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Gum Arabic Value chain analysis in East Darfur, Sudan

Technical Report · May 2016

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 Gum Talha (Acacia seyal) Value Chain
Analysis in East Darfur, Sudan
EAST DARFUR STATE
February 2016
Table of Contents
Acknowledgements ................................................................................................................ 3
Acronyms .............................................................................................................................. 1
Executive summary ................................................................................................................ 2
1. Introduction ....................................................................................................................... 3
1.1 Background ............................................................................................................................ 3
1.2 Objectives of the analysis ...................................................................................................... 5
2. Definitions and theoretical framework ................................................................................ 6
2.1 Value chain ............................................................................................................................. 6
2.2 Value chain analysis .............................................................................................................. 6
2.3 Value chain mapping.............................................................................................................. 6
2.4 Value chain development ....................................................................................................... 6
2.5 Access theory ......................................................................................................................... 7
2.6 Conceptual framework ........................................................................................................... 7
3. Method .............................................................................................................................. 8
3.1 Study area............................................................................................................................... 8
3.2 Research design ..................................................................................................................... 8
3.3. Data collection....................................................................................................................... 9
3.4. Triangulation .......................................................................................................................11
3.5 Data analysis ........................................................................................................................11
3.6 Data presentation .................................................................................................................12
4. Results ............................................................................................................................ 13
4.1 Overview of Gum Arabic production in East Darfur .............................................................13
4.2 Structure of the Gum Arabic value chain .............................................................................15
4.3 Distribution of benefits and access analysis ......................................................................24
4.4 Constraints and bottlenecks ................................................................................................30
5. Conclusions and recommendations .................................................................................. 33
5.1 Conclusions ..........................................................................................................................33
5.2. Recommendations ..............................................................................................................34
References........................................................................................................................... 36

1
List of Tables
Table 1: Types of actors, genders and locations

Table 2: Gum Arabic value chain actors and their activities

Table 3: Socioeconomic characteristics of the surveyed actors in the Gum Talha value chain

Table 4: Estimates of Gum Talha production in the surveyed localities (2016)

Table 5: Taxes and duty fees on gum Talha for 2013 and 2016, and beneficiaries

Table 6: Gum producers’ average yields, costs and profits (n꞊130)

Table 7: Village trader's average prices, costs and profits (n꞊50)

Table 8: Town trader's average prices, costs, profit (n꞊15)

Table 9: Mechanisms for maintaining and controlling benefits

Table 10: Constraints and bottlenecks, as identified by producers

Table 11: Recommended interventions in response to particular constraints and bottlenecks

List of Photos
Photo 1: Group discussion with gum producers in Um Sigayi weekly market

Photo 2a: A producer holding an axe

Photo 2b: A wound on a Talha tree

Photos 3a and 3b: Sticky gum from the Talha tree

Photo 4: Natural stands of Talha (A. seyal) in Gemayzia, Abu Jabra locality

Photo 5: A taya in the forest

Photo 6: An agent at Sinaidira in El-firdos locality

Photo 7: An old A. senegal tree (Hashab)

Photo 8: A female gum producer selling gum to a village trader in Boro market

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List of Figures
Figure 1. The conceptual framework

Figure 2: The area covered by the study

Figure 3: The sales channels for Gum Talha from East Darfur

Figure 4: Gum production costs (%)

Acknowledgements
The author, Dr. Yahia Omar Adam, is very grateful for the cooperation and support of the staff of
the United Nations Environment Programme (UN Environment) and the Forests National
Corporation (FNC) in Ed Daein who facilitated the field survey and accompanied me to the sites
of the 'Natural Resource Management for Sustainable Livelihoods' project in East Darfur. The
consultant also extends his gratitude to the UN Environment team in Khartoum.

Thanks also go the enumerators for their intense commitment over long hours in difficult
conditions. In particular, thanks are extended to Mr. Adam Ibrahim, Mr. Mohamed Abuelgasim,
Samia Madibo and Salma Abdulrahman from the FNC. Special thanks go to the drivers (Yosif and
Mohamed) who ensured the field travel was on schedule.

Appreciation is also extended to Mr. Abdalla Adam Osman (the Director of the FNC East Darfur)
and Mr. Abdalla Hemidan (Project Manager, UNOPS) for their diligence and assistance during the
data collection. Very special thanks are also extended to all of the traditional leaders who
accompanied and introduced us to the local people in the visited areas. My thanks also go to all
the actors who deal with Gum Talha activities in the study areas for their welcoming reception
and their provision of the required data.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Acronyms
o
C degrees centigrade

FNC Forests National Corporation

GAC Gum Arabic Company

MT metric tons

NGO non-governmental organization

NTFP non-timber forest product

SDG Sudan ginah (USD 1 = 6.4 SDG)

UNEP United Nations Environment Programme

USD United States dollar

VCD value chain development

WFP World Food Programme

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Executive summary
This report describes the findings of a comprehensive and detailed value chain analysis for gum
Talha, which sought to: i) identify the product chain, the actors involved, their activities and
framework conditions; ii) determine the economic benefits and their distribution among the
actors and how these benefits are maintained and controlled; iii) identify key constraints and
bottlenecks and propose potential market-based solutions to develop the market chain of gum
Talha; and iv) suggest interventions and a framework to develop the gum Talha value chain so
as to increase benefits for the producers and the other actors.

The study, conducted in February 2016, used snowball sampling to select 197 study participants
(130 producers, 50 village traders, 15 town traders/agents and two companies/exporters) along
the value chain. Primary data was collected using semi-structured interviews, key informant
interviews, group discussions and direct observations. The quantitative data was analyzed using
SPSS version 20 and Excel 2010, while qualitative data was analyzed using text analysis.

The actors in the Gum Talha value chain include producers, village traders, town traders/agents,
companies/exporters and consumers in international markets. The study found that the profit
margin for the rural collectors was 48.76 per cent, while that for village traders was 54.94 per
cent, and that for town traders was 6.4 per cent. The main cost items for the rural producers
include food (45 per cent), labour (22 per cent), drinking water (18 per cent), gum transportation
(9 per cent), medication (4 per cent) and tapping tools (2 per cent).

The study identified the major constraints and bottlenecks at the local level as: low gum prices,
lack of market information, lack of producers' organizations, lack of financial credit, lack of
training on gum cleaning and drying, lack of drinking water, low regeneration capacity of Hashab
trees and poor tree management. The report concluded that the Gum Talha market chain profits
mainly the processors and exporters.

In view of the study findings, the following interventions are recommended: establish drinking
water points; build the capacity of gum producers; develop a market information system;
facilitate access to financial credit and establish Talha stands (with community involvement).

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

1. Introduction

1.1 Background
Non-timber forest products (NTFPs) have received greater attention in recent decades due to
their potential to contribute to rural livelihoods and national economies (Arnold and Perez, 2001).
The forests and woodlands of Sudan are a potential source for NTFPs and the sound
development of these products could have a significant impact on livelihoods (Adam et al., 2013),
especially among poor communities in dry land areas who have few options for economic
development due to harsh climatic conditions (Adam, 2015).

