Altai 2004 Horticulture Phase 1 Identification Business Opportunities

8/8/2019 Altai 2004 Horticulture Phase 1 Identification Business Opportunities

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Agenda

Project Presentation

Global Market

Production and Marketing in Afghanistan

Short-Listing of Opportunities

Next Phase


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Project presentation

Objectives

Why ishorticulture akey sector topromote in

Afghanistan?

Agriculture and forestry represent 53% of the GDP

Afghanistan is a chronic food deficitcountry lack of land andirrigation water (in 2003 record year: 2.45 million ha irrigated* =1100 m2/inhabitant)

600,000 Afghan farmersare cultivating horticulture crops*

High value horticulture products give a better returnto farmers thanstaple crops

Climate suitable for high quality fruits and vegetables

Afghanistan is the center of origin of various horticulture species(pistachio, walnut and pomegranate)

Some fruit varietieshave international interest for their quality(pomegranates, apricots, almonds, raisins)

(*) Source: Various FAO agriculture surveys conducted in 2003.www.fao.org/world/afghanistan

Promote horticulture development through business opportunities for theprivate sector


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Phase 1

Market research

Supply & Demand analysis for horticulture products

Short-list of promising opportunities

Phase 3 Implementation and business plans

Phase 2 Field feasibility study

Phase 4Sourcing of stakeholders

IMPLEMENTATION



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Sources of information

ONE TO ONE INTERVIEWS

Government Institutions and InternationalOrganizations in Afghanistan

Custom officers at border points

Traders, Factories, Wholesalers,Middlemen, Retailers and Farmers in

AfghanistanBuyers in Dubai and Europe

Indirect interviews in Russia and India

REVIEW OF LITERATURE

FAO, AREU, ICARDA, UC DAVIS, DAI,WORLD BANK, UNODC, UNDP, UCTAD

CTIFL, CPI, USDA, AC NIELSEN, REUTER

MADERA, GRET

UNIVERSITY OF GENEVA

POLYTECHNIC OF LILLE

CONSTRAINTS

Difficulties to obtain reliable data (production, market, import/export): production and trade inAfghanistan are not monitored

Logistic and security constraints to travel to border points in Afghanistan

ANALYSIS OF SURVEY DATABASE

FAO, Agriculture Survey, 2003

Information research were made both from existing literature and

on the field with 5 teams investigating in main provinces of Afghanistan and abroad


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Geographical coverage of interviews

West

South-West

North

South

North-East

East

West-Central

RUSSIA

INDIA

BLUE: Indirect interviews

KABULHerat

Mazar-e Sharif

Kandahar

Jalalabad

Ghazni

Kunduz Taluqan

Peshawar

Quetta

Lahore

EUROPE

DUBAI

BamyanCharikar

Maidan Shahr

RED: Direct interviews

Islam Qala

Turghundi

Aqeena

Hairatan

Sherkhan

Ai Khanum

Turkham

Spin Boldak

GREEN: Border Custom Office interviews


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Interviews of international players

Key actors across all levels have been consulted through one to one interviews.

DRIED FRUITS TRADERSDRIED FRUITS TRADERSDRIED FRUITS TRADERS

ABDEL KHOSH IRAN

Abdel Khosh, President

CANASIA CANADA

H.J Wais, President

GLOREX DUBAI

Ramesh. D. Jatwani, Managing Director

HUSSAIN ALI KIKHA & SONS CO DUBAI

Asadulla Kikha, Chairman

VOICEVAL EUROPE

Alexis Sumar, CEO France

FOOD TRANSFORMATIONFOOD TRANSFORMATIONFOOD TRANSFORMATION

LEADING AGRIBUSINESS GROUP FRANCEPurchasing Manager(Confidential Agreement)

ALTER ECO FRANCE

Tristan Leconte, CEO

INTERNATIONAL FOODSTUFFS UAE

Olivier Dsouza, Sales Manager

MITCHELLS FRUITS FARMS PAKISTAN

Tariq Mahmood, Commercial Manager

QARSHI INDUSTRIES PAKISTAN

Dr Fahim Qureshi, Marketing Director

SHEZAN INTERNATIONAL PAKISTAN

Saifi Chaudhry, Chief Executive

LEADING AGRIBUSINESS GROUP FRANCEPurchasing Manager(Confidential Agreement)

ALTER ECO FRANCE

Tristan Leconte, CEO

INTERNATIONAL FOODSTUFFS UAE

Olivier Dsouza, Sales Manager

MITCHELLS FRUITS FARMS PAKISTAN

Tariq Mahmood, Commercial Manager

QARSHI INDUSTRIES PAKISTAN

Dr Fahim Qureshi, Marketing Director

SHEZAN INTERNATIONAL PAKISTAN

Saifi Chaudhry, Chief Executive

INSTITUTIONSINSTITUTIONSINSTITUTIONS

COLEACP EUROPE

Catherine Guichard, General Secretary

MAX HAVELAAR EUROPE

Karine Laroche, New business director

RAC (Recherche Agronomique de Changins) EUROPE

Philippe Money, Horticulturist

COLEACP EUROPE

Catherine Guichard, General Secretary

MAX HAVELAAR EUROPE

Karine Laroche, New business directorRAC (Recherche Agronomique de Changins) EUROPE

Philippe Money, Horticulturist

FRESH FRUITS TRADERSFRESH FRUITS TRADERSFRESH FRUITS TRADERS

RJA FOODS UK

Adam Pritchard, Managing Director

POMONA FRANCE

Stephane Aubert, Purchasing DirectorKIBSONS INTERNATIONAL INDIA

Husainy Sharbat, CEO

SWORLD FRANCE

Eric Bommenel, CEO


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FOOD TRANSFORMATIONFOOD TRANSFORMATIONFOOD TRANSFORMATION

AMIR FACTORY

CADG

OLIVE OIL FACTORY (MAAH)

NAJIB ZARAB

NAWAI

RAHMAT FRUIT PROCESSING CORP

SHAHRAM

WAHDAT

NAZIF

AMIR FACTORY

CADG

OLIVE OIL FACTORY (MAAH)

NAJIB ZARAB

NAWAI

RAHMAT FRUIT PROCESSING CORP

SHAHRAM

WAHDAT

NAZIF


Interviews of national players

MARKETSMARKETSMARKETS

HERATJALALABADKABUL

KANDAHARMAZAR-E-SHARIFKUNDUZCHARIKARMAIDAN-SHAR

QUETTAPESHAWAR

DUBAI

HERATJALALABADKABUL

KANDAHARMAZAR-E-SHARIFKUNDUZCHARIKARMAIDAN-SHAR

QUETTAPESHAWAR

DUBAI

TRANSPORTERSTRANSPORTERSTRANSPORTERS

ABDUL SABOORAES CARGOARIANA

AZALBAKHTAR SPEEDYCHAHAR YARDHLGHARIB ABADPOSTQADERI GROUPSAIGHAN

TAHIM SAHIBAHMAD ZAI

ABDUL SABOORAES CARGOARIANA

AZALBAKHTAR SPEEDYCHAHAR YARDHLGHARIB ABADPOSTQADERI GROUPSAIGHAN

TAHIM SAHIBAHMAD ZAI

INSTITUTIONSINSTITUTIONSINSTITUTIONS

MINISTRY OF COMMERCE

MINISTRY OF FINANCEMINISTRY OF AGRICULTURE

MINISTRY OF RURALREHABILITATIONDEVELOPMENT

RAMP CHEMONICS

CHAMBERS OF COMMERCE

ACTED AICC AISA AREU

ERO FAO IF HOPE

MADERA MERCY CORPS -ROOTS FOR PEACE

WFP - USAID

MINISTRY OF COMMERCE

MINISTRY OF FINANCEMINISTRY OF AGRICULTURE

MINISTRY OF RURALREHABILITATIONDEVELOPMENT

RAMP CHEMONICS

CHAMBERS OF COMMERCE

ACTED AICC AISA AREU

ERO FAO IF HOPE

MADERA MERCY CORPS -ROOTS FOR PEACE

WFP - USAID

One to one interviews were conducted with all kinds of actors of the value chain

IMPORTERSIMPORTERSIMPORTERS

AFGHAN EXPORTERSAFGHAN EXPORTERSAFGHAN EXPORTERS

CROSSING POINT

HAJI KHAN SHEREEN

HASEEB FAYCAL

HILOUDISMAIL ZADE

MOHAMMAD HAKIM

MUJADIDY GROUP

YOUNG GROUP

SAFITEX

SANJAR SOHEILSINA

ZIA, Etc..

