COVID-19 AND ITS IMPACT ON THE PROFIT OF MANGO VALUE CHAIN ACTORS IN SOUTHERN GHANA BY KETADZO BRIGHT (10523135) THIS THESIS IS SUBMITTED TO THE UNIVERSITY OF GHANA, LEGON IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF MASTER OF PHILOSOPHY DEGREE IN AGRIBUSINESS DEPARTMENT OF AGRICULTURAL ECONOMICS AND AGRIBUSINESS SCHOOL OF AGRICULTURE COLLEGE OF BASIC AND APPLIED SCIENCES UNIVERSITY OF GHANA, LEGON DECEMBER, 2022 University of Ghana http://ugspace.ug.edu.gh i ABSTRACT This study assessed COVID-19 and its impact on the profitability of mango value chain actors in southern Ghana. Specifically, the study sought to analyze the governance structure and linkages that exist in disseminating market information along the mango value chain, examined the determinants of marketing outlets used by the value chain actors (producers, distributors and processors), analysed the impact of COVID-19 pandemic on the profit of value chain actors and also analyzed the various factors constraining the mango value chain in Ghana. Data was collected with a well-structured questionnaire from 240 respondents consisting of 150 farmers, 60 distributors and 30 processors in Greater Accra, Eastern and Volta regions of Ghana. Panel data for 2019 and 2020 production season was obtained from these actors. Social Network Analysis (SNA), multinomial logistic regression, difference in difference and Kendall’s Coefficient of Concordance models were used to analyze the various specific objectives whilst using STATA 14 software. Retailers and FBOs were identified to be the most influential and prominent nodes respectively in disseminating market information within the value chain. FBOs were found to be the main bridging nodes in the network. Farm size, FBO membership, quantity produced, reliable customers and gender were found to be the key determinants of mango producers marketing outlet decisions. Ownership of transport, reliable customers, number of buyers and higher price were the key factors influencing the choice of marketing outlet by distributors. Mango processors are heavily influenced by higher prices and gender in choosing their marketing outlet. The outbreak of COVID-19 disease had a negative impact on the profit of mango producers and distributors while processors had positive impact of COVID-19 on their profit. The most pressing constraints confronting the mango producers, distributors and processors include incidence of pests and diseases, post-harvest losses and poor quality of mango fruit respectively. The study concluded that within the value chain retailers and FBOs are the major sources and receivers of market information respectively. Mango producers and distributors experienced a decline in their profit as a result of COVID-19 pandemic while processors profit increased during the COVID-19 pandemic. The study recommends that FBOs and retailers should be central and key stakeholders in policy development for the distribution of market information in the mango sector. Ministry of Food and Agriculture (MoFA) at the district level should encourage mango farmers to increase their farm size and join cooperatives, and distributors should be encouraged to own transport facility to aid in transportation of the fruits to maximize their profits during an exogenous situation like COVID-19 pandemic. MoFA together with Tree Crop Authority should provide mango farmers with the necessary market information and agrochemicals to fight the incidence of pest and diseases like Bacteria Black Spot disease on their farm to produce good quality fruits that are not vulnerable to post-harvest losses. University of Ghana http://ugspace.ug.edu.gh ii DEDICATION This piece of work is dedicated to the Almighty God, my late brother Cephas Kwadwo Ketadzo, Angel Ernest Ketadjo, my mother Comfort Abla Dorglo and loved ones. University of Ghana http://ugspace.ug.edu.gh iii DECLARATION I, Bright Ketadzo, the author of this thesis, “COVID-19 AND ITS IMPACT ON THE PROFIT OF MANGO VALUE CHAIN ACTORS IN SOUTHERN GHANA” do hereby declare that but for the references which have been duly cited, the work presented in this thesis was done entirely by me. This work has never been presented either in whole or in part for any other degree of this University or elsewhere. University of Ghana http://ugspace.ug.edu.gh iv ACKNOWLEDGEMENTS My greatest acknowledgement is to the Almighty God for His special grace, mercy, and favour since my primary education up to this level. My sincere gratitude goes to my major supervisor, Rev. Dr. Edward Ebo Onumah for his corrections, encouragement, support, advice and tirelessly and critically examining my scripts with constructive suggestions and very significant comments which shaped the content of this work. Also, I would like to appreciate the contribution of Dr. (Mrs.) Abigail Ampomah Adaku for her comments and suggestions in varying this thesis. I would like to appreciate all senior members who made corrections and suggestions during the seminar and oral presentations of this work. A special thanks go to all the institutions contacted such as MoFA, GEPA, exporters, MoTI, UG, CSIR, and the hard-working mango farmers, distributors, processors and consumers for the relevant information provided for this piece of work. I am extremely thankful to the Agricultural Trade and Market Access for Food Security (ATMA4FS) project for awarding me a thesis grant for the data collection and a monthly stipend. I gratefully acknowledge Dr. (Mrs.) Justina A. Onumah of CSIR, STEPPRI for her support and assistance with respect to the