NTFPs extracted from the woodlands of Sudan are consumed and traded locally and are also
exported. Gum Arabic is one such NTFP. Gum Arabic not only offers an income and indemnity to
farmers against seasonal fluctuations in the prices of their agricultural products (FAO, 2011), but
is also an important source of foreign exchange to Sudan, annually injecting between 100 and
120 million USD into the economy, making it the most important NTFP in Sudan (Abdelmagid,
2014).

Prices in the international market for Gum Arabic have fluctuated greatly year to year, however,
and production of Gum Arabic saw an overall decline in the three decades between 1970 and
2000. Between 1969/70 and 1973/74 production declined from about 35,000 tons to about
23,000 tons. This decline was reportedly due to drought. In subsequent years, production
fluctuated and in 1984/85 fell to 11,000 tons, again due to drought. Production continued to
decline overall, and in 1991/92 fell to about 7,000 tons. This time the decline was attributed to
locusts. Subsequently, prices for Gum Arabic rose and production increased to about 39,000 tons
in 1994/95. When prices fell, however, production declined accordingly, reaching a low of about
3,000 tons in 1999/2000.

Gum Arabic is mostly produced by rural producers in traditional rain-fed farming areas, including
in Gedarif, Sinnar, Blue Nile, White Nile, all three states of Greater Kordofan and all five states of
Greater Darfur. These areas contain up to 20 per cent of Sudan’s population, or around 6 million
people, who are among the poorest and most vulnerable in the nation in terms of food insecurity
(Couteaudier, 2007).

Gum Arabic is derived from two acacia species: Acacia senegal, known locally as Hashab, and
Acacia seyal, known locally as Talh. Both species spread naturally in the central belt of the low-
rainfall savannah where they grow in pure or mixed stands; in clay plains in the east and sandy
soils in the west. Gum Arabic from Hashab is of higher quality and is mostly produced from trees
grown on farmers' fields. Talh is more likely to grow wild, along the Nile as well as in Darfur, and
to be tapped in the wild. According the field survey findings, annual yields of gum from Talh trees
range between around 200 and 400 grams. The trees are exploited from the ages of 5 to 25.

Gum is produced by the trees in response to wounds; gum sap exudes to protect the tree (Abdel
Nour, 2013). Exudation of gum often occurs naturally in response to damage caused by animals,

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

insects, etc. Harvesting of gum by humans requires first wounding the trees using an axe (sunki).
In Sudan, the wounding (tapping) of trees begins at the end of the rains and before the cold spell
in October/November when tree growth stops, leaves are shed and trees begins the dormancy
stage. In Darfur the season for tapping is November to May. The first harvest is four to six weeks
after tapping and then gum is collected every 10 to 14 days, with between six and 12 collections
each season (Seifel Din and Zarroug, 1996). The tapping process is normally carried out by hired
labour (nafir) but collection of the gum is carried out mainly by family labour.

Gum Arabic production is one of the most important activities of the savannah forests of central
Sudan. The significance of the income gained from gum production is that collection of Gum
Arabic is carried out during the dry season. The activity therefore does not compete with farming
activities. This allows farmers to make use of their slack period and acquire supplementary
income. The activity employs all members of the family for between four and six months per year
and provides seasonal labour for people from other parts of the country, who migrate to the gum
belt area during the season.

Gum Arabic is sold by the producers (those who tap, collect, transport the gum) to local
merchants, who in turn sell the product to town merchants (middlemen) and agents, who sell it
to exporters and processing companies.

The producers generally transport their gum (using animals) to the village merchant who pays
for it in cash or in kind. These transactions take place outside the organized and governmental-
controlled markets. Thus, most producers do not receive the fixed minimum price; they get
inadequate prices for their products. The local merchant serves as a link between the producers
(who are unable to contact town merchants directly) and the town merchants who buy the gum
and undertake the cleaning, grading, repackaging and sorting processes and who transport the
gum to exporting companies. Very little Gum Arabic is consumed domestically and Sudan
commands over 60 per cent of the world's Gum Arabic production and trade.

According to the Gum Arabic Board, at least 30 per cent of the Gum Arabic traded in Sudan is
produced in Darfur. East Darfur is a particularly important production area for talha, from the
Acacia seyal tree. According to Forests National Corporation (FNC) records, of the 32,000 metric
tons (MT) of Gum Arabic produced 2014, 26,000 MT came from A. seyal and the remaining 6,000
MT came from A. senegal.

Gum Arabic and other natural resources have the potential to contribute significantly to the local
rural economy in East Darfur as well as to the national economy, but this potential has not yet
been fully exploited due to constraints on the commodity value chain.

The key factor affecting Sudan's Gum Arabic sector has been the national government policy for
the product, particularly the domestic marketing arrangements and pricing (Buchanan-Smith et
al., 2013). Low prices encouraged cross-border smuggling of Gum Arabic, especially from Darfur
to Chad. In 2009, the Government of Sudan liberalized trade in Gum Arabic and committed to

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

abolishing the export monopoly held by Gum Arabic Company (GAC). This liberalization had an
immediate positive impact on producer prices.

The World Bank had long sought to boost the Gum Arabic sector in Sudan and was the major
advocate of the liberalization of gum Arabic market to end the GAC's monopoly. The Multi-Donor
Trust Fund (MDTF) managed by the World Bank co-funds work to boost Gum Arabic production
in 11 localities in North and South Kordofan, White and Blue Nile, and the states of Sinnar and
South Darfur, in collaboration with the International Fund for Agricultural Development (IFAD).

1.2 Objectives of the analysis

Against this background, the UN Environment conducted a Gum Talha value chain analysis in
East Darfur, aiming to identify areas of intervention and recommendations for Gum Talha value
chain development, so as to increase gum production, improve producers' market
competitiveness and sustain gum Arabic producers' livelihoods.

The specific objectives of the analysis were to:

Identify the product chain, along with actors involved, their activities and framework
conditions.
Determine the economic benefits distributed between actors and how these benefits are
maintained and controlled.
Identify key constraints and bottlenecks and propose potential market-based solutions
to develop the market chain of gum Arabic and thereby improve livelihoods.
Identify appropriate interventions and a suitable framework to develop the gum Arabic
value chain so as to increase the benefits for producers and other actors.

Value chain approaches are utilized by development practitioners and researchers to capture the
interactions within increasingly dynamic and complex markets and to examine the inter-
relationships between the diverse actors involved (Kaplinsky, 2004; Bolwig et al., 2010). By going
beyond firm- or activity-specific analysis, value chain analysis allows for an assessment of the
linkages between and among productive activities. The value chain approach thus provides a
framework to analyze the nature and determinants of competitiveness in value chains in which
small producers participate. It also provides the basic understanding needed for designing and
implementing appropriate development programmes and policies to support their market
participation. Indeed, many development interventions now utilize the value chain approach as
an important entry point for engaging small producers, individually or collectively, in export
markets for high-value products (Amanor, 2009).