IMPORTERSIMPORTERSIMPORTERS

AHMAD SHAH & AHMAD KHAR NOORDIN ZADA

AZIZ JAMIL QALA E NAWI

EZAT- E- AFGHAN RASUL FAIZE

HAJI AKHTAR SABOOR SAMIR

ITFAQ DASTAGEER ZADEN SAMI ALI MAMINI

MIRWAIS SHARIF HASSAN

MOHAMMAD AKBAR WAHEED JAN

MOHAMMAD YOUSSOUF ZIA MEHRE

MONAWAR Etc

AHMAD SHAH & AHMAD KHAR NOORDIN ZADA

AZIZ JAMIL QALA E NAWI

EZAT- E- AFGHAN RASUL FAIZE

HAJI AKHTAR SABOOR SAMIR

ITFAQ DASTAGEER ZADEN SAMI ALI MAMINI

MIRWAIS SHARIF HASSAN

MOHAMMAD AKBAR WAHEED JAN

MOHAMMAD YOUSSOUF ZIA MEHRE

MONAWAR Etc


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Agenda


Global Market



Next Phase


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Global Market

World trade Fruits and vegetables

Juices

5.5 Fresh

Fruits

19.5Processed

Fruits and

Vegetables

19Fresh

Vegetables

13

The world trade value of

horticulture products isestimated at US$ 57 billion

Processed productsrepresent 40%of the trade

123 million tons exchanged in2001, that is 10% of totalvolume (1)

World tradeof horticultureproducts grew 3.3% a year

between 1990 and 2001

(1) AgMRC, April 2003Source: USDA, 1999-2001 averages

World trade value of horticultureproducts by category

in billion US$


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Global Market

World exports Horticulture products

NAFTAEU

East-Asia

Southern HemisphereExporting Countries

Bananaexportingcountries

European Union

- 55% of imports

- 40% of exports

North America (NAFTA)

- 20% of imports

- 17% of exports

East Asia

- 12% of trade

Mostly intraregional tradetake place (e.g. 60% of Europeantrade)

Interregional tradeshave increased but are limited to:

North/South off-season imports

Banana trades

Little opportunity for export of horticulture products into the mainmarkets

3 main trading

regions

75% of world trade

Middle-East

countries


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Global Market

Dynamics of Western and East-Asian markets

Opportunities with East-Asia

East-Asia trades aredominated by the exportsfrom China to Japan

China is by far the worlds

number one producer offruits and vegetables

72 million tons of fruits,representing 15% of globaloutput(1)

300 million tons ofvegetables, 43% of global

output(2)

China exports less than1% of its productionso far

Chinese prices are highlycompetitive

(1) Rabobank, 200

(2) AgMRC, USDA 2001

Limitations to trade with Western Markets

Import opportunities to EU are more and morelimited by preferential trade agreements andvery high standards

For European fresh fruits buyers, cold chainand logistics optimizationare the main key-factors.

The US favor intra-NAFTA trades. Yet theyare not as restrictive as the EU towards extra-regional imports

Western Markets Opportunity

Products are purchased in large volumes

Main import opportunities lie in off-season products

Choice criteria of products:

Appearance of the product is more important than its taste For the fruit transformation industry, regularity of the flows

is the very first criteria

Organic is still marginalyet its share is increasing


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Opportunities with South-Asia (India, Pakistan)

India is the 2nd worlds fruitsand vegetables producer

40 million tons of fruits,representing 8% of globaloutput(1)

72 million tons of vegetables,10% of global output(1)

India signed preferential trade

agreements for mostAfghanistans horticultureproducts in 2003, clearingcustoms taxes by 50 to 100%

Pakistan is the main tradepartner of Afghanistan forfresh produce

(1) USDA, 2000

Middle-East Markets Analysis

Imports to Middle-East are estimated at $1 Billion 1

Dubai is the main trading hub for Middle-East andNorth- and East- African countries

Afghan products find it hard to position themselvesbetween high quality and more expensive USproducts and on the other end low cost products fromIran. Volumes of Afghan products are very low.

Because of growing activity, new wholesale marketwith 434 outlets to open at Al Aweer in July 2004

On-going improved quality controls program

Opportunity for counter-season vegetables andtemperate fruits

Global Market

Dynamics of Middle-East and South-Asian markets

Afghan horticulture products can enter thismarket with improved quality


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Global Market

Import markets Buyers requirements

Quality is our first concern. WE commercialize the products. WE are the ones to take the risks

Mr F., Purchasing Manager of a world leading agribusiness groupUK published a black list of exporters whose products were not conform

Pesticides Initiative Program Magazine

Major import markets tend to increase their quality standards,led by Europes strict regulation

EU main requirements

All EU food processors are required toimplement an HACCP (sanitary control)system

EU is preparing a legislation requiringimporting countries to have a qualitycontrol system similar to HACCP

ISO 9002 (working methods) andEuregap (fresh fruits) in the first place,are major assets for the importers

Buyers requirements

To share responsibility, most EUimporters require their suppliers to getthe same certifications as themselves

Major firms audit the factories they areworking with

Accreditation process takes a couple ofmonths (up to 3 years)


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Global Market

Dried fruits and nuts

Annual world production for

selected products in thousand tons

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Pine nuts

Dried apricots

Dried figs

Pistachios

Raisins

Walnut

AlmondsSources: USDA, FAO 2003

4 main producers (US, Iran,Turkey, China) account for twothirds of the production

With estimated 91,000 tons out of4.8 million tons, Afghanistansvolume share of world productionis about 2%, down from about 10%in the 70s

Main Afghan products are almond, walnut,

raisin and pistachioThe global export market for these products isestimated at $2.2 Billion for 1.3 million tonstraded yearly

Afghanistan could potentially be a significant player on the dried fruits market

Production shares of the selected productsby cou ntry of origin

32%

15%

11%7%

4%

3%

2%

2%

1%

21%

31%

2%

US

Iran

Turkey

China

Spain

Other Middle East

Afghanistan

Italy

Greece

North Africa

Others


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Global Market

Organic products

Definition

Food grown without the use of synthetic chemicalssuch as artificial fertilizers, pesticides, growth

regulatorsOrganic labels

EU organic logo, California Organic Food Act 1990,French AB, German Demeter

Drivers

Argument over GMOs

Environmental concerns Health awareness (wellbeing)

Government and retailer support

Organic market values (US$ Million)

2000

8,000

2,128

986

985

978

1,887

US

Germany

UK

France

Italy

Other

Opportunities

Western countries

20% growth forecast for the next fewyears

Consumers may be willing to pay 20%more than conventional products

Traditional farming in Afghanistan isclose to organic

Constraints

Certification (quality control)

Optimization of marketing channels

Competition with developing countries,China and India in particular

Competition with local producers =>need for logistic costs optimization

Organic food is a fast growing trend in western countries

Total: US$ 15 billion


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Global Market

Fairtrade

Definition

Products guaranteeing fair and sustainable conditions for theproducers and their environment.

Fairtrade labelE.g. Max Havelaars certification for a growing list of products

Drivers

Consumers accept to pay 5-15% more if the products are producedproperly

Growing interest for the concepts of sustainable development

Support of major retailers

Opportunities

Strong growth in Western countries

Max Havelaar: sales of fruit juices grew40% a year for the last 3 years

(US$ 8 million revenue in 2003)Focus on small production units

Certification for dried fruits and nutsunder study by FLO (Fairtrade LabellingOrganization)

Afghanistan brand in the context of

reconstruction

Constraints

Certification covers only some products

Introducing new products take time

Need for cooperative structures

Emerging market for dried fruits

Afghanistan can be positioned as a strong brand in Fairtrade market

for juices and dried products

Coffee with Fairtrade label


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Opportunities

Open regional markets

Strong potential for dried fruits

Differentiation in quality products

Growing organic and fairtrademarkets

Import substitution

Constraints

Not part of a major tradingregion

No counter-season opportunitywith major trading regions

Certification requirements to goto western markets

Global Market

Position of Afghanistan in Global Markets

Afghanistan has a potential for selected crops but needs to specialize as it is not partof major trading regions


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Agenda


Global Market


Production conditions

Post-harvesting conditions

Value Chains

Internal Flow

Import/Exports


Next Phase


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Production and Marketing

What horticulture crops are Afghan farmers cultivating?

