Ginger value chain analysis: A case of smallholder ginger production and marketing in hills of central Nepal

Bhishma Raj Dahal*, Swodesh Rijal
Faculty of Agriculture, Agriculture and Forestry University, Rampur, Chitwan, Nepal (Manuscript received 22 October 2019; accepted for publication 30 January 2020)

Abstract. Having high export potential and profitable to farmers, Ginger is an important spice crop of hills of central Nepal; however, ginger farmers continue to experience low productivity and were forced to share large profit with unscrupulous traders; further, they are traumatized by fluctuation of price and other problems. In this context, a study was undertaken in Sindhuli, a part of Central Nepal for analyzing value chain of ginger. A pretested semi-structured questionnaire was administered among 120 randomly selected farmers and 10 traders involved in ginger enterprise for the past two years. A face-to-face interview was scheduled to obtain data during October-November, 2018. Compound annual growth analysis revealed that area, production and yield of ginger were increasing at the rate of 1.73%, 1.65% and 0.95%, respectively, over the last seven years and price of ginger, over the past thirteen years, increasing at the rate of 3.28%. Value chain analysis revealed that producer, traders (wholesaler and exporter), retailer and consumer were the major actors involved. Farmers received substantial margin – 55% of the retail price, but the rest of the profit was shared to unscrupulous traders. B/C ratio of ginger farming in the study area was 2.42 revealing that ginger farming was a profitable business; with investment of Rs1.0 (0.0088US$) in ginger, farmers earned additional 1.42 rupees. Low productivity of ginger in the research area was caused by severe incidence of rhizome rot. In addition, price fluctuation, lack of processing and storing infrastructure, timely unavailability of rhizome seed, paucity of improved variety, and lack of farmers’ knowledge on improved cultivation practices were the major constraint of ginger farming. Overall, our study points out that solving the constraints, accessing new market, and organizing co-operatives are crucial for sustainable value chain development.