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

2. Definitions and theoretical framework

2.1 Value chain

A value chain is the set of activities and links that are involved in a particular product being
created, delivered to consumers and disposed of afterwards (Kaplinski and Morris, 2002). These
activities include bringing inputs and services together to grow, transform or manufacture a
product; transporting the product from the producer to the customer; and increasing the value
of the product.

2.2 Value chain analysis

Value chain analysis is a process of examining each part of the production and sales process of
a product, from design to distribution, to identify where improvements can be made. It also
examines overall revenue and gross physical output, as well as net value added and the
distribution of burden or benefit (Webber and Labaste, 2010). Value chain analysis can be used
for a wide variety of purposes, from improving business results to examining inequalities in
global income distribution (Kaplinsky and Morris, 2002).

2.3 Value chain mapping

The purpose of value chain mapping (VCM) is to develop a visual presentation of the actors and
their activities and the connections between the actors, as well as of how benefits are distributed.
Value chain mapping enables one to understand the relationships between the various
stakeholders (actors), the flow of products and values, the services and the business regulations
that are crucial to the functioning of the value chain.

2.4 Value chain development

Value chain development (VCD) is a process by which the performance of the value chain is
enhanced through various interventions (Poschen, Sievers and Abtew, 2014). VCD includes
intentional efforts to build win-win relationships between two or more chain actors (producers,
distributors, processors, wholesalers and retailers) so as to strengthen mutually beneficial
business relationships. The stronger the resulting win-win outcomes, the more likely the
business relationships are to endure and thrive over time.

There are numerous ways of developing a value chain, including: process, product, functional
and chain upgrading. Process upgrading focuses on increasing the efficiency of production,
within links and between links in the value chain. Product upgrading refers to enhancing the
quality and specifications of the product, whether by creating an entirely new product or by
improving the old product. Changing the scope of activities carried out within the firm as a means
of adding value is functional upgrading. Chain upgrading can involve a move into a new value
chain altogether by using the skills gained from participating in an existing value chain. Product
and process upgrading are the most common VCD strategies, while functional upgrading is
difficult to achieve (Mitchell, Keane and Coles, 2009).
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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

2.5 Access theory

Property rights are key in determining the use of resources and they influence the behaviour of
resource users. Access theorists argue, however, that “access” is also essential in the derivation
of benefits from resources. “Access” can be defined as "the ability to derive benefits from things"
(Ribot and Peluso, 2003). Following the "theory of access", it is necessary to examine the power
relations in value chains as well as the rights of the stakeholders.

2.6 Conceptual framework

The analysis used the value chain analysis (VCA) framework of Kaplinsky and Morris (2002).

The analysis of the gum Arabic value chain in East Darfur included the following steps:

Mapping of the activities in the chain and characterizing the actors participating in the
chain.

Identifying the constraints and bottlenecks in the value chain, and appropriate VCD
strategies to overcome these.

Identifying who benefits from participation in the chain, and assessing how the distribution
of benefits would be influenced by restructuring the chain through various upgrading
strategies (Rich et al., 2011).

Figure 1 illustrates the conceptual framework for the value chain analysis.

Figure 1. The conceptual framework

Enabling environment

Producer Village Town Trader Agency/ Consumer

Trader exporter

Costs, margins, constraints/bottlenecks

Value chain development based on constraints/bottlenecks

(Vertical & Horizontal Development)

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

3. Method

3.1 Study area

The study was conducted in the state of East Darfur in Sudan. The state shares borders with the
Republic of South Sudan in the south, West Kordofan in the east, North Darfur in the north-west
and South Darfur in the west
(Figure 2). East Darfur
occupies a total area of
53,000 km2 and has a
population of around 1.3
million. Summer (dry
season) starts in March and
ends in May, with an average
daily temperature of 40o C.
The rainy season starts early
in June and ends in October.

East Darfur has a rich

savannah region in the south
and a poor savannah in the
north and has diverse
livelihood resources,
Figure 2: The area covered by the study including Gum Arabic,
fisheries, livestock and
agricultural land. The main land uses are animal husbandry, agriculture and forestry. Almost
three quarters (70 per cent) of the population are farmers and pastoralists, who depend on
natural resources for their livelihoods. The capacity of farmers to produce food is limited by
erratic rainfall, low soil productivity and inadequate technology, together with an inefficient
marketing system and lack of financial support. The main agricultural schemes are Um Ajaja,
with an area of 100,000 feddan, and Abu Fama, with an area of 36,000 feddan. Livestock
ownership indicates wealth and prestige. The types of livestock owned include cattle, sheep,
goats and camels. Forests cover an area of 4,321,000 feddan (31 per cent of the state’s total
area) (Personal communication, FNC, 2016).

3.2 Research design

The case study approach was employed. Beginning with local Gum Talha producers who collect
gum, the analysis traced the chain of actors and processes to the final domestic and export
market in the country. The units of analysis were thus groups of actors at different levels in the
value chain. The case study approach was considered to be appropriate because value chain
analysis is explorative study that needs multiple sources of evidence for in-depth understanding
of the processes, outcomes and components along the value chain.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

3.3. Data collection

The researcher reviewed the literature on the Gum Talha sector in Sudan so as to understand the
general situation at the national level and identify the key issues. Subsequently, the researcher
gathered information from stakeholders and secondary sources so as to make a preliminary
identification of the various stages (e.g. collection, processing and trading). The identification of
the actors directly involved in the Gum Talha value chain was undertaken in consultation with
UN Environment, the Forests National Corporation and key informants in East Darfur. Data were
collected using a combination of participatory rural appraisal tools.

Primary data were gathered using interviews, group discussions and direct observations. The
sources of primary data included Gum Talha producers, village traders, town traders, processors
and wholesalers/exporters. Interviews were conducted with people who had first-hand
information about the production and consumption of gum Arabic in the study area (“key
informants”). This data informed the initial mapping of the value chain.

The key informants for this study were selected using the snowball sampling technique, whereby
participants identify other respondents. It is an informal method, particularly relevant in
qualitative, explorative and descriptive research using interviews. The use of snowball sampling
limits the validity of the sample, however, due to non-random sampling and bias towards the
inclusion of individuals with relationships. These limitations were mitigated by increasing the
number of respondents and using additional methods and sources for triangulation.

Semi-structured in-depth interviews were held to collect primary data from value chain actors at
each stage. Information collected included the characteristics of actors, the cost of inputs, price
of outputs, the mechanisms of access, intra-group integration and their links to upper and lower
stages in the chain, and the processes at each stage. The interviews were conducted based on
semi-structured questionnaires followed by additional questions (depending on the responses)
to clarify or expand on particular issues of interest. The number of in-depth interviews conducted
during the study was 197. In addition, informal conversations were held with local community
members.

A summary of the key information collected about the respondents’ via the in-depth interview is
presented in Table 1.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Table 1: Types of actors, genders and locations

Group discussions were held with the village committees (five to 10 members), tribal leaders
(sheikhs and omdas) and local community members and producers in each of the study areas
(Photo 1). The focus of the discussions was on the production and trading of Gum Arabic, market
potential, and the opportunities and constraints along the chain.