Grape44%

Melon/Water melon(irrigated)

19%

Almond

9%

Walnut

2%

Mulberry

12%

Apricot

5%

Pomegranate

2%Apple

5%

Peach

1%Plum

1%

70%

FRUITS

30%

VEGETABLES

5 top fruits andvegetables represent ~90% of area cultivated

Relatively lowhorticulture cropdiversification

Potato

52%

Onion15%

Tomato

12%

Carrot

5%

Okra

4%

Cauliflower

1%

Spinach

1%

Turnip

3%

Eggplant

3%

Cucumber

3%

Others

1%

Source: Analysis of FAO 1997 Agriculture survey and

FAO2002-2003 Winter Agriculture Survey databases. 2.05 ha irrigated with first crop, 0.35 irrigated withsecond crop and 0.21 ha irrigated horticulture crops.

Horticulture cropsrepresent 10% of totalirrigated area


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Grape

0

20000

40000

60000

80000

1978 1996 2003

Hectares


Production trends

Despite war, drought and global market consolidation,land allocated to fruit crops has slightly increased over the past 25 years

DECREASE SINCE 1978INCREASE SINCE 1978

Source: FAO, Landcover data, 1972 & 1993and analysis of FAO 1978 and 1996

Agriculture survey, and FAO 2002-2003Winter Agriculture Survey

OVERALL SLIGHTINCREASE IN THE PAST 25

YEARS

Pomegranate

0

2000

4000

6000

8000

1978 1996 2003

H

ectares

Apple

0

2000

4000

6000

8000

1978 1996 2003

Hectares

Apricot

0

4000

8000

12000

16000

20000

1978 1996 2003

H

ectares

Walnut

0

1000

2000

3000

4000

5000

1978 1996 2003

H

ectares

Almond

0

4000

8000

12000

16000

20000

1978 1996 2003

H

ectares

But a significant decreasesince 1996 due to the

drought

Orchard

0

30000

60000

90000

120000

1972 1996 2003

H

a

All Orchard


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Conditions of production

Low productivity and quality

Traditional/extensive production system

Only few intensive commercial orchardsNo uniformity of varieties

Some species are propagated without grafting stone fruits, walnuts, some almonds

Only few commercial nurseries

Poor farming practices Excessive irrigation (vineyards/pomefruits

orchards are flooded every 10-15 days)

Lack of pruning (pomegranate in Kandahar) orincorrect pruning (apple in Wardak)

Deep planting (burring rootstock) resulting in

delayed bearing Vine trained on the soil or on mud trellises

resulting in high incidence of diseases andpresence of dirt/dust

Incorrect orchard floor management

No or poor pest (and virus) management

Production practices did not change over the past 25 years - Lack of know-how onhorticulture commercial cultivation practices

Sari Pul, Sozma Qala, 16 May 2003

Herat, Injil 29 May 2003


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Extensive production system

Almond trees

Apricot trees

Wheat intercropped

Ghorband River

Almond trees intercropped with wheat. Trees are damaged by therepeated passages of ox-plough which results in very low productivity

Most of the orchards are intercropped with cereal and have low productivity

Ghorband valley, 5 June 2003


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The few existing intensive production systems also have low productivity

Apple orchards un-pruned and showing excessive growth andlittle production as seedlings have been planted too deep (below

grafting point) and as a result trees are now on their own root

Wardak, Jeghatu district, June 1994


Intensive production system


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Yield comparison

9 to 11Turkey

8.50Afghanistan

4.14Pakistan

5.30Turk-Uzb-Taj

9.51Iran

11.19China

16.65United States of America

24.49India

Yield (Mt/Ha)Grapes

0.67Turk-Uzb-Taj

0.91Iran

1.40Afghanistan

2.11Turkey

2.20China

2.47Pakistan


Yield (Mt/Ha)Almond

14.10Afghanistan

14.67China

14.79Turk-Uzb-Taj

16.52Pakistan

18.49India

21.00Iran

25.99Turkey


Yield (Mt/Ha)Potatoes

23.14Turk-Uzb-Taj

9.83Pakistan

10.70Afghanistan

14.81India

25.61China

28.22Iran

40.11Turkey


Yield (Mt/Ha)Tomatoes

12.30Afghanistan

12.75India

13.14Turk-Uzb-Taj

20.90Iran

21.00Pakistan


30.36Turkey

32.90China

Mt/HaWatermelon

10.50Afghanistan

14.58India

17.70Pakistan

18.74China

19.58Turkey

24.78Turk-Uzb-Taj

25.00Iran


Yield (Mt/Ha)Carrots

Horticulture crop yields of Afghanistan are low but close to its neighbours

Source:www.fao.org


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Packaging and processing

Packaging/processing practices did not change over the past 25 years

Limited processing capacity

Raisins factories damaged or not maintained

9 factories out of 27 constructed before the war areoperational

Equipment and process is outdated

Processing factories are often rented to traders(owners do not market themselves)

Olive oil factory in Jalalabad

Packaging in wooden crates of inappropriate sizeresults in important losses of products

Wooden crates are unfit for international exports(except Pakistan and India)

No cold chain to transport fresh horticultureproducts

Reduced quality and important losses

Mazar-e Sharif, 1 June 2004



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Outdated processing plants

Afghanistan, Raisin processing plant, June 2004

Turkey, Elbiscan laser sorting/scanning/

reinspection system

Raisin processing plants do not meet certification

requirements for European markets


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Products quality

APPEARANCE

Irregular size (no calibrating), color (diverse

varieties except for grapes and apple) andmaturity (fields harvested at once)

Dusty

Often bruised (packaging)

Often marked by pests and diseases (stone

fruits sometimes have worms inside)

TASTE

Good in general but it varies from one

fruit/vegetable to the otherUnpleasant surprises (bitter almonds in a lotof sweet almonds)

CONSERVATION

Short shelf life as fruits/vegetables areharvested at suboptimal time (potatoes arenot defoliated before harvest, too lateirrigation on onions, apple harvested too lateand all at once, mechanical damages duringpackaging reduce conservation, etc..)

Inadequate storage practices (insufficientventilation in stores)

Quality standards of Afghan horticulture products can improve



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Products quality Food safety

Fruits and vegetables are washed ormoistured with unsafe water(no water

supply in the wholesale markets)Presence of contaminants in urbandustfound in horticulture products (openlatrines in every city and wholesalemarkets have no facilities)

Most of horticulture products areproduced without pesticidesbut whenchemicals are used, there is nostandard/control on residues

Raisin processing facilities are below

international requirementsin term ofhygiene and food safety

Lack of personnel dealing with foodsafety issues

Food safety concern over Afghan horticulture products

Parwan, Ghorband, 4 June 2003


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Marketing conditions Mechanisms

The marketing sector is organized infragmented vertical social networks

which hamper optimization of marketopportunities:

The rationales for wholesalers and traders tomarket horticulture products to one destinationrather than another is largely determined bypresence of solidarity networks (qawm) members

The fragmentation of the Afghan societyhampers the establishment of contractual relationsoutside of social networks (qawm) betweenproducers and traders for large volumes of goodquality products

Social networks and free markets (open fairs) command the marketing environment

Horticulture products are sold in openfairs which promotes low prices rather

quality:Government has little influence on market prices

and quality regulation

Wholesale markets are highly speculativeanddepends on daily available trade information suchas number of buyers/sellers, trade agreements,etc

Market days in districts are coordinated withmarket days in provinces which allows marketingof farmers products in remote area, but the numberof intermediaries increases

Example volatility of market prices; Tomato price in Jalalabad wholesale market:

22nd May 2004 = 50 Afs/seer

23rd May 2004 = 90 Afs/seer

24th May 2004 = 60 Afs/seer


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Marketing conditions Mechanisms

