An analysis of the Sorghum-based opaque value chain in Zambia

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Adwoko, Faith M.
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University of Zambia
Sorghum is a grain crop well adapted to intermittent drought and largely grown in Africa. Four marketing channels identified for it include: food processing; beer brewing; feed processing and energy production. A large proportion of sorghum processed in Africa goes into opaque beer processing. A detailed view of the sorghum opaque beer value chain is looked at in this study using Porter's model of value chain analysis. This was done through: an assessment of the key players, their functions and the value added at each stage; establishing the amount of locally produced sorghum entering the chain and; identifying rules and regulations as well challenges and opportunities faced by the actors in the chain. The results showed that the main stakeholders in the chain are the breweries who manufactured the product; the distributors who took up the role of transportation of the opaque beer from the breweries to the retailers and; the retailers who in their outlets sold the beer to the end consumers and also provided sources of entertainment. The traders and small scale farmers played a smaller role in the chain in comparison to the main stakeholders, supplying only 24 percent of the 850.4 metric tons of the sorghum malt used in the industry, while 74 percent came from South Africa and 1 percent from Mozambique. It was noted that the breweries produce an approximate total of 60,434,320 Litres of opaque beer in a year, of which 55,102,320 litres is sorghum-based opaque beer and 5,332,000 is opaque beer without sorghiun. Gross margin analysis revealed that the breweries exhibited the highest margins for the different types of opaque beer i.e. packaged sorghum opaque beer - K2068/L of output, unpackaged sorghum opaque beer - K372/L of output and unpackaged sorghum opaque beer - K492/L of output. The most common product sold by both distributors and retailers was Shake Shake produced by National Breweries. Vertical and horizontal linkages in the chain were all strong with the exception of the horizontal linkages for breweries. Most of the rules and regulations in the industry deal with hygiene and price setting by breweries. The major challenges faced by almost all actors of the chain, i f not all, that should be addressed include poor information flow in the chain and delays in distribution. The opportunities of this chain include improved quality through sorghum use and expected growth in the industry. It is recommended that a commodity broker or bulking point be established that channels sorghum or malted sorghum from the small holder fanners to the breweries. A lesson on how to do this could be learnt from Pence Brewery that obtains its sorghum locally and contributions from the other breweries in the chain. It is also recommended that a forum should be created to improve horizontal linkages for breweries and enhance flow of information and access to technology, thereby boosting the productivity o f the chain as a whole.
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Sorghum , Sorghum-Zambia-Utilization , Brewing-Zambia