Photo 1: Group discussion with gum producers in Um Sigayi weekly market © Photo credit: Yahia Omar Adam

Secondary data was collected (on production, trading, taxes and other fees, and related issues)
from FNC offices, locality finance offices, NGOs working in the area, the Ministry of Agriculture,
the customs authority, internet sources and from previous related research works and other
relevant sources.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Direct observations were made of the process of producing Gum Arabic in the forests, as well as
of sales in the market places, and of cleaning and packaging by labour employed by agents.
These gave the researcher an insight into the production and trade of the product. These
activities and the interactions between the actors were observed and in some cases recorded
using digital cameras. This non-participant observation provided accurate information and was
used to check the information collected through the interviews, especially in relation to sensitive
topics such as prices and benefits.

3.4. Triangulation
The combination of approaches and data collection tools employed for the study, and the
multiple sources enhanced the validity and reliability of the information collected and allowed
triangulation of data, especially on sensitive issues like prices, gum quantities, benefits, costs,
and the interactions between different actors. For example, the selling prices provided by
respondents were cross-checked with information about the buying prices. Additional
investigation was carried out when there were discrepancies.

3.5 Data analysis

The data analysis process involved:

Mapping the value chain and preparing a graphic presentation of the various actors
involved in the chain, their principal activities, links between them and the framework
conditions.

Quantifying the physical flow, value added and distribution of benefits along the chain.

Mapping access and identifying and presenting the various mechanisms used by actors
to gain control and maintain access to benefits.

The initial mapping involved:

Identification of rural markets.

Identification of key functions and activities.

Identification of the actors performing each function.

Mapping the actors according to the functions they perform.

Mapping links between participants.

The initial map of the value chain was developed with inputs from key informants, then was
further refined by supplementing detailed information derived from the responses to the in-depth
semi-structured interviews with value chain actors and field observations.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

3.5.1. Estimates of costs and margins

The production, marketing and processing costs were estimated based on formulas (see below).
The costs comprised the following components: collection, labour, drinking water, food,
transportation, taxes, duty fees, processing and packing materials.

𝐺𝑢𝑚 𝐴𝑟𝑎𝑏𝑖𝑐 𝑝𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛, 𝑝𝑟𝑜𝑐𝑒𝑠𝑠𝑖𝑛𝑔 and 𝑚𝑎𝑟𝑘𝑒𝑡𝑖𝑛𝑔 𝑐𝑜𝑠𝑡𝑠

= 𝑐𝑜𝑙𝑙𝑒𝑐𝑡𝑖𝑜𝑛 𝑐𝑜𝑠𝑡 + 𝑙𝑎𝑏𝑜𝑢𝑟 𝑐𝑜𝑠𝑡 + 𝑡𝑟𝑎𝑛𝑠𝑝𝑜𝑟𝑡𝑎𝑡𝑖𝑜𝑛 𝑐𝑜𝑠𝑡 + 𝑑𝑟𝑖𝑛𝑘𝑖𝑛𝑔 𝑤𝑎𝑡𝑒𝑟 𝑐𝑜𝑠𝑡
+ 𝑡𝑎𝑥𝑒𝑠 + 𝑍𝑎𝑘𝑎 + 𝑝𝑟𝑜𝑐𝑒𝑠𝑠𝑖𝑛𝑔 + 𝑒𝑡𝑐 …

The quantitative data regarding the cost benefit structures, value added, benefit distribution were
estimated using the formula below. Gross margin was calculated as an indicator for benefit
distribution along the value chain.

𝑅𝑒𝑣𝑒𝑛𝑢𝑒 − 𝑡𝑜𝑡𝑎𝑙 𝑐𝑜𝑠𝑡

𝐺𝑟𝑜𝑠𝑠 𝑚𝑎𝑟𝑔𝑖𝑛 = × 100
𝑅𝑒𝑣𝑒𝑛𝑢𝑒

3.5.2. Estimates of value added

The added value was calculated based on buying and selling prices. The International Institute
of Rural Reconstruction (2008) defines value added for a particular actor as the price received by
the actor minus the price paid by the actor. Thus, value added gained at each stage along the
chain as the commodity flows through the respective stage along the chain was estimated using
the following formula (Bockel and Tallec, 2005):

𝑉𝑎𝑙𝑢𝑒 𝑎𝑑𝑑𝑒𝑑 = 𝑆𝑒𝑙𝑙𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 − 𝐵𝑦𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒

3.6 Data presentation

Quantitative data was analyzed using the Statistical Package for Social Science (SPSS) version
20 and Microsoft Excel while text analysis was applied for qualitative data. The results of the
study were presented in the form of tables, diagrams, figures and text.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

4. Results

4.1 Overview of Gum Talha production in East Darfur

4.1.1 Tapping and collection
The tapping of the Talha tree involves wounding the tree trunk, using a traditional tapping axe to
make an incision in the bark (Photos 2a and 2b).

Photo 2a: A producer holding an axe; Photo 2b: A wound on a Talh tree © Yahia Omar Adam

According to the surveyed producers, tapping is practiced during the dry season. It begins after
the rains at the end of October or in early November. At this time the trees have started to shed
their leaves. Tapping ends before the rainy season begins (i.e. end of May or early June). The
production season is six months long but depends on the onset and end of the rains. Producers
usually observe weather conditions before starting gum collection. The season of tapping and
collection of gum corresponds with the off-season in the study area, when there are no
significant rain-fed crop production activities.

The first harvest of gum nodules is collected two weeks after tapping. Gum continues to exude
from the same injured spot and is collected every seven days. Gum is harvested from each tree
between six and 12 times during the season.

13
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

4.1.2 Drying, cleaning and packing at the production site

The gum collected from the trees is taken to a local camp called the “taya". Here the producers
pack the collected gum in plastic sacks with 100 kg capacity (two guntars) in preparation for
transport to the nearest agent. The average amount of gum each producer takes to the market
per week is estimated at three guntars. It was observed that the producers do not undertake
practices related to drying and cleaning at the production site. The granules therefore get stuck
together and turn black, which is not the desired colour of pure gum (Photos 3a and 3b).

Photos 3a and 3b: Sticky gum from the Talha tree © Yahia Omar Adam

4.1.3 Production arrangements

Gum production in the study areas is conducted from natural stands of A. seyal (Talha trees)
(Photo 4). These stands in natural woodlands are tribal or state property, so permission is
required from the tribal leader (e.g. omda or sheikh) to undertake tapping and collection of gum.
The permission is issued by the leader based on the agreement signed between the producers
and tribal leaders in each village.

Photo 4: Natural stands of Talha (A. seyal) in Gemayzia, Abu Jabra locality © Yahia Omar Adam

14
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Normally, tribal leaders distribute the forested land to their people for gum production. The
distributed areas range in size between five and 150 feddan, based on the capacity of the
producers to tap the area. Such area distribution and demarcation is very important for avoiding
conflicts between producers. In addition, it ensures the property remains with the tribal leaders.
However, the benefits shared between the producers and the tribal leaders are not clear.