Wholesale markets work as open fairs but also through social networks

Early morning in the wholesale market of Jalalabad. Trucks fromPakistan have been ordered through Afghan trading partners inPeshawar and products are sold to retailers on a open fair basis

Farmers negotiating sellingprices for their cucumbers

Retailers loading tomatoespurchased from traders

Jalalabad, 26 May 2004


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Marketing conditions - Actors

Existing horticulture markets focus is on prices and not quality

BENCHMARK: WORLD MARKETS

Large retailer chains sometimes control 20 to 60% of the horticulture market of one

country (e.g. Carrefour, Auchan, Migros)

Their focus is on quality:1. Food safety2. Appearance3. Taste

FROM FARMERS TO WHOLESALERS

Large number of actors from the production to the marketing which results in fierce

competition on prices but do not promote quality:

There are approximately 1 million farms in Afghanistan out of which approximately 0.6million farmers grow horticulture crops

There are more than 2,000 wholesalersfor horticulture products. The wholesalers arelocated in the 5 main wholesale markets (Kabul, Kandahar, Mazar, Jalalabad and Herat)and smaller wholesale markets in the 34 provinces

There are several thousands middle men liaising the many farmers and wholesalers


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Quality grading is done by retailers at the very end of the marketing chain

RETAILERS

The number of retailers is unknown but amounts to severalthousand people

Producers and retailers do not know each other

Retailers for fresh products have no facilities and often sell theirproducts on hand pulled carts

Retailers have an important share of the value chain (~ 10 %)as sorting products by quality is done at their level (last level ofthe marketing chain) and they bear the risks of spoiled unsoldproducts

Parwan, Charikar, 25 June 2004

BENCHMARK: WORLDMARKETS

Large retailers have directcontractual agreementswith producers, whichestablishes qualityrequirements for horticulture

products


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ACTORS STRATEGY

In the past decades, the strategy adoptedby actors at all level of the horticulture

sector was to limit risks through the choiceof temporary solutions

(extensive intercropped orchards, focus on

price instead of quality, interest in shortterm trade opportunities, limited investment

in factories, etc )

The current environment is moreconducive to private investment for large

processing facilities

TRADERS

Limited number of operating importersand exporters:

The import/export traders are located inthe 5 major cities (Kabul, Herat, Mazar-eSharif, Kandahar and Jalalabad) in whichlocal powers influence tradingenvironment

Lack of information on foreign markets(world wide prices, quality requirements,contract)

Lack of communication facilities untilrecently


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Marketing chains 4 types of products

Trading Partner in

Pakistan

Fresh products

Long andmedium shelf life

Fresh products

Short shelf life

Dried Fruits Nuts and wild Nuts

Onion, Potato,Carrot, Grape,Apple, melon

Stone fruit,tomato, okraegg-plants

Farmers sellstheir crop in thefield (sometime

in advance)

Retailers

Farmers bringproducts in the

wholesale marketduring harvest

CommissionAgent

Retailers

Sun dried, greenand black raisin,

apricot, fig

Farmers bringproducts in the

wholesale marketwhen required

Wholesaler

Trader

Raisinprocessing/

cleaning company

Trading Partner in

foreign country

Retailers

Almond, walnutand pistachio,

pine nut

Farmers sell toMiddle men in

the villages

Wholesaler

Trader Retailers

Trading Partner in

foreign country

Trader Middlemen


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36

350

5010

2550

485

0

100

200

300

400

500

Product(farmgate price) Packaging Transportation Wholesalermargin Retailer margin Final sales price


Value chain Grape

Example: Shamali grape in Kabul (retail)

US$ / ton

The value chain of grape shows a number of Afghan actors with low added value


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Value chain - Grape

0

200

400

600

800

1000

Price (US$/ton)

Shamali Grape to

Kabul

Shamali Grape to

Peshawar

Shamali Grape to

Dubai

Retailer Margin

Foreign Partner Margin

Wholesaler Margin

Transport

Packaging

Product

When comparing thevalue chain ofShomali grapesacross severalmarkets (Kabul,Peshawar, Dubai), itis easy to notice theinfluence of logistics

on the price ofexported fruits

Logistic costsrepresentapproximately 125%

of the farm-gate pricewhen exported toDubai

P d i d M k i


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38

930

6055

150

30252010

580

0

200

400

600

800

Produ

ct(fa

rmgate

price

)

Tran

sportat

ion

Middlem

an

Facto

ry

Trad

er

Transpo

rtatio

ntoRu

ssia

Pa

rtner

feeinRu

ssia

Who

lesale

rmargin

Wholes

aleprice

inRus

sia


Value chain Raisin

Raisin processing adds relatively small value,but makes logistics less of an issue

Example: sun-dried Shamali raisin processed in Kabul and exported to Russia

US$ / ton

P d ti d M k ti


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39


Value chain Fresh tomato vs. tomato paste

Total:US$ 390 / ton

Total:US$ 910 / ton

The value chain of processed tomatoes in Pakistan shows high value added

300

90

210

263

175

263

Fresh Tomato

(Kabul)

Processed tomato

(Lahore)

Fresh and Processed Products

Value Chain (in US$ per ton)

Distribution

Processor's margin

Process

Product

ToP d ti d M k ti g


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40

# #

#

#

%

=

= = ==

=

#

#

##

#

#

#

#

Mery

Quetta

Meshed

Zahedan

Bukhara Dushanbe

Peshawar

Islamabad

Kandahar

Mazari Sharif

JalalabadKABUL

Hirat

Trading Road Map

N

EW

S

100 0 100 200 Kilometers

# Main Trading Centers% Kabul

# Cities Neighbouring Afghanistan

Secondary Road to International Borders

Ring-road & Tarmac Road

= Major Road Passes

Legend

Source: AIMS vectors adapted by ALTAI

ToLaho

re/India

ToKarachi

ToLahore/India

ToB

andarCh

ab

ah

ar

To Teheran

To Bandar Abbas

ToAskhabad

oRussia

To

Chin

a

Islam Qala

Turghundi

Aqeena HairatanSherkhanAi Khanum

Ishkashim

Turkham

Spin BoldakZerenj




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41

West

South-West

North

South

North-East

East

West-Central


Horticulture products trade routes

Trade between Wholesale Centers and Provinces

Trade between Main Wholesale Centers

International Trade

KABUL

~ 1,600 Wholesalers0.5 to 1 Million MT Trade

JALALABAD

~ 70 Wholesalers0.02 Million MT Trade

MAZAR-E SHARIF

~ 260 Wholesalers0.2 to 0.3 Million MT Trade

HERAT

~ 240 Wholesalers

0.1 to 0.2 Million MT Trade

5 trading centers and main wholesale markets Kabul is the main hub

KANDAHAR

~ 300 Wholesalers

0.2 to 0.3 Million MT Trade



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42


Import / Export Fresh fruits

West

South-West

North

South

North-East

East

West-CentralExport : ~ 50,000 MT

Import : ~ 3,000 MTImport:10,000MT

Grape, Apple,Melon, Apricot,

Pomegranate

Watermelon,

Apple & Stone

fruits

Pakistan is the main trading partner for fresh fruits (temperate fruits exports)

Apple

Source: Information gathered at the custom office of each border pointsImports/export data from Hamal 2003 to Hut 2004

Grape, Melon,

Pomegranate



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43


Import / Export Fresh vegetables

West

South-West

North

South

North-East

East

West-Central

Export : 66,000 MT

Import : 74,000 MT

Import:12,000MT

Export:~

3,0

00MT

Imp

ort:~

9,0

00MT

Exp

ort:2

00MT

Potato &

Onion

Onion, Potato

& Tomato

Potato, Onion

& Tomato

Potato

&Onion

Pakistan is the main trading partner for fresh fruits (counter-season trading)

COLD STORAGE

There is no large coldstorage in Pakistan for re-export of vegetables inAfghanistan

Afghanistan and Pakistanbenefit from mutual counter-

season market opportunities

Potato, Onion,Tomato

Potato


Onion, Potato

& Tomato



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44


Import / Export Dried fruits and nuts

West

South-West

North

South

North-East

East

West-CentralExport : ~15,000 MT (transit in Iran)