network analysis model. Similarly, my sincere thanks go to Mr. Prince Addey for his technical support and assistance during data collection all through to data analysis. Finally, I would like to thank my wonderful family and friends, especially Comfort Abla Dorglo for their continuous encouragement, prayers and support. God richly bless you all. University of Ghana http://ugspace.ug.edu.gh v Table Contents ABSTRACT ......................................................................................................................... i DEDICATION .................................................................................................................... ii DECLARATION ............................................................................................................... iii ACKNOWLEDGEMENTS ............................................................................................... iv LIST OF ABBREVIATIONS ............................................................................................. x CHAPTER ONE ................................................................................................................. 1 INTRODUCTION .............................................................................................................. 1 1.0 Background ............................................................................................................... 1 1.1 Problem Statement .................................................................................................... 5 1.2 Research Questions ................................................................................................... 7 1.3 Research Objectives .................................................................................................. 8 1.4 Significance of the Study .......................................................................................... 8 1.5 Organisation of Study................................................................................................ 9 CHAPTER TWO .............................................................................................................. 11 LITERATURE REVIEW ................................................................................................. 11 2.0 Introduction ............................................................................................................. 11 2.1 The Mango Sector in Ghana.................................................................................... 11 2.2 Trends in Production, Import and Export Value of Mango from Ghana ................ 13 2.3 Marketing in Ghana ................................................................................................. 15 2.3.1 Types of Marketing Outlets .............................................................................. 16 2.3.2 Mango Marketing Outlets in Ghana ................................................................. 16 2.3.3 The Roles of a Marketing Outlet Within a Value Chain .................................. 18 2.4 Constraints in the Mango Sector in Ghana.............................................................. 19 2.4.1 Production Constraints: .................................................................................... 19 2.4.2 Marketing and Distribution Constraints ........................................................... 20 2.4.3 Processing Constraints ...................................................................................... 21 2.5 The Concept of Value Chain ................................................................................... 21 2.5.1 The Global Value Chain ................................................................................... 23 2.5.2 Value Chain Analysis ....................................................................................... 24 2.5.3 Approaches to Value Chain Analysis ............................................................... 26 2.5.4 Value-Added Product ....................................................................................... 28 University of Ghana http://ugspace.ug.edu.gh vi 2.5.5 Mapping the Value Chain ................................................................................. 28 2.5.6 Value Chain Upgrading .................................................................................... 30 2.5.7 Value Chain Governance .................................................................................. 31 2.6 Supply Chain Concept ............................................................................................. 32 2.7 Performance Analysis ............................................................................................. 34 2.7.1 Social Network Analysis (SNA) and Market Information Access ................... 34 2.7.2a Impact Assessment ......................................................................................... 37 2.7.2b COVID-19 and its Impact on the Mango Value Chain .................................. 38 2.7.3 Multinomial and Logistic Regression............................................................... 40 2.8 Empirical Review .................................................................................................... 41 2.8.1 Value Chain Assessment .................................................................................. 41 2.8.2 Social Network Analysis (SNA) Approach ...................................................... 42 2.8.3 Impact of COVID-19 on Agriculture and Livelihood ...................................... 