Tapping is normally done by “taya”, i.e. the areas where the producers establish camps for
cooking, sleeping, collection and packing of the gum (Photo 5). Each taya covers an area of about
150 feddans. Depending on the density of the A. seyal trees, five to ten producers work in one
taya. The camps are established in central places for ease of access to the entire production
area and for the transport of the gum to weekly markets or agents in urban areas.

Photo 5: A taya in the forest © Yahia Omar Adam

4.2 Structure of the Gum Talha value chain

4.2.1 Actors, their characteristics and activities
The value chain of gum produced and sold in East Darfur has three parts: production, cleaning
and distribution.

The study revealed that the gum Arabic value chain comprises eight major groups of actors, as
follows:

i. Gum producers (those who produce gum on forested land with production permission).
ii. Traders at the local level (village traders).
iii. Traders at the town level (middlemen, agents of urban merchants).
iv. Sellers to agents.
v. Agents (buyers for processors).
vi. Manufacturers and exporters (processing companies and other commercial enterprises);
vii. The government (FNC, Tax office, Zakat administration).
15
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

viii. Tribal leaders.

The actors engaged in the value chain and their activities are presented in Table 2.

Table 2: Gum Talha value chain actors and their activities

Actors Activities

Producers Tree tapping, gum collection, packing, bringing gum to weekly markets

Village traders Weighing, sorting, packing, collecting gum for agents

Town traders Gum collection from village traders, cleaning, sorting, repacking, weighing,
transport, fee and tax paying

Agents Gum collection, cleaning, sorting, repacking, weighing, transport, fee and
tax paying

Exporters Processing, grading, repacking, export fees, transport

As observed in the field, producers take the gum to the village weekly markets, and sell it to village
traders, middlemen and brokers who, in turn, sell the gum to agents. Some of the village and town
traders deal with all weekly markets and others buy from just one or two markets, depending on
their capital and the transaction size. The agents purchase Gum Arabic on behalf of processing
companies and other commercial enterprises. The main locations where agents bought the gum
in the visited areas were Abumatarig in Bahr Al Arab locality and Sinaidira in El-firdos locality
(Photo 6).

Photo 6: An agent at Sinaidira in El-firdos locality © Yahia Omar Adam

16
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

In East Darfur State, Talh trees are found in pure stands, especially in Um Ajaja administrative
Unit (Abu Jabra locality), while Hashab trees are scattered (Photo 7). Therefore, much less
Hashab gum is available in East Darfur than Talh. Some Hashab gum is imported from South
Darfur State, especially from Boram locality, but only in small quantities. Some areas in East
Darfur have more Hashab than the areas covered for the study, but those areas, including the
eastern localities (Abu Karinka, Yassin, etc.), were not covered by this study for security reasons.

Photo 7: An old A. senegal tree (Hashab) © Yahia Omar Adam

The majority of traders have relationships with producers that begin before tapping, while some
traders begin their relationships with producers only when buying gum in the rural markets. The
majority of traders provide producers with an interest-free loan, followed by sharing and finally
by the Shail system in which the payment is made either in cash or cash plus food before the
gum producer harvests the gum. Most traders in Gemazyia (Abu Jabra locality) have shops in
gum collection areas. This strategy is very important for securing the supply of gum at very low
prices without competing with other traders.

The agents buy the Gum Arabic for processing companies in return for a commission. The
processing companies are significant buyers of Gum Arabic by virtue of their financial capacity
and the available cash they have for payment. The agents do not deal directly with the producers
or with village traders.

The socioeconomic characteristics of Gum Arabic actors are believed to have a great impact on
their sales decisions as well as on the design and implementation of the interventions for Gum
Arabic production and marketing development at the local level.

Gender roles and responsibilities in the study area are influenced by social, economic and
cultural factors. The local community in East Darfur is patriarchal and resource ownership is
male dominated, but women are heavily involved in economic activities, including agricultural
production, fuel wood collection, drinking water collection, and gum tapping and collection.
17
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Nevertheless, the survey results revealed that the majority of the gum producers are male (69.2
per cent) (Table 3).

Half of the male producers (50 per cent) indicated livestock as their most important income
source, but 60 per cent of the female producers considered Gum Arabic as their most important
income source (Table 3). While all of the surveyed male producers work full-time on producing
and selling Gum Arabic during the season, only half of the female producers do so.

Most male producers (70 per cent) and almost all female producers (90 per cent) have no
education, with only 2 per cent of the male producers having completed primary education.
Almost a third (28 per cent) of the male producers have Khalwa1 education, however. Around a
third (37 per cent) of the village traders have primary education, while 3.1 per cent of town traders
have university education (Table 3).

According to the responses from male producers, the average family size at the local level is 9,
while for female producers the average is 6, and for village traders the average is 11.

Table 3: Socioeconomic characteristics of the surveyed actors in the Gum Talha value chain

Actors/soci
o-economic P* VT TT E
Class
characterist
ics

Gender Male 69.2% 100% 100%

Female 30.8% - -

Average Male 42 years 36 years 45 years

age
Female 35 years

Education Male Female

level
Illiterate 70% 90%

Khalwa 28% 10% 62.5% 10.9%

Primary 2% - 37.5% 42.3%

Secondary - - 43.7

1
Religious school in which Muslims study the Holy Koran.
18
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Actors/soci
o-economic P* VT TT E
Class
characterist
ics

University - - 3.1% 100%

Marital Male Female

Status
Single

Married 90% 100% 100% 100%

Divorced 8.2% -

Widowed 1.8% -

Family Size Male Female

Average 9 6 11 13

Male Female

Actor's Average of
experience years
6 5 10 15 5

Gum Male Female

Important Livestock 40% 60% 50% 70%

income
Agricultur 50% 30% 50% 20%
source
e
10% 10% 10%

Male Female

Gum Arabic Full time 100 50% 70% 50% 100%

production %
50% of
and sales
time
during the 30%
season 25% of -
time
20%
-
*
P, VT, TT, and E indicate producer, village trader, town trader, and exporter, respectively.
19
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

4.2.1 Sales channels for Gum Talha in East Darfur

Gum Arabic produced in East Darfur is sold via various sales channels at the state level, via
North Kordofan, in Khartoum and overseas. At the state level, the gum producers and the village
and urban traders are the main players (Figure 3).