Export : ~ 7,000 MT

Export:~9,0

00MT

Exp

ort:~

5,5

00MT

Import:~100MT

Export:~1,000MT

Imp

ort:~100

MT

Raisin, Dried Apricot

& Cherry

Raisin

Raisin

Raisin, Pistachio,Almond, Walnut

Raisin

Afghanistan exports dried fruits through CIS countries, Iran and Pakistanto markets in Russian, India and the Middle East


Raisin, Dried Apricot

& Almond



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45


Import / Export Processed products

West

South-West

North

South

North-East

East

West-Central

Import:30,000MT

Export : ~ 1,000 MT

Import : ~ 12,000 MT

Import:~3,000MT

Imp

ort:~

100

MT

Impo

rt:~100MT

Fruit juices Iranian TomatoSauce

IranianFruitjuices&TomatoSauce

IranianFruitjuices

&TomatoSauce

Fruit juices

Afghanistan imports all processed products from Iran and Pakistan


Fruit juices



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46


Export channels

Sea freight Rail transportation

Road transportation Air transportation

Air transportation:

Dubai : US$ 350 / ton

Frankfurt : US$ 1,000 / ton

Moscow : US$ 1,000 / ton

Non-air transportation:

Dubai : US$ 100 / ton 10 days

Moscow : US$ 140 to 200 / ton 20 days

Karachi : US$ 100 to 150 / ton 4 weeks

Due to its landlocked situation,

logistics is a main hurdle for Afghan exports and horticultural markets

DUBAI KARACHI

BANDARABBAS

TO MOSCOW

TO FRANKFURT

KABUL

TERMEZ



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47


Logistics (Road transportation)

Less than 50 refrigerated trucks are available around the country

Up to 200% price differences on prices applied by various transportersAbsence of insurance system

Difficulty to optimize return trips

Road transportation costs are higher than Europes despite lower labor andoil costs

Afghanistan faces severe road transportation costs

Average national transportation

cost comparison

for 1 ton and 1 km

Europe Afghanistan

$ 0.04 - 0.05

$ 0.05 - 0.10



48/121

48

g

Logistics (Air transportation)

Ariana Afghan Airlines is the cheapest alternative (US$ 350 a ton to

Dubai)The level of quality of service offered by Ariana is unadapted to freshfruits transportation:

Poor storage and sanitary conditions

Cancellations and delays

Cargo companies using DHL flights and Azal offer better quality ofservice. Yet the prices are prohibitive for fruits and vegetables

Azal:

Kabul Dubai $2000 / ton

Kabul Moscow: $1850 / ton

Air transportation does not offer satisfying costs and sanitary conditions



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49

g

Key findings

The horticulture sector did notimprove but did not collapse in thepast 25 years

Given its climatic potential forhorticulture, Afghanistan has anunder-developed horticulture sector

The sector is gripped by structuralconstraints from production to

marketing of the productsAll actors in the marketing chain ofhorticulture products have adoptedstrategies to limit risks in the pastdecade

Logistic constraints in a landlockedcountry

Political insecurity is a major threat tochanges

Ways to develop the horticulturesector through the private sector:

Wealthier farmers/land ownersare in the best position to take

investment risks in intensivehorticulture crops commercial orchards

Potential Afghan investorsmay need to have sufficient

control over the wholemarketing chain:

production (commercial crops)

processing (industrial plants)

distribution (marketingnetworks)

Risks have to be shared withpublic funds due to the lack ofinfrastructure


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50

Agenda


Global Market



Next Phase



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51

Population and GDP trends

Population Trends Afghanistan

15

22

14

0

5

10

15

20

25

1978 1990 2002

MillionInhabitants

Population Trends Pakistan - India

76 111 150

661

846

1'050

0

200

400

600

800

1'000

1'200

1978 1990 2002

Millioninhabitants

Demand for horticulture products is driven by increased population in the past 25years and recent GDP increase per inhabitants

Nearly half a billion population increase in Indiaand Pakistan over the past 25 years

8 millions population increase over the past 25years in Afghanistan

Kabul, 31 December 2003

AFGHANISTAN : 20% GDP increase in 1383/2003 (174 $/inhabitant)

Pakistan

India



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Criteria for selection of opportunities

Market size

Price opportunities Quality requirements

Crop calendar

Logistic constraints

Volume of existing production

Potential Analysis of Afghanistan Regions

CRITERIA

Production Value in Million US$

Marketability

Comparative advantages ofAfghanistan regions

OUTPUT



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53

AFGHANISTAN

Price 350 $/MT

Example: Grape

IRAN

2.53 Million MT

Price: 300-450 $/MTExport: Yes

PAKISTAN

0.05 Million MTPrice: 483 $/MT

Export: No

INDIA

1.2 Million MT

Price: 176 $/MTExport: Yes

US6.1 Million MT


TURK-UZB-TAJ


Exports: Yes

CHINA

No Data MTPrice: 223 $/MT

Export: Yes

TURKEY

3.85 Million MT




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54

AFGHANISTAN

Price 550 $/MT

Example: Walnut

IRAN

160,000 MTPrice: 1200 $/MT

Export: Yes

PAKISTAN

20,000 MT

Price: 810 $/MTExport: No

INDIA

31,000 MTPrice: 380 $/MTExport: Yes

TURKM-UZBEK-TAJIK

5,000 MTPrice: 1500 $/MT

Export: YesTURKEY

125,000 MTPrice: 1100 $/MT

Export: No

US

295,000 MTPrice: 1100 $/MT

Export: Yes

CHINA

360,000 MTPrice: 720 $/MT

Export: Yes



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55

AFGHANISTAN

Price 250 $/MT

Example: Tomato

IRAN

3 Million MTPrice: 345 $/MT

Export: Yes

PAKISTAN


Export: No

INDIA7.4 Million MT


TURKM-UZBEK-TAJIK


Export: YesTURKEY


Export: Yes

US


Export: Yes

CHINA


Export: Yes


E l C l d O i


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Example: Crop calendar - Onion

Month Dalwa Hut Hamal Saur Jawza Saratan Asad Sunbula Mizan Aqrab Qaus Jadi

Jan Feb 21st Mar Apr May Jun Jul Aug Sept Oct Nov Dec

KABUL

HELMAND

JALALABAD

NORTHERN AFGH

PAKISTAN

Afs/seer 60 40 50 50 60

KABUL

JALALABAD

PAKISTAN

Afs/seer 55-60 40 50 50 55-60

BAGHLAN

NAHRIN

JALALABADPAKISTAN

UZBEKISTAN

Afs/seer 30 50-60 50-60 20 25-30

M

AZAR

KABUL

JAL

Production peak in PakLow Prices

Low Production in PakPrices Increase

RemoteM

arket

Markets

integratedwithPak

istan

Low Production in PakHigher Prices

Opportunity for improvement of storage facilities


57/121


Example: Crop calendar Apple


58/121

58

Example: Crop calendar - Apple

Month Dalwa Hut Hamal Saur Jawza Saratan Asad Sunbula Miza Aqrab Qaus Jadi

Jan Feb 21st Mar Apr May Jun Jul Aug Sept Oct Nov Dec

WARDAK

LOGAR

PAKISTAN

Afs/seer 170 200 150 150 150 160

WARDAK

PAKISTAN

Afs/seer 200 200 150 150 150 160

MAZAR MAZAR

WARDAK

PAKISTAN

Afs/seer 320 300 210 210 280

KABUL

JA

L

M

AZAR

Apple imported from cold storageIn Pakistan (mainly Quetta)

Prices decrease as apple quality deterioratesin late spring

Opportunity for establishing cold storage facilities

Rem

oteMarket

Ma

rketsintegrated

withPakistan


Global markets Western markets


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59

US, EU and Russia Markets

Grapes

Sundried Kishmish

Green Kishmish

Almond

Apricot

Melon/w-melon

Onion

Tomato

Carrot

Pistachio

Peach

Walnut

PotatoApple

Okra

Pomegranate

Plum

0

50

100

0 60 120

Production Value Million US$

Market

ability

Global markets - Western markets

Increased quantity of dried fruits/nuts exports: Improve quality of raw material, processing

and marketing (trading links need to bedeveloped)

