Value Chain Approach - Aflatoxin (Groundnuts) Final Report
Between August and December 2011 Twin worked with the United States Agency for International Development (USAID) Southern Africa Trade Hub (SATH) on a groundnut value chain research project to identify risks of aflatoxin contamination related to the ingress points of aspergillus sp. in the Afri-Nut value chain. While the primary focus was on Afri-Nut in Malawi (a company that Twin has a shareholding in), Twin also took into consideration groundnut sourcing work they have done with Ikuru, a Mozambique based farmer's cooperative. The research reviewed techniques and technologies that may be applied to mitigate these risks and recommends a cluster of commercially driven interventions to facilitate change across the groundnut sector in Southern Africa.
This project involved desk research on the causes of aflatoxin contamination, techniques that have been developed to control and/or manage the risk of contamination and a review of where these have been applied in groundnut production systems.
Aflatoxin is a highly toxic metabolite produced by the ubiquitous Aspergillus flavus and parasiticus fungi. The Food and Agriculture Organization (FAO) estimates that the fungi affects 25% of the world's crops and the Centre for Disease Control estimate that more than 4.5 billion people are chronically exposed to aflatoxin through contaminated foods such as maize and groundnuts. Exposure to aflatoxin has been shown to cause cancer, immune-system suppression, liver disease, growth retardation and death in both humans and domestic animals. Aflatoxin control in high value export markets such as Europe is tightly regulated with maximum permissible levels for human consumption set at 4ppb. Value chain integration from key export countries such as Argentina has been successful in keeping imports to Europe below the maximum permissible levels.
Africa used to dominate the global export markets in the 1960s and 1970s, but a lack of investment in post-harvest handling and aflatoxin management and control contributed to a decline in market share from around 75% to less than 5% between the 1970s and 2005. Recent efforts by Twin and the National Smallholder Farmers' Association of Malawi (NASFAM) to re-engage with this market through Liberation Foods have led to the development of the Afri-Nut peanut processing plant in Lilongwe, Malawi. While Afri-Nut aims to secure market access into Europe, it has the potential to act as a catalyst for change in the peanut sector in Malawi. International trade in groundnuts only accounts for around 6% of the global production. In Malawi, 15% of the crop is exported and entry into Europe is mainly via processing in South Africa. 25% of the crop in Malawi is distributed via formal local markets while 60% is not formally traded.
The review is also informed by CODEX standards and previous quality management systems analysis on smallholder groundnut supply chain carried out by Twin and NASFAM, which led to the establishment of Afri-Nut . The review resulted in preliminary recommendations which were reviewed by a stakeholder workshop in Malawi. Potential interventions were prioritized and submitted to SATH in an interim report.
In order to have a significant and long-lasting effect on levels of aflatoxin contamination in Malawi's groundnut value chains, two phases of interventions are proposed.
It is recommended that a set of 'cluster interventions' are implemented at a nodal point in the supply chain encompassing sorting, shelling and storage. This has been chosen as the optimal place to introduce a set of cluster interventions, hereafter referred to as a shelling, sorting and storage cluster intervention (SSSCI). In essence application of SSSCI would entail:
• Trade in groundnut from farmer to depot in-shell,
• Mechanical shelling,
• Sorting under ultra violet light,
• Storage of shelled nuts in natural fiber bags.
The SSSCI will result in groundnuts being mechanically shelled in a control environment rather than by hand on the farm. This would allow groundnuts to be stored in shell for longer and avoid the shell soaking practice prior to hand shelling. Groundnuts will also undergo additional sorting under ultra-violet light and be stored in clean jute bags. These interventions make it less likely that produce will be contaminated by aflatoxin species while also increasing the likelihood that contaminated produce is removed. A positive health benefit for smallholders is that the groundnuts they intend to use for domestic consumption can undergo the same aflatoxin control and management practices as groundnuts destined for international markets.
Phase 2 will establish the business case for a groundnut value chain that removes aflatoxin contaminated nuts from the food chain and maximizes the returns from the grade outs. The proposed cluster intervention also paves the way for the establishment of a warehouse receipt in the future. If feasible, a warehouse receipt system could prove a profitable intervention with the possibility of storing additional commodities other than groundnuts.
The commercial benefits to Afri-Nut and its partners come from taking control of the crop quality as early as possible in the value chain leading to significant improvements in the conditions for the quality control at point of purchase, through storage, shelling, sorting and processing. These changes are expected to result in a considerable reduction in grade out percentages during processing at Afri-Nut and an increase in the quantity of produce that can be sold to the higher value markets where stricter aflatoxin regulations apply.
The suggested approach falls under the four pillars of the Comprehensive Africa Agriculture Development (CAADP) while also operating within Partnership of Aflatoxin Control in Africa (PACA) and the Paris Declarations guiding principles. As no single intervention to reduce aflatoxin emerges as being the most feasible, a holistic and multidisciplinary approach is required.