Figure 3: The sales channels for Gum Talha from East Darfur

[Link] Gum yields

Yields of gum depend on factors such as the density of the trees, weather conditions
(temperature, rainfall, etc), site condition, tapping intensity and frequency, etc. The surveyed
producers indicated that they produce three guntars of gum per week (i.e. approximately 150
kg), on average. The total volume of Gum Arabic produced and sold in each locality was
estimated based on the information provided by the sheikh in each weekly market visited, as
presented in Table 4.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Table 4: Estimates of Gum Talha production in the surveyed localities (2016)

Market/ Gum Talha Gum Hashab

Locality Coordinates Quantities Quantities Remarks
Agent (guntar) (guntar)

Um Ajaja N 10 00. 365

E 027 04.
450
90,000 - More gum
Elevation: was
Abu Jabra 313 produced in
2016 than in
Gemayzia N 09 53. 846
2015.
E 02701. 167

Elevation: 60,000 -
411

Boro N 1025.877

E 2617.126

Elevation: 20,400
434

Sharashri N 1045. 402

E 2628.032

Elevation: 9,600 4,800

Abumatarig Only 10% of
369
trees are
Um Sagyi - 15,000 - tapped

Abumatarig N 1058. 853

E 2612.396

Elevation: 527,340 -
446

Hibail N 1046. 144 The most

important
El-firdos E 2603. 120
gum Talh

21
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Market/ Gum Talha Gum Hashab

Locality Coordinates Quantities Quantities Remarks
Agent (guntar) (guntar)

Elevation: 38,000 - production

453 area in Bahr
El-Arb
Abu N 1053. 271
Sinaidira
E 2551. 187

Elevation: 36,000 -
395

El-firdos - 576,000

TOTAL 853,540 4,800

[Link] Gum distribution

The gum produced in the study area is sold at local weekly markets to village traders and other
middlemen (Photo 8), who then transport the product to agents located in urban areas or directly
to El Obied in North Kordofan and/or Khartoum.

The major rural markets for Gum Talha in East Darfur are in Um Ajaja, Gemazayia, Abu Sinaidira,
Hibail, Sharashri, Boro and Um Sigiyi. The price for Gum Arabic is fixed by the traders and the
producers have no power to negotiate.

Photo 8: A female gum producer selling gum to a village trader in Boro market © Yahia Omar Adam
22
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

From the rural markets, the product is trucked to agents in the region or to urban markets where
it is delivered to urban merchants. For example, in Um Ajaja, Sharahri and Abumatarig the agents
transport the gum to Elobeid and Khartoum.

Taxes and local duties on Gum Arabic are collected when the product is transported from the
market or the agent to El Obeid or Khartoum. The various forms of various taxes and local duties
imposed on Gum Arabic are presented in Table 5.

Table 5: Taxes and duty fees on gum Talha for 2013 and 2016, and beneficiaries

Fess/Taxes 2013 (SDG/guntar) 2016 (SDG/guntar) Beneficiaries

FNC tax 7 16 FNC

Zakat 15 24 Central
government

State fee 4.5 9.75 State government

Tax on business profit 2.5 S11 Central

government

Truck departure fee 0.11 1 State government

Total 29.11 61.75

Sources: Buchanan-Smith et al., 2013; Trader interview, 2016.

[Link] Gum cleaning and cutting

Urban merchants and agents in Ed Daein buy gum in bulk quantities from local traders and clean
it. This cleaning is the only form of processing at the local level. It is undertaken by women and
involves removing foreign materials such as bark and other gum, and using an axe to crush the
big granules that stick together so as to separate them, then repacking the gum (Photos 9a and
9b).

The cleaning and cutting is very difficult and time consuming. One middle-aged woman reported
that the money she receives is not sufficient given the level of effort required to cut the gum and
repack it. Women are paid 3.5 Sudan ginah (SDG) per guntar and each woman handles between
five and eight guntar of gum each day.

23
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Photos 9a and 9b: Rural women cleaning and cutting the gum in Abumatarig © Yahia Omar Adam

4.3 Distribution of benefits and access analysis

4.3.1 Producers’ costs, incomes and profit
The study findings indicate that producers make a profit margin of 48.76 SDG per guntar. On
average, producers sell 50 guntars per season and their total costs per season are 5,380 SDG.
The net income of each producer was estimated at 5,120 SDG per season (Table 6).

Table 6: Gum producers’ average yields, costs and profits (n꞊130)

Item Quantity/value ± S.E

Average yield (guntar/season) 50 ± 43.16

Average food (subsistence) costs (SDG*/season) 2400 ± 66.79

Average labour costs (SDG/season) 1200 ± 12.82

Average gum transportation costs (SDG/season) 480 ± 5.17

Average drinking water costs (SDG/season) 1000 ± 0.34

Average tapping tools costs 100 ± 0.59

Medication costs (SDG/season) 200 ± 0.59

Total costs (SDG/season) 5380

24
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Item Quantity/value ± S.E

Cost per guntar (SDG) (Total cost/average selling quantities) 107.6

Average selling price (SDG per guntar) 210 ± 0.16

Total revenue (SDG/season) (average price * average production) 10500

Profit (total revenue – total costs) 5120

Gross margins% 48.76

*1 USD = 6.4 SDG

As illustrated in Figure 4, the largest cost item for producers of gum is food. This item accounts
for 45 per cent of total gum production costs each season. The implication of this is that some
rural producers must enter into contracts with village traders and agents so as to obtain
sufficient food during the production season. Under such contracts, the producers receive loans,
either in cash or cash plus food. In return, the producers sell their yields to the village trader or
agent in question. Accordingly, the producers lose power to negotiate on the gum price. They
must accept the price announced by the trader.

Figure 4: Gum production costs (%)

Medication cost Tapping tools cost Drinking water cost

Gum transportation cost Labour cost food cost

4% 2%

18%

45%

9%

22%

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

4.3.2 Village traders’ costs, incomes and profit

The study findings indicate that the village traders who buy the gum directly from producers sell
the gum for a price of 220 SDG per guntar, on average, and they sell 540 guntars of gum, on
average, each season. Accordingly, each village trader has an estimated total revenue of 118,800
SDG per season. The input costs deducted were the purchase value of the product, gum
transportation and labour costs. The cost per guntar of gum at the village trader level is 99.11
SDG. Table 7 presents the average prices, costs, incomes and profits of the village traders.

Table 7: Village trader's average prices, costs and profits (n꞊50)

Item Quantity/value ±
S.E

Average selling quantity (guntar/season) 540 ± 16.30

Average gum purchase costs (SDG*/season) 50400 ± 70.90

Average labour costs (SDG/season) 1200 ± 2.22

Average transportation costs (SDG/season) 1920 ± 7.15

Total costs (SDG/season) 53520

Cost per guntar (SDG/season) (Total cost/average selling quantities) 99.11

Average selling price (SDG/guntar) 220 ± 0.22

Total revenue (SDG/season) (average price * average purchase) 118800

Profit (SDG/season) (total revenue – total costs) 65280

Gross margin % 54.94

*1 USD = 6.4 SDG

4.3.3 Town traders' prices, costs and profit

The urban traders each handle about 1,000 guntars of gum per season. As shown in Table 8,
when costs are accounted for, town traders earn a net income of 300,000 SDG per season, on
average, from their gum trading and distribution operations, with a profit margin of 6.4 per cent.
This low profit margin does not include commissions they receive from agents and/or
processing companies. The urban traders and agents agree on a commission to be received by
the urban trader after transporting gum to the company or to collection points in urban areas, or
to Elobeid and Khartoum.
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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Table 8: Town trader's average prices, costs, profit (n꞊15)

Item Quantity/value ± S.E

Average gum sold (guntars/season) 1000 ± 43.16

Average purchase costs (SDG*/season) 220000 ± 66.79

Average Transportation costs (SDG/season 2000 ± 12.82

Average gum cleaning costs (SDG/season) 3000 ± 5.17

Average sack cost (SDG/season) 25000 ± 0.34

Average taxes and local duties (SDG/season 30875 ± 0.59

Total costs (SDG/season) 280875

Average selling price (SDG/guntar) 300

Total revenue (SDG/season) (average price * average production) 300000

Profit (SDG/season) (total revenue – total costs) 19125

Gross margin % 6.4

*1 USD = 6.4 SDG

As noted above, the cleaning of the gum is exclusively performed by female labour. This activity
offers full-time employment for many women in urban areas. The women clean between five
and eight guntars of gum per day. For each guntar they clean and pack, they receive up to 5 SDG,
so get a total of between 25 and 40 SDG per day. The agent in Abumatarig employs between 25
and 40 women per day. Urban merchants also employ between six and eight men each day to
load the gum (517 guntars) onto trucks.