Challenges:

Quality, certification, traceability Competitors such as Turkey and Iran Border contraints


Regional markets Middle East


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Middle East Markets

Grapes

Sundried Kishmish

Green Kishmish

Almond

Apricot

Melon/w-melonOnion

Tomato

Carrot

Pistachio

Peach

Walnut

Potato

Apple

Okra

Pomegranate

Plum

0

50

100

0 60 120


Market

ability

Increase quantity of dried fruits and some fresh products:: Improve processing and marketing (trading links needs

to be developed)

Challenges: Competitors such as Turkey and Iran

Regional markets Middle East


Regional markets Pakistan & India


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Pakistan & India Markets

Grapes

Sundried Kishmish

Green Kishmish

Almond

Apricot

Melon/w-melon

OnionTomato

Carrot

Pistachio

Peach

Walnut

Potato

Apple

Okra

Pomegranate

Plum

0

50

100

0 60 120


Marketability

Regional markets Pakistan & India

Optimization of regional exchange for a cluster of products: Counter-season vegetable products Excellency in temperate climate fruits

Challenges: Logistic for India (cold chain, road, border formalities) Maintaining trading relation with both partners


Local market Afghanistan


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Afghanistan Markets

GrapesSundried Kishmish

Green Kishmish

Almond

Apricot

Melon/w-melon

Onion

Tomato

Carrot

Pistachio

Peach

Walnut

Blood orange

PersimonPotato

Apple

Okra

Pomegranate

Plum

0

50

100

0 60 120


Marketability

Local market Afghanistan

Increase availability on local market: Consolidation of the retail sector Extension of production period (new varieties, plastic tunnels) Substitution to import for stone fruits, oranges, persimmons Improve storage capacity

Challenges: Security Political economy


Processed products


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Processed products

Processed products are a sizeable import market

Processed fruits and vegetables

represent around 1.4 to 2.5 billionAfghani (US$ 28-60 million)market (estimation)

Juices and tomato paste are thebiggest share (75% of trade)

No food processing industry in Afghanistan today

Most processed products are imported fromneighboring countries (Pakistan, Iran)

Market size of selected transformed

products in Afghanistan in Million Afs

Juices Tomato

paste

Jams Pickles Potato

chips

800-1200

400-800

200-40030-100 20-60


Short-list


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Short list

GLOBAL MARKET

REGIONAL AND LOCAL

Dried Fruits and Nuts

Fresh Products

Processed Products

Marketing Improvement

1. Raisins and apricot processing andpackaging

3. Commercial horticulture crops for stonefruits, pomegranate, blood orange,

persimmon, walnuts

4. Storage facilities for temperate fruits andvegetables (apple, grape, tomato)

6. Processing plants for fruits juices, fruitsconcentrates, tomato sauce and potato chips

7. Commercial horticulture crops forprocessed products (juices, )

9. Consolidation of the retail sector (throughthe establishment of super markets)

8. Plastic/carton plant for production of boxesfor fruits packaging

5. Plastic tunnels to extend availability ofvegetable (tomato, cucumber, okra )

2. Fair trade and Organic


Quality products - Sundried raisins


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y p

About 560,000 tons of sundried raisins are traded yearly (estimate)

Most sundried raisins are exported to western countries to be used in the bakingindustry (80% of use in Europe)

More than taste, our first concern is the cleanliness of the raisin, Alexis Sumar,Voicevals CEO

99.9% of the raisins come from Turkey () Their plants are equipped with Elbiscan

lasers.There will be no purchases from Afghanistan is there is no quality AND priceadvantage, Purchasing Manager of a leading international agribusiness group

Raisin export volume shares in 2001

33%

18%

16%9%

6%

5%

4%

3%

18%

6%

Turkey

Iran

US

Western Europ

Chile

Afghanistan

South Africa

Greece

Others

Raisin import volume shares 2001

18%

12%9%

8%

6%

4%4%

39%United Kingdom

Germany

Russia

Netherlands

CanadaFrance

Italy

Others


Quality products Dried fruits processing factory


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y p p g y

Opportunities

Possibility of vertical control of theproduct chain

Modern plants at accessible prices arenow available to target global markets

Investments on existing factories

Growing organic and fairtrade markets

Afghanistan as a brand

Constraints

Volume/Price driven markets

Russia tempted to move towards higherquality standards

Threats of Uzbekistan and Tadjikistan(exports multiplied by 4 since 1997)

Certification requirements for westernmarkets

Strengths

Variety potential

Existing sizeable production

Ideal climatic conditions for drying

Weaknesses

Afghan raisins needs 2 to 3 washings

Production techniques not satisfying,high investment needed to match

competition/requirementsOutdated processing facilities

Know-how is mostly geared toward theRussian market


Commercial crops


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Strengths

Accessible to medium and large farmers/landlords

Afghans are habile farmers

Farmers are interested in diversifying theircrop

Regulate supply of horticultural products

Weaknesses

No research in-situ in commercialhorticulture crops

Lack of cultivation practices knowledge forcommercial crops

Identification of interested farmers ready totake risks

Fragmented market distribution chains

Opportunities

Increase productivity

IF Hope in Jalalabad produces 2 million fruittrees seedlings for which commercial cropscould be established

Experience and research applicable inneighboring countries (Iran, Pakistan, CIScountries) and other dry countries

Constraints

Security

Irrigation water insecurity (drought)

Speculative market


Plastic tunnels


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Strengths

Accessible to small farmers (vulnerablepopulation groups)

Not expensive to establish

Seasonality of horticulture products

Weaknesses

Availability of good quality material isuncertain

Identification of interested farmers ready totake risks

Opportunities

Increase of vegetable prices at the end ofthe growing season

Experience in Vietnam

Constraints

Security

Early and late frost

Speculative market


Fruit juice market


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69

Fruit juices are a growing mass-market product in Afghanistan

Iranian Fruit juices

Sodas

Water

Cool box for fresh drinks

Ice



Processed horticulture products - Juices


70/121

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The market of fruits juices in Afghanistan is estimated at between 800 and 1,200 Million Afsfor around 30-45 Million Liters with a yearly growth of around 15%

Currently, all the fruit juices of Afghanistan are imported. Mainly from Iran (47%), Pakistan(41%), UAE (8%), Uzbekistan and Turkey

At least 27 brands are present on the Afghan market. 6 of them hold 80% of the market

The increasing fruit juices market offers high opportunities for Afghanistan

Opportunities

Local interest for juices

Growth potential with income per capita,urban population and consumptiontrends

Potential advantage for a national brand

Regional demand for fruits concentratesPossibility to combine investment with abottling factory

Constraints

Increasingly competitive marketbetween brands available in Afghanistan

Iran is positioned in sellingpomegranate, grape and apricotconcentrates

Very competitive prices of fruits inPakistan where processing is located

Need reliable supply from commercialorchards


Processed horticulture products Tomato


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Tomato paste, sauce, ketchup

The market of processed tomato in Afghanistan is estimated

at 400 to 800 million AfsCurrently most products are imported from Iran (and Pakistanto a lesser extent)

Tomato processing is another opportunity to explore

Opportunities

Growing demandValuable use of varietiesof tomatoes that are notsuitable for transports

Constraints

Low quality, pricecompetitiveness of currentproduction

Raw material is cheaper inneighboring countries (e.g.tomatoes are about 20%

cheaper in Pakistan thanAfghanistan)

Little opportunity for export


Plastic/carton industry for fruit packaging


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72

Strengths

Plastic/carton Industry uses well knowntechnology

Increase quality and hygiene of horticultureproduct

Weaknesses

Arguably less environment friendly thanwooden crates

New industry in the country

Opportunities

Increased demand for strong and cleanpackaging implements with thesophistication of horticulture markets

Facilitates access for Afghan horticulturalproduct to foreign/international markets

Reduce losses of horticultural products

Demand for storage boxes for non-horticultural products traded in the marketand at home

Experiences in other countries

Constraints

Security is a challenge for theestablishment of a factory

Electricity supply

Acceptability of new packages to traders inAfghanistan and abroad


Consolidation of the retail sector


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73

Strengths

Scale economy (price) and strongerbargaining power with producers/importers

Attract consumers with better qualityproducts at low prices

Contractual agreements between farmersand retailers which allows focus on quality

