Chain Management as Integrated and Multi-Disciplinary Approach

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Inadequate Access to Capital

Gabagambi (2003) and URT (2005) contend that liberalisation of financial sector necessitated Co-operative and Rural Development Bank (CRDB) which was established for serving farmers to shift its priorities away from the smallholder sector after its privatisation and acquiring a formal credit is rare to peasants (Kashuliza, 2004, Mbiha et al, 1998). Currently in Tanzania, formal financial services are concentrated in urban than rural areas. Most of lenders consider agricultural business as risky (URT, 2005). Thus, interest rates charged by commercial banks on loans are relatively high ranging between 16.4 percent and 20 percent (URT, 2004). At the same time, although the land law has been reviewed, smallholder farmers are still unable to use their land as collateral to access finance since most of them do not have legal right of ownership (certificate of occupancy) to the land they cultivate. In order to address the problem of lack of access to finance, the URT (2005) indicates that the National Micro-finance Policy (2000) was formulated with the vision of achieving widespread access to micro-finance throughout the country.

Coffee Production Trend in Tanzania

Nchahanga (2002), Mwakaje (2008) URT and the World Bank (2004), comment that Tanzania is among the well known African coffee producers and exporters. According to them, there are more than 400,000 coffee producers in this country. The crop production involves both smallholder and large-scale farmers. They observe that farming survey carried out during 1994/95 seasons large scale commercial and institutional indicated that coffee is grown on 154 commercial and institutional agricultural holdings/estates. According to this survey, these holdings were concentrated in the regions of Kilimanjaro (33 percent), Arusha (38 percent), and Mbeya (10 percent). The total planted area of coffee was 250,000 hectares whereby the privately registered companies operated the largest area of about 73 percent.

Smallholder Farming System

This is a system purely practiced by majority of rural farmers popularly known as ‘peasants’ who own small plots of about 0.5 hectare. Under this system, mild arabica coffee is either inter-cropped or grown as pure- stand cultivation, while for robusta and hard-arabica, only the inter-cropping system is adopted by farmers (MAFS, 1999). Technically, the recommended planting density for the pure-stand system is 2000 plants per hectare and 1,350 plants per hectare. According to Kessy (1999) and MAFS (1999) in the Southern Zone particularly for the newly planted coffee pure-stand cultivation is more common and plant density varies from 1000 to 2000 plants per hectare. In the traditional coffee growing zones inter-cropping is applied.

Coffee Processing in Tanzania

Coffee goes through a number of stages in moving from farm level to domestic and international markets (URT and World Bank, 2004). Primary processing takes place at farm level including harvesting, drying and grading except in the case of mild arabica coffees, which require fermentation, pulping and drying. Farmers usually sell primary processed coffee except arabica coffee in the southern zone. Farmers always process coffee at their facilities for conversion it into internationally traded quality. Currently, only two percent of the coffee is processed to final product for local consumption. The stages differ between mild arabica and robusta and also between smallholder and estate coffee. ICO (2004), Kessy (2000) and TCB (1997) observe that there are three basic stages of coffee processing namely cleaning, drying and hulling. Theynote that there are variations on how the process may be carried out, depending on the size of the plantation, the facilities available (either capital or labour intensive) and the final quality of coffee desired. There are two major types of drying before the coffee is roasted these are dry for Hard Arabica and Robusta and wet methods for Mild Arabica.

Coffee Marketing in Tanzania

The coffee from Tanzania is sold through auctions organised by TCB at Kahawa House in Moshi Municipality held fortnightly Ministry of Agriculture and Food Security (1999). Marketing of coffee in Tanzania begins at farm level where farmers sell their coffee either directly to private companies or to co- operative unions around their places through primary societies (TCB, 1997). The coffee is then delivered to the various processing factories where it is hulled and graded into various green coffee beans. Samples of these grades from all processing factories are drawn and sent to the TCB liquoring unit. Liquoring is done by tasting and classifying of coffee from each lot to determine its quality. Based on quality assessment, liquoring unit sends instructions back to factories to bulk outturns, which are of similar grade and quality.

Contents :