4.3.4 Comparison of benefits

Although gum producers put in the most work, they receive the lowest income of all of the actors
in the value chain. They spend many weeks away from their homes and invest their energy in a
hostile and risky environment during tapping and the collection of the gum, where they are
exposed to malaria and poisonous snakes. For the entire production season (five to six months)
a producer receives a gross income of only 5,120 SDG which is equivalent to the average income
for women who clean the gum. The main reason for the low incomes of the producers is that
they are not able to sell their product by themselves to the end users; they must sell to village
traders. Producers lack access to market information and traders do not share information with
27
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

them. Because of the long distance to markets and financial limitations, rural producers are not
able to transport their gum to urban markets where they could get higher prices, and the lack of
alternative credit facilities means they can only obtain loans from village traders. Therefore, they
are forced to sell their product to the village traders.

The chain is inefficient in communicating market information, especially to those actors at the
base of the chain. The general manger of two companies in Khartoum felt that companies gain
a high annual net income from gum owing to their strong financial capacity; physical assets
(warehouses in urban centres); social assets, such as strong ties with town traders; backward
integration in the chain; and knowledge of the trading structure. The financial resources used in
the trading of Gum Arabic come from urban merchants in most cases and are lent to producers
and village traders via a traditional share system.

In line with the vertical distribution of benefits, the financial capital required also varies. At the
village level, little financial capital is required for production, while at the village trader level the
financial requirements are moderate. More capital is invested at the town trader and agent level
as they spend more on purchasing, cleaning and transporting the product. Access to credit
facilities and financial resources is a limiting factor for all actors along the Gum Arabic value
chain. The main sources of capital are informal loans and advances from traders and agents.

The types of A. senegal Gum Arabic sold by exporting companies include: Cleaned, Hand Picked
Selected (HPS), Cleaned and Sifted (C&S), Kibbled, Siftings, Dust and Powder. A. seyal Gum
Arabic only exists in the ‘Cleaned’ format. A large proportion of Gum Arabic produced in Sudan
is exported in its raw form, just ‘cleaned’, ‘handpicked‘ or ‘sifted’. Sudanese Gum Arabic is sold
in various parts of the world, including Europe, the USA, India, South America, mainland Asia and
Japan.

The lack of local treatment in Sudan is linked to the difficulty of trading processed Gum Arabic
on the international market; the coalition of competing international processors who limit the
market; and the lack of sufficient financial strength to sustain the processing sector.

4.3.5 Access to benefits

Benefits in the Gum Arabic value chain are derived through access to the natural resources
(trees), access to family labour and access to capital and markets. The various groups of actors
involved in the Gum Arabic chain use different mechanisms to control and maintain benefits
derived from sale of the product, as described below:

Tribal Leaders: Tribal leaders have direct control over the gum-producing forested
areas. They have the traditional right to regulate gum production in terms of
allocation of land with trees within the boundary of the village or in the area under
their responsibility. This means that they also have the right and the ability to limit
access of those who do not belong to their group. The relationship between the tribal
leaders and the producers is not clear, but it appears from close investigation with a
28
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

producer in Boro market that the tribal leaders collect a kind of resource “rent” from
producers for the resource use. The amount they collect depends on the productivity
and accessibility of the gum production areas. It is not clear, however, how the
resource rent that is collected by tribal leaders is used or distributed in the
community.
Producers: Producers who have no property rights gain access to the forest through
permits from tribal leaders. The producers establish relationships with village
traders, so as to access credit to pay for initial investments in the production process,
including food and tools.
Village traders: Village traders have access to markets and market information.
Collection and distribution of Gum Arabic at rural markets needs moderate financial
capital to pay for the product and sacks (bags) to pack it in. Village traders and
middlemen have access to capital in the form of credit from town traders and agents.
Traders in most cases borrow money on behalf of producers, and therefore those
producers have to sell their products to them. They also have social ties with
producers and town traders as a result of their social identity.
Town traders and agents: Town traders and agents have access to capital and have
knowledge of the quality requirements of exporters due to their access to exporters
and their agents. Higher amounts of capital are invested at the town traders' and
agents' level for cleaning and packing. They also spend more because they purchase
the product in bulk. Town traders use credit arrangement mechanisms and strong
social ties with village traders to maintain their access to benefits.
Forests National Corporation (FNC): The FNC charges traders’ fees and royalties
when they transport gum from rural and urban markets. As of 2016, the FNC collected
16 SDG/guntar from those transporting the gum outside East Darfur.
Government offices: The various government offices charge taxes and other local
duties like zakat, state fees and truck departure fees. The responsible government
offices do not keep data on the taxes and local duties collected in each locality,
however.

Table 9 presents a summary of the mechanisms of access maintenance and control used by the
various actors along the gum value chain, as identified in the study.

29
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Table 9: Mechanisms for maintaining and controlling benefits

Actor Mechanisms

Tribal leaders Control over access to forests

Traditional and conventional customary right

Producers Access to labour

Social relations for tapping trees (nafir)

Family labour
Village traders Maintenance of access to producers and town
traders/agents

Financial credit arrangements (borrowing and

lending)
Social identity
Town traders/agents Maintenance of access to exporters and village traders

Payment arrangements
Credit arrangements (advance loan)
Access to capital
Social identity
Knowledge of quality standards
Market information control
Forests National Corporation Control the transportation of gum
(FNC)
Charging fees

4.4 Constraints and bottlenecks

When asked what the main constraints and bottlenecks that they faced were, all of the producers
listed low gum prices and lack of market information. Almost all listed the lack of a producers’
organization (95 per cent), lack of financial credit (92 per cent), lack of training on gum tapping
and drying (90 per cent) and lack of drinking water (90 per cent), while over three quarters (78
per cent) listed low regeneration capacity of the Hashab tree. Almost a third (30 per cent) of the
producers listed inadequate fire lines and stand management (Table 10).

30
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Table 10: Constraints and bottlenecks, as identified by producers

Constraints/bottlenecks % of producers (n=130)*

Low gum prices 100

Lack of market information 100

Lack of producers organization 95

Lack of financial credit 92

Lack of training on tree tapping and gum cleaning and drying 90

Lack of drinking water 90

Low regeneration capacity of Hashab trees 78

Poor tree resource management 30

*Figures add up to more than 100% as each gum producer mentioned multiple constraints and
bottlenecks.