Comparatively lower risks for investor thanhigh tech processing plants

Weaknesses

Conflicts with retailers and importers -Losses of income for thousands of retailers

Lack of existing facilities (cold chain,logistic)

Opportunities

Sophisticated competition does not exist yet

Increasing urban population and GDP

Experiences in other countriesShopping centers being constructed invarious parts of the country

Constraints

Security is a challenge for changes in themarketing sector

Reliability of the supply chain


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76

Maps - Cultivated area, Production and Farm-gate Prices by

fresh Horticulture Product

ANNEX I

Map - Cultivated area, Production and Prices

Methodology and Legends


77/121

77

Legends :

US: United States of America

TURK-UZB-TAJ: Turkmenistan, Tajikistanand Uzbekistan

Circles: visual representation of thenational production

Production: average production in thepast 3 years

Price: Farm-gate price in US$/MT

Exports: Yes = more than 1000 MT: No =less than 1000 MT

Orange color: Countries with farm gateprices lower than Afghanistan

Blue color: Countries with farm gateprices higher than Afghanistan

Methodology :

Production Data for Afghanistan

Analysis of the FAO 2002-2003Agriculture Survey* database

Review of yield reported in the FAO 1996Agriculture survey

Production data were validated in the fieldduring the market assessment in the

major wholesale markets

Data for Other Countries

Extracted from FAO statistical database

atwww.fao.org

Maletta Hector and Favre Raphy, Winter Agriculture Survey. A Statistical Report . Approximately 5,000 farmers wereinterviewed in 30 provinces. This is the only recent agriculture survey in Afghanistan for which a sampling frame wasdeveloped for statistical analysis of survey data


Grape


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AFGHANISTAN

Price 350 $/MT

IRAN

2.53 Million MT

Price: 300-450 $/MTExport: Yes

PAKISTAN


Export: No

INDIA


Export: Yes

US6.1 Million MT


TURK-UZB-TAJ0.8 Million MT

Price: 176 $/MTExports: Yes

CHINA

No Data MTPrice: 223 $/MT

Export: Yes

TURKEY


Export: Yes


Almond

TURK UZB TAJ


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79

AFGHANISTAN

Price 2200 $/MT

IRAN

105,000 MT

Price: 2,700 $/MTExport: Yes

PAKISTAN

24,000 MT

Price: 1,300 $/MTExport: No

INDIA

0 MT

TURK-UZB-TAJ

7,000 MTPrice: 2,900 $/MT

Export: NoTURKEY

50,000 MTPrice: 2800 $/MT

Export:

US

800,000 MTPrice: 2,006 $/MT

Export:

CHINA

26,000 MTPrice: No data

Export: No


Irrigated Melon & Watermelon

TURK-UZB-TAJ


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80

AFGHANISTAN

60 $/MT

IRAN

2 Million MT


PAKISTAN0.4 Million MTPrice: 70 $/MT

Export: Yes

INDIA

0.3 MTPrice: 70 $/MT

Export: Yes

TURKEY


Export: Yes

US


Export: Yes

CHINA


Export: Yes

TURK-UZB-TAJ


Export: Yes


Apple

TURK-UZB-TAJ


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AFGHANISTAN

Price 295 $/MT

IRAN

2.36 Million MT


PAKISTAN


Export: Yes

INDIA


Export: Yes

TURK UZB TAJ


Export: YesTURKEY


Export: Yes

US


Export: Yes

CHINA


Export: Yes


Apricot

TURK-UZB-TAJ


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AFGHANISTAN

IRAN

284,000 MT

Price 200 $/MTExport: No

PAKISTAN

125,000 MTPrice: 173 $/MT

Export: No

INDIA

10,000 MT


TURK UZB TAJ

86,000 MTPrice: 210 $/MT

Export: YesTURKEY

580,000 MTPrice: 348 $/MT

Export: Yes

US

82,000 MTPrice: 353 $/MT

Export: Yes

CHINA

73,000 MTPrice: No data

Export: No

Price 380 $/kg


Pomegranate


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AFGHANISTAN

Price 85 $/MT

TURK-UZB-TAJ


Pistachio


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AFGHANISTAN

Price 5500 $/MT

1,000 MTPrice: 2,900 $/MT

Export: No

IRAN

310,000 MT

Price: 1,400 $/MTExport: Yes

PAKISTAN

200 MTExport: No

INDIA

0 MT

TURKEY

50,000 MTPrice: 2,500 $/MT

Export: Yes

US

82,000 MTPrice: 1,080 $/MT

Export:

CHINA

No Data MTPrice: 1,500 $/MT

Export: Yes


Walnut

TURKM-UZBEK-TAJIK


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AFGHANISTAN

Price 550 $/MT

IRAN

160,000 MT


PAKISTAN

20,000 MTPrice: 810 $/MT

Export: No

INDIA

31,000 MT


5,000 MTPrice: 1500 $/MT

Export: YesTURKEY

125,000 MTPrice: 1100 $/MT

Export: No

US

295,000 MTPrice: 1100 $/MT

Export: Yes

CHINA

360,000 MTPrice: 720 $/MT

Export: Yes


Peach

TURKM-UZBEK-TAJIK


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AFGHANISTAN

Price 320 $/MT

IRAN

385,000 MT


PAKISTAN

37,500 MTPrice: 195 $/MT

Export: No

INDIA

150,000 MTPrice: 175 $/MT

Export: No

65,000 MTPrice: 315 $/MT

Export: YesTURKEY

460,000 MTPrice: 315 $/MT

Export: Yes

US


Export: Yes

CHINA

4.4 million MTPrice: 150 $/MT

Export: Yes


Plum

TURKM-UZBEK-TAJIK


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AFGHANISTAN

Price 230 $/MT

IRAN

147,000 MT

Price 240 $/MTExport: No

PAKISTAN

63,000 MTPrice: 210 $/MT

Export: No

INDIA80,000 MT


120,000 MTPrice: 210 $/MT

Export: YesTURKEY

195,000 MTPrice: 270 $/MT

Export: Yes

US

725,000 MTPrice: 306 $/MT

Export: Yes

CHINA


Export: Yes


Potato

TURKM-UZBEK-TAJIK


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IRAN

3.55 Million MT


PAKISTAN


Export: Yes

INDIA24 Million MT



Export: YesTURKEY


Export: Yes

US


Export: Yes

CHINA

67 MTPrice: 70 $/MT

Export: Yes

AFGHANISTAN

Price 115 $/MT


Onion

TURKM-UZBEK-TAJIK


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89

AFGHANISTAN

Price 110 $/MT

IRAN

1.5 Million MT

Price 160 $/MTExport: Yes

PAKISTAN


Export: Yes

INDIA5 Million MT



Export: YesTURKEY


Export: Yes

US


Export: Yes

CHINA


Export: Yes


Tomato

TURKM-UZBEK-TAJIK


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90

AFGHANISTAN

Price 250 $/MT

IRAN

3 Million MT


PAKISTAN


Export: No

INDIA


Export: Yes


Export: YesTURKEY


Export: Yes

US


Export: Yes

CHINA


Export: Yes


Carrot

TURKM-UZBEK-TAJIK


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AFGHANISTAN

Price 270 $/MT

IRAN

40,000 MT

Price: No dataExport: No

PAKISTAN

195,000 MT


INDIA

350,000 MT

Price: No dataExport: No

105,000 MTPrice: 140 $/MT

Export: YesTURKEY

235,000 MTPrice: 190 $/MT

Export: Yes

US


Export: Yes

CHINA


Export: Yes


Okra


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Cucurbitaceous : Cucumber & Pumpkins


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Afghanistan Regions Horticulture Potential analysis

ANNEX II

Afghanistan Regions Potential Analysis

Regional Division

Existing agriculture data are presented following the FAO division of Afghanistan


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# #

#

#

%

West

South-West

North

South

North-East

East

Central

West-CentralKABUL

Mazari Sharif

Kandahar

JalalabadHirat

FAO Regional Divisions and Main Marketing Centers

N

EW

S

100 0 100 200 Kilometers

Regions (FAO division)

