Value Chain Analysis of Eucalyptus Wood Products in the Blue Nile Highlands of Northwestern Ethiopia

Amare Tesfaw, Feyera Senbeta, Dawit Alemu and Ermias Teferi
Additional contact information
Amare Tesfaw: Department of Agriculture Economics, College of Agriculture and Natural Resources, Debre Markos University, Debre Markos, P.O. Box 269, Ethiopia
Feyera Senbeta: Center for Environment and Development Studies, Addis Ababa University, Addis Ababa P.O. Box 1176, Ethiopia
Dawit Alemu: Bilateral Ethio-Netherlands Effort for Food, Income & Trade Partnership (BENEFIT), Addis Ababa P.O. Box 88, Ethiopia
Ermias Teferi: Center for Environment and Development Studies, Addis Ababa University, Addis Ababa P.O. Box 1176, Ethiopia

Sustainability, 2021, vol. 13, issue 22, 1-25

Abstract: Eucalyptus wood products contribute significantly to the income of smallholder growers in many parts of Ethiopia. This has incentivized smallholders to convert arable lands to Eucalyptus plantation. Given the limited attention and availability of empirical evidence, this study examined the Eucalyptus wood products value chain in terms of the actors engaged, the type and importance of channels, margins analysis and the overall value chain governance in the main Eucalyptus growing areas of the Blue Nile highlands of Northwestern Ethiopia in 2019/2020. Sources of data were randomly selected 388 Eucalyptus grower households and 166 Eucalyptus wood traders, complemented by an interview with key informants, group discussions and direct observations. The results reveal that a total of 2,051,114.75 m 3 of Eucalyptus wood was produced in the study area and Eucalyptus plantations are expanding over crop lands at a rate of 102.35 ha a year on average. Many actors involved handle a large volume of wood in eight main channels with a high disparity in the shares of the margins. We found that Eucalyptus is the main source of cash earning, contributing about 45.76% to the total annual income of smallholder growers. Little policy attention, a lack of sectoral integration, missing infrastructure and an absence of modern wood processing factories are among the key challenges impeding the performance of the wood sector value chain. There are however existing opportunities for the development of the wood sector value chain such as favorable growing conditions and the spectacular growing demand for wood products. The study provides valuable insights about the wood sector value chain and actions towards ensuring sustainable value chains and the commercialization of the sector.

Keywords: Eucalyptus globulus; Eucalyptus wood products; governance; smallholder growers; sustainable value chain; wood processors (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
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