Producers’ profits are affected by the lack of market information and lack of capacity to use
such information when available. Some producers are aware that processed gum attracts higher
prices and are aware of market requirements but they lack processing skills and preservation
equipment. Furthermore, they are unable to transport their gum to markets that offer potentially
higher prices and do not have sufficient power to convince the traders and the processing
companies to pay higher prices for raw gum.

From direct observations in the field it was clear that roads to connect the production areas with
markets are poor and in many cases do not exist. Most production areas are remote, so
producers cannot reach markets to trade their gum. Long distances and a lack of roads increase
transportation costs, which make the gum market chain associated with high costs and
ultimately make the chain unattractive to many actors. A fundamental prerequisite for enterprise
growth is public goods, such as roads and infrastructure.

In summary, based on the constraints and bottlenecks listed by the gum producers, the basic
assets needed by gum producers can be divided into three categories:

Natural assets (trees, drinking water)

Human assets (capacity building, skills)
Financial assets (infrastructure, favourable prices, credit)

The assets can be owned by individual actors, communities or entire societies, depending on the
type. For example, a natural asset such as trees may be owned by the state and/or a rural
community. The assets can be seen as stocks or flows. Financial assets, for example, constitute
a stock when held as credit for Gum Arabic activities or a flow when used for establishing gum
trees (a natural asset).
31
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Flows across the different types of assets are important as they can lead to positive feedback
loops (the building of one asset leads to the building of another), but flows can also lead to asset
erosion (the loss of one asset induces the loss of others). An example of a positive feedback loop
would be the building of human assets through training the rural gum producers in gum drying,
cleaning and sorting to help increase the value of their product and raise their incomes. A
negative feedback loop could be caused by low regeneration capacity of gum trees and a lack of
drinking water (loss of natural assets) that erodes income generation (a financial asset). Another
example of a feedback loop is the acquisition of market information by rural gum producers (a
human asset), which helps obtain higher prices and incomes (financial assets).

32
 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

5. Conclusions and recommendations

5.1 Conclusions
Gum Arabic is a high value commodity in East Darfur with great economic importance in rural
areas. It generates incomes for a number of actors engaged in producing, cleaning and trading
the product.

Analysis of the network of actors (producers, village traders, urban traders and agents) and of
the distribution of profits highlights the socially-embedded nature of the value chain and the
complex links between the various processes taking place at the rural level. The empirical results
of this investigation show that downstream actors (traders and companies) are the main
beneficiaries from commercial trade in Gum Arabic from East Darfur. These actors deal with
larger quantities and earn higher incomes. The analysis of the value chain for Gum Arabic
indicates that resource property rights are not the only mechanism for accessing profits from
trade in this product.

Despite the legitimate right of the producers to benefit from gum production and trade, their
access to profits is weak. Producers receive fewer benefits than other actors in spite of their
immense work and dominant role in the value chain of the product. Gum production and trade is
much more profitable for agents and processing companies. However, while increasing the price
of gum at the producer level may be beneficial to producers, the traders, agents and companies
bear relatively higher levels of risk due to their larger capital investments in a context of
fluctuating market prices.

The study found that producers lack training on gum post-handling activities and lack access
to drinking water, market information and financial credit. They also lack organization, so do not
have the ability to negotiate, as a group, with buyers, and cooperate in terms of, for example,
prices, and do not undertake group activities such as sharing the costs of transporting their
product to distant markets.

If producers were able to get access to credit for their initial investment in gum production, they
would have more control over the prices they receive for their product and their profits would
increase tremendously. In addition, value added processing at the local level has high potential
to increase the profits of the producers. Primary processing requires training on processing and
gum standardization measures, processing and preservation equipment, and access to credit.

Economic opportunities for upstream actors do not necessarily translate into incentives to train
producers on how to tap and manage their trees sustainably. However, securing higher profits
could motivate actors to think about sustainable management of natural resources. This would
also help to ensure steady supply of the product and maintain the competitiveness of the sector.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

5.2. Recommendations
The recommendations presented here are those that are considered to potentially have the
highest impact on the development of the Gum Arabic value chain during the "UN Environment
Project" (Natural Resource Management for Sustainable Livelihoods) in East Darfur.

A necessary step in developing the Gum Arabic value chain is to ensure the producers have
access to the basic assets they need and that producers are empowered. Furthermore, the key
natural resource, the gum producing trees, should be managed sustainably.

The recommended interventions for each particular constraint are presented in Table 11, along
with the goals of each intervention, the relevant stakeholders to be involved and the roles of each.

Table 11: Recommended interventions in response to particular constraints and bottlenecks

Constraint/ Recommended Relevant

Goal Roles
bottleneck intervention stakeholders

Financial and technical

support; undertake
State
groundwater surveys and
government
establish groundwater maps;
Drinking
conserve water resources.
Lack of Establish water is
drinking drinking water available to Support water resource
water points. gum conservation; conflict
Tribal leaders
producers. resolution; coordination
between water users.

Provide technical and

NRM Project
financial support.

Provide training on gum

FNC
Lack of Gum drying, cleaning and sorting.
Build the
training on producers
capacity of Support the application of the
gum drying, have skills Tribal leaders
gum skills in the field.
cleaning, in gum
producers.
and sorting processing. Provide financial support for
NRM Project
training workshops.

Lack of Gum Make chain relationships

market Develop Formal producers' more stable; improve access
information market markets are associations to information.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

Constraint/ Recommended Relevant

Goal Roles
bottleneck intervention stakeholders

information in Improve access to

systems. operation. Government information via media, mobile
SMS, etc.

Provide rural Banks,

Long-term
Lack of gum development
credit is Offer long-term financial
financial producers with organizations,
available to credit.
credit long-term state
producers.
credit government

Produce seedlings; transplant

Community
seedlings; follow up related
members
activities in the field.

Secure land ownership; land

conflict resolution; coordinate
Support rural Tribal leaders
Low Gum is communities and other
communities
regeneration harvested actors.
to establish
capacity of from
community- Provide suitable extension
Hashab Hashab FNC
based Hashab services; training; tree seeds.
trees stands.
stands
World Food Provide food for work in the
Programme nursery and the field.

Provide financial support for

NRM Project establishing nurseries and
tools.

Successful implementation of these interventions for developing the Gum Talha value chain in
East Darfur requires the collaboration of all related stakeholders, including NGOs, the state
government, tribal leaders, the FNC, and United Nations organizations (UN Environment, WFP,
etc.). The participation by all stakeholders will ensure all roles are undertaken, and the
interventions will be accepted and successfully implemented. Moreover, active participation and
commitment from the relevant stakeholders in the interventions will enable the gum actors
themselves to understand and own the Gum Talha value chain development process and
initiatives to establish forest stands after the phase-out of the "Natural Resource Management
for Sustainable Livelihoods" project in East Darfur.

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 Gum Talha (Acacia seyal) Value Chain Analysis in East Darfur, Sudan

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