Value chain analysis of potato in Bajhang district, Nepal

Abstract

The study was conducted in the Bajhang district from February to July 2022. Its goals were to find the key actors in the potato value chain, assess their linkage, analyse marketing margins, determine the share of value-addition among each actor, evaluate the production cost, productivity, and profitability of producers, examine the producer’s share in consumer rupees, and conduct a SWOT analysis. The data collection process involved the random purposive sampling technique to select a total of 80 potato producers, 5 aggregators, 5 wholesalers, 10 retailers, 50 consumers, and 3 extension service providers. Findings revealed that, on average, potato cultivation covered 0.215 hectares (4.23 Ropani) with a productivity of 13.46 Mt/ha, which is lower than the national average. The production cost of the producer was NRs. 301,756.60/Ha (NRs. 15,356.57/Ropani) with a benefit-cost ratio of 1.37, and the producer’s share was 51.68%. The primary value chain actors included input suppliers, producers, aggregators, wholesalers, retailers, and consumers. Marketing margins for producers, aggregators, wholesalers, and retailers were NRs. 359.25/quintal, NRs. 965/quintal, NRs. 945/quintal, and NRs. 1170/quintal, respectively. Value addition by potato producers accounted for 10.45%, while aggregators, wholesalers, and retailers contributed 28.05%, 27.48%, and 34.02%, respectively. The SWOT analysis highlighted opportunities like favourable policies, subsidies, processing options, rising potato demand, and potential production area expansion. To boost the profitability of the potato industry, it is imperative to address challenges such as poor seed quality, diseases-pests, drought, short shelf life, soil degradation, and fertilizer and pesticide availability while strengthening the linkage of value chain actors.