmers, coffee processors, coffee exporters and coffee retailers) in the value chain. Results showed that the cost of production of dry parchment, green bean, powder coffee and brewed coffee was Franc Financial Community of Africa - FCFA103,027/ha, FCFA 2,933.7/kg, FCFA 1,043.12/kg and FCFA 7,335/kg respectively with Net Profits of FCFA 15,192, CFA 1,566.3, FCFA 528.88 and FCFA 4,665 respectively. Furthermore, Benefit-Cost ratio analysis revealed that the coffee value chain is a profitable sector with Benefit-Cost values of 1.1, 1.5, 1.5 and 1.6 respectively for coffee producers/farmers, coffee processors, coffee exporters and coffee retailers. Though profitable, the study uncovered that coffee producer who apparently at the beginning of the value chain doing most of the job received the least benefit when compared with other actors. This study provided evidence that retailers were most benefited in the value chain compared to coffee producers, processors and coffee exporters. The study recommends that for a profitable coffee business within the study area, the government, coffee cooperatives and all the actors along the value chain should work in close collaboration.

Keywords

Profitability, Coffee Value Chain, Benefit Cost Analysis, Cost Return, Cameroon

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