CentralEastNorthNorth-EastSouthSouth-WestWestWest-Central

# Main Marketing Centers% Capital

Regional Marketing Centers

Legend

Existing agriculture data are presented following the FAO division of AfghanistanGrouping of regions with similarities was made for the analysis

Central & South Regions

Production Potential Analysis

Plateau in mid/high elevation: between 1300 m absl in Kapisa (Tagao) and 2200 m in Wardak

and Gazni (Kabul 1800 m)


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( ) Counter-season with Pakistan and India low land

210 days free frost days in Kabul: 2 crops/year possible

Peshawar/Mardan plain:< 500 m absl

Shomali plain:>1500 m absl

Landsat-5 ThematicMapper scenes

acquired within one ortwo years of 1990 The

image mosaic wasspectrally enhanced

using EarthSatsLOCAL enhancement

technique. Thiscustom approach tocontrast adjustment

allows the preservationof spatial informationacross large areas ofextreme brightness

differences. Mosaicedand colour enhanced

by Earth SatelliteCorporation

(www.earthsat.com)

Hindus River



Opportunities Limitations


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+ High potential for temperate climate fruitproduction that Pakistan and India do not

produce in large volume such as grape, apple,stone fruits and pomegranate

+ Counter season with Pakistan for high qualityvegetable production

+ Provincial specialisation already exists: appleand potato in Wardak, vegetables in Kabul and

Parwan, raisins in Koh-e Daman andpomegranate in Tagao

+ Significant volume of production for potato,onion, tomato, apple, grape and raisin

+ Chinese-built Nahr-e Parwan canal may be

rehabilitated and this would enlarge theirrigation area in the Shomali plain

+ Monsoon in Khost/Paktia offers opportunities forlate autumn vegetable production

- Horticulture production potential partlydestroyed in the Shomali plain and overuse of table water in Ghazni with deepwells

- Absence of agriculture research in thepast 25 years and productionexperiences for fruits and vegetables inneighbouring countries do notnecessarily apply to the Central region

- Early frost (mid-October) may hamperproduction of late autumn vegetables

- Absence of vegetative cover (floormanagement) resulting from irrigationpractices in fruits and vine orchards

results in reduced quality freshproducts (dust)

- Low volume of production for stonefruits and most vegetables

pp


Market Potential Analysis



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+ Fairly good security for traders and investors inKabul

+ Good road network (cross-road between regions)

+ Kabul is the main marketing hub for Afghanistan. Itconnects Afghanistan to Pakistan - the onlyneighbouring market for Afghan horticulture productexports

+ Prices of vegetables increase when Kabul is inproduction (counter season with Pakistan)

+ Large local market for Central & South regions (CSO2003/04: ~ 3 millions urban inhabitants)

+ Best climatic conditions for horticulture productstorage (fresh and dried)

+ Good quality water available for industry

+ Important volume of trade for onion, potato, tomato& apples, grape and raisins

+ Long history of fruits export from Koh-e Daman (asnoted by Elphinstone, 19th century)

- Insufficient electric supply forindustry

- Old or non operational processingfactories (raisin)

- Fresh vegetable price trends aredominated by Pakistan market(Pakistan has a much larger marketand is early in production). Prices offresh vegetables are affected byPakistan before Kabul enters intoproduction

pp


Comparative Advantages


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Temperate climate fruits production (grape, raisin, apple, stone fruits andpomegranate) for exports in Pakistan and India

Summer/autumn vegetables production in counter season for Pakistan (potato,onion, tomato, )

Transformation industry for fruits juices (significant volume of apple and grape

production existing)

Storage, packaging and marketing of horticulture products

The Central and South regions have comparative advantages to excel in:

Southwest Region


Low and Mid elevation areas: between 700 m. absl in Garmseer (Helmand valley), 1300 Tirin

Qot and 1500 in QalatL i 265 d f f t d i K d h d L hk h


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Long growing season : 265 days free frost days in Kandahar and Lashkargah

Driest (most arid) region in Afghanistan

Southwest Region




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+ High potential for dried fruits production(raisin, apricot and fig)

+ Potential for fresh fruits exports to SouthernPakistan (grapes and melon-watermelon)

+ Significant volume of production for grape,raisin and pomegranate

+ The two large scale irrigation schemes offer

potential for horticulture development

+ Provincial specialisation already exists :grapes and pomegranate in Kandahar, apricotand almond in Zabul and Uruzgan

+ Production experiences for fruits and

vegetables in Southern Iran may apply toKandahar region

+ The dams and deep wells offer opportunitiesfor drip-irrigation development

- Suboptimal production practices(grapes grown on mud trellises; nopruning of pomegranates)

- Region was severely affected bydrought (perhaps 30-35% of orchardsdestroyed). Figs suffered the most

- Suboptimal irrigation practices;Drainage canal water re-used

- Salinity problems worsening with thedrought are a constraint for somehorticulture products (vegetables)

- Absence of vegetative cover (floormanagement) due to irrigation practicesin fruits and vine orchards results in

low quality fresh products (dust)- Low production volume for all

vegetables

- Management of the two large irrigationschemes is complex and sub-optimal

Southwest Region




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+

Direct access to existing regional markets (SouthernPakistan and India) and access to internationalmarkets through Karachi. It connects southernAfghanistan to Pakistan - the only neighbouringmarket for Afghan horticulture product exports

+ Rail project up to Kandahar

+ Successful experience in dried fruits processingwith CADG

+ Well established kishmish khana for high qualitygreen raisin production

+ Quality dried apricot suitable for regional export as

successfully experienced by CADG

- Insufficient electric supply forindustry

- Restrictive security for traders andinvestors

- Old or non operational processingfactories (raisin)

- Fresh vegetable price trends aredominated by Pakistan market

- Pakistan is competing in vegetablesproduction (no counter-season)

- Small local market in the Southwestregion (CSO 2003/04: ~ 0.4 millions

urban inhabitants)

- Labour cost is high due to poppycultivation

Southwest Region

Comparative Advantages


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Dried fruits production for regional and international markets (green and red

raisin, apricot and fig)

Fresh fruit production for Pakistan and Indian markets (grape, pomegranate,melon/water-melon)

Drip irrigation for vine and pomegranate orchards

Transformation industry for juice concentrates (significant volumes of grape andpomegranate production existing)

The Southwest region has comparative advantages to excel in:

East Region


Low area: between 800 m. absl in Metharlam and 500 m. absl at the Pakistan border

Warmest climate in Afghanistan: 315 days free frost days


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$$

$

$

$

$

%

East

Central

Gardeyz

Kulangar

Asadabad

Jalalabad

Mihtarlam

Chaharikar

Mahmud Raqi

N

EW

S

National landcover

Irrigated: Intensively Cultivated (1 Crop/year)Irrigated: Intermittently Cultivated

Permanent SnowPistachio Forest

Water Bodies

Fao region

$ Provincial centers% Capital

Irrigated: Intensively Cultivated (2 Crops/year)

Legend

20 0 20 Kilometers

Snow/Glaciers fed irrigation Good water availability

Permanent Snow

Snow/Glacier water irrigated fields

Shomali Plain

Kabul

Source: FAO/UNDP 1993 Land Cover

East Region




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+

Good irrigation water availability (Kabul, Alingarand Kunar rivers)

+ Large diversity of crops can be produced

+ Jalalabad region has similar productionconditions as Kunar, Alingar and Alishingvalleys has similar production conditions as

Swat valley in Pakistan. Production experiencesin these regions can apply to Jalalabad region

+ Tradition for blood orange production

+ Existing olive production capacity(approximately 2000 hectares)

+ Significant volume of onion and water-melonproduction

- Season too short for integrating onevegetable between the 2 cerealscultivated (if vegetables cultivated, onecereal is to be removed). Lack ofcomparative advantage with slightlywarmer climate in neighbouring

Pakistan- Frost days (50 days/year are not frost

free) is a limiting factor for some crops(banana, mango, etc..)

- Low volume of production for all fruits

- State farm owned by the MAAH (sub-optimal management)

East Region




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+ Fairly good security for traders and investors

+ Direct access to existing regional markets (Southern

Pakistan and India)

+

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Altai 2004 Horticulture Phase 1 Identification Business Opportunities

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