44 CHAPTER THREE .......................................................................................................... 48 METHODOLOGY ........................................................................................................... 48 3.1 Introduction ............................................................................................................. 48 3.2 Theoretical Framework ........................................................................................... 48 3.2.1 Random Utility Theory ..................................................................................... 48 3.3 Conceptual Framework ........................................................................................... 50 3.4 Assessing the Governance Structure Along the Value Chain ................................. 51 3.5 Analytical Perspectives ........................................................................................... 52 3.5.1 The Social Network Analysis (SNA) ............................................................... 52 3.5.2 Nature and Contribution of SNA in Access to Market Information ................. 57 3.5.3 Multinomial Logit Model ................................................................................. 58 3.5.4 Difference in Difference Model ....................................................................... 64 3.5.5 Description and Justification for Inclusion of the Independent Variables ....... 68 3.5.5.1 Household Characteristics ............................................................................. 68 3.5.6 Constraints Analysis ......................................................................................... 73 3.5.7 Method of Data Collection ............................................................................... 76 3.6 Study Area ............................................................................................................... 78 CHAPTER FOUR ............................................................................................................. 83 RESULTS AND DISCUSSION ....................................................................................... 83 University of Ghana http://ugspace.ug.edu.gh vii 4.1 Introduction ............................................................................................................. 83 4.2 Characteristics of Respondents ............................................................................... 83 4.2.1 Gender .............................................................................................................. 83 4.2.2 Age.................................................................................................................... 84 4.2.3 Marital Status .................................................................................................... 85 4.2.4 Highest Education Obtained ............................................................................. 85 4.3 Governance Structure .............................................................................................. 86 4.4 Actor Linkages in Disseminating Market Information in the Mango Value Chain 87 4.5 Actor Centrality Measures in the Access to Market Information ........................... 90 4.6 Multinomial result for Mango Producers (Farmers) ............................................... 93 4.7 The Impact of COVID-19 on Profit of Mango Value Chain Actors ..................... 104 4.7.1 Profit earned by the mango actors between 2019 and 2020 ........................... 104 4.7.2 The Impact of COVID-19 on the Profit of Mango Mango Value Chain Actors ................................................................................................................................. 107 4.7.3 The Covariate for Producers, Distributors and Processors ............................. 110 4.8 Constraints of Actors along the Mango Value Chain ........................................... 115 4.8.1 Constraints of Mango producers ..................................................................... 115 4.8.2 Constraints of Mango Distributors. ................................................................ 118 4.8.3 Constraints faced by mango Processors ......................................................... 121 CHAPTER FIVE ............................................................................................................ 125 SUMMARY, CONCLUSION AND RECOMMENDATION ....................................... 125 5.1 Introduction ........................................................................................................... 125 5.2 Summary and Major Findings ............................................................................... 125 5.3 Conclusions ........................................................................................................... 127 5.4 Recommendations ................................................................................................. 129 REFERENCES ............................................................................................................... 