  • DECLARATION
  • DEDICATION
  • ACKNOWLEDGEMENT
  • LIST OF TABLES AND FIGURES
  • LIST OF ABBREVIATIONS/ACRONYMS
  • ABSTRACT
  • CHAPTER ONE: INTRODUCTION AND BACKGROUND INFORMATION
    • 1.1 Introduction
    • 1.2 Theory and Practice of Supply Chain Management
      • 1.2.1 Supply Chain Management Defined
      • 1.2.2 The Theory of SCM
      • 1.2.3 Supply Chain Management Conceptual Framework
    • 1.3 SCM Development in Agriculture-Historical Perspective
      • 1.3.1 Supply Chain Management in Agriculture
      • 1.3.2 Agricultural Production Support Activities and Services
      • 1.3.3 Agro-processing Support Activities and Services
    • 1.4 SCM Practices
      • 1.4.1 Agriculture in Tanzania
    • 1.5 Coffee
      • 1.5.1 Coffee in Tanzania
    • 1.6 Statement of the Problem and Justification
    • 1.7 Research Questions
    • 1.8 Objectives of the Study
    • 1.9 Propositions
    • 1.10 Scope of the Study
  • CHAPTER TWO: THEORY AND PRACTICE OF SUPPLY CHAIN MANAGEMENT
    • 2.2 An Overview of Supply Chain Management Theory
    • 2.3 Chain Science as an emerging Discipline
    • 2.4 Chain Management as Integrated and Multi-Disciplinary Approach
      • 2.4.1 Chain Management Decisions
    • 2.5 Definitions of Supply Chain Management
    • 2.6 Supply Chain Management in Agriculture
      • 2.6.1 SCM in Agricultural Production
    • 2.7 Coffee Supply Chain Management
      • 2.7.1 Coffee in the World Market
      • 2.7.2 Coordination of Coffee Industry
    • 2.8 The Agricultural Sector in Tanzania
      • 2.8.1 Importance of Agriculture in Tanzania
      • 2.8.2 Performance of Agriculture in Tanzania’s Economy
      • 2.8.3 Agricultural Marketing in Tanzania
    • 2.9 Practices of Coffee SCM in Tanzania
      • 2.9.1 Causes for Inadequacy of SCM
      • 2.9.2 Effects of Inadequate SCM
    • 2.10 Coffee Production, Processing and Marketing in Tanzania
      • 2.10.1 Importance of Coffee in the Tanzania’s Economy
      • 2.10.2 Coffee Production Trend in Tanzania
    • 2.11 Coffee Supply Chain in Kagera Region
      • 2.11.6 Coffee Production
      • 2.11.7 Coffee Processing
      • 2.11.8 Coffee Marketing
    • 2.12 Conclusions
  • CHAPTER THREE: THEORY AND PRACTICE CONCEPTUAL MODEL DEVELOPMENT
    • 3.1 Introduction
    • 3.2 Definitions of a Model
    • 3.3 Types of Models
      • 3.3.1 Conceptual Models
      • 3.3.2 Descriptive Models
      • 3.3.3 Experimental Models
      • 3.3.4 Exploratory Models
      • 3.3.5 Prescriptive Models
    • 3.4 Uses of Models
    • 3.5 Advantages of Application of Models
    • 3.6 Conceptual Models
      • 3.6.1 Purposes of Conceptual Models
    • 3.7 Supply Chain Management Models
      • 3.7.1 Overview of Supply Chain Models and Modelling Systems
    • 3.8 Limitations of Models
    • 3.8 Conclusions
  • CHAPTER FOUR: RESEARCH METHODOLOGY
    • 4.1 Introduction
    • 4.2 Definition of Research
    • 4.3 Research Paradigm and Philosophy
      • 4.3.1 Research Philosophies
      • 4.3.2 The Philosophy of Understanding
    • 4.4 Ethical Issues in Research
    • 4.5 Research Methods and Research Methodology
  • CHAPTER FIVE: RESEARCH FINDINGS
    • 5.1 Introduction
    • 5.2 Coffee Production
      • 5.2.1 Coffee Production Pattern
      • 5.2.2 Factors for Declining Coffee Production
      • 5.2.3 Coffee Production Services
    • 5.3 Coffee Processing
      • 5.3.1 Introduction
      • 5.3.2 Evaluation of post-harvest losses in coffee
    • 5.4 Coffee Marketing
      • 5.4.1 Introduction
      • 5.4.2 Assessment of Coffee Marketing Institutions
      • 5.4.3 Coffee Price Determination
      • 5.4.4 Coffee Marketing Support Services
    • 5.5 Assessment of Support Services in the Coffee Supply Chain
    • 5.6 Conclusion
  • CHAPTER SIX: SYNTHESIS ANALYSIS AND RESULTS
    • 6.1 Introduction
    • 6.2 Synthesis and Analysis of the Research Findings
      • 6.2.1 Coffee Production Support Services
      • 6.2.2 Coffee Processing Support Services
      • 6.2.3 Coffee Marketing Support Services
      • 6.2.4 Application of Supply Chain Management Techniques
    • 6.3 Evidence to Answering Research Questions
    • 6.4 Evidence to Support Research Propositions
    • 6.5 Conclusion
  • CHAPTER SEVEN: CONTRIBUTION TO KNOWLEDGE: CONCEPTUAL SCM MODEL
    • 7.1 Introduction
    • 7.2 Basis of Coffee Supply Chain Management Model
    • 7.3 Institutions within coffee supply chain in Kagera
    • 7.4 Coffee Supply Chain Management Conceptual Model
    • 7.5 General Requirements for Coffee Supply Chain Model
  • CHAPTER EIGHT: SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
    • 8.1 Introduction
    • 8.2 Summary of Findings
      • 8.2.1 Coffee Production Support Services
      • 8.2.2 Coffee Processing Support Services
      • 8.2.3 Coffee Marketing Support Services
    • 8.3 Conclusions
    • 8.4 Recommendations

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AN APPROPRIATE CONCEPTUAL SUPPLY CHAIN MANAGEMENT MODEL IN THE TANZANIAN AGRICULTURAL SECTOR – A CASE STUDY OF COFFEE IN THE KAGERA REGION

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