132 University of Ghana http://ugspace.ug.edu.gh viii LIST OF TABLES Table Page Table 1: Socio-Demographics of the Respondents 84 Table 2: Governance in Mango Value Chains 86 Table 3: SNA Centrality Measures of the Value Chain Actors 91 Table 4: Multinomial Regression Result for Mango Producers 94 Table 5: Multinomial Regression Result for Mango Distributors 99 Table 6: Multinomial Regression Result for Mango Processors 103 Table 7: Profit earned by the mango actors between 2019 and 2020 105 Table 8: DID Estimate Results for Mango Mango Value Chain Actors 109 Table 9: Covariates that Impacted Mango Value Chain Actors Profit 111 Table 10: Constraints Faced by Mango Producers 116 Table 11: Constraints Faced by Mango Distributors 119 Table 12: Constraints Faced by Mango Processors 122 University of Ghana http://ugspace.ug.edu.gh ix LIST OF FIGURES Figure Page Figure 1: Trends in Volume Production of Mango 13 Figure 2: Import and Export Value of Mango from Ghana 15 Figure 3: Mango Value Chain Actors, Functions and Existing Linkages 29 Figure 4: Conceptual Framework 51 Figure 5: The map of the Study area (Eastern, Greater Accra, and Volta Region) 80 Figure 6: Mapping Stakeholders in the Dissemination of Market Information within the Mango Value Chain 88 University of Ghana http://ugspace.ug.edu.gh file:///C:/Users/Bright/Desktop/Bright%20Backup/DR%20ONUMAH/Bright's%20work/Work%20here/Bright%20work%202a1.(FINAL%20WORK).docx%23_Toc122429522 x LIST OF ABBREVIATIONS ATMA4FS Agricultural Trade and Market Access for Food Security EU European Union FAGE Federation of Associations of Ghanaian Exporters FAO Food and Agriculture Organization FBO Farmer Based Organization GEPA Ghana Export Promotion Authority GDP Gross Domestic Product GLOBALGAP Global Good Agricultural Practices GVC Global Value Chain GHS Ghana cedis GSA Ghana Standard Authority HACCP Hazard Analysis and Critical Control Points MoFA Ministry of Food and Agriculture MoTI Ministry of Trade and Industry NGOs Non-Governmental Organization SNA Social Network Analysis TCDA Tree Crop Development Authority UNICEF United Nation Children’s Fund UNIDO United Nations Industrial Development Organization USAID United States Agency for International Development WFP World Food Programme University of Ghana http://ugspace.ug.edu.gh 1 CHAPTER ONE INTRODUCTION 1.0 Background The novel coronavirus disease (COVID-19) began in China and is moving across continents and a total of about 267,038,727 COVID-19 cases have been recorded and out of these cases about 5,282,803 death cases have been reported by 222 countries and territories (Worldometer, 2020b; Schotte et al., 2021). These include cases from both developed and developing countries. Globally, the case count of coronavirus keeps increasing by the day and possess a lot of fear and threat to human life and livelihood. According to the World Food Programme (WFP, 2020), the mortality rate is roughly 3.5 percent, with people over 60 and those with pre-existing health concerns having the highest risk of severe sickness and death. Apart from being a worldwide health risk, Gupta et al. (2020) predicted that the COVID-19 pandemic could pose a significant threat to the global economy, potentially lowering global GDP growth by reducing the percentage score in 2020 (from 2.9 percent to 2.4 percent). After taking counts of the impact the virus has caused in China, Italy, South Korea, France, and other neibouring countries that were early-affected, a lot of these countries have adopted measures to limit the spread of the virus which include: travel restrictions, a ban on public or social gatherings like funerals, weddings, parties, the closure of schools and churches, movie theatres, museums and gyms, and restrictions on opening hours, or closure of restaurants, bars and shops and restrictions on the movement of cargo trucks among others. In most countries, agricultural productivity and distribution may be severely harmed as a result of these steps to contain and treat the COVID-19 outbreak. University of Ghana http://ugspace.ug.edu.gh 2 The effects vary depending on farming practices or methods, and the extent of exposure in some countries. Because most agricultural activities are seasonal and weather-dependent, a delay in one activity could have an impact on the production process altering yields and as a result, distribution channels or outlets. Containment efforts that restrict mobility and raise corporate costs due to constrained supply chains and market information access and credit limitations have had an impact on economies, resulting in a slowdown in economic growth (Nouh et al., 2020; Siche, 2020). These measures are exerting unprecedented recession on agriculture and the world's economy, which is rapidly deteriorating (Mishra & Rampal, 2020). As of June 23rd, 2020, 100 days after the novel virus (SARS COV 2 or COVID-19) was announced, Ghana had 14,568 cases, 10,907 of which had been declared recovered, and 95 of which had been officially certified dead (Amponsah et al., 2021; Sarpong & Obeng, 2021). So far, the disease pandemic has wreaked havoc on the economy and hampered value chain prospects, with several countries still struggling to recover. It can be observed that the outbreak takes a direct toll on the health and movement of value chain actors from input suppliers (farmers) and the final consumers. With producers (farmers) not exempted, one can say that the disease does not only impede the ability of the farmer to produce for others but also undermines their food security and livelihood. Since agriculture, for that matter fruits and vegetable production, processing and distribution is a labour-intensive venture which relies extensively on temporary or seasonal labourers or workers, a lack or a delay of supply of farm produce and its added value produce affects activities and actors along the value chain who depend on this fresh produce or added value product from rural or remote areas to urban centres. During the lockdown, the closure of restaurants, 'chop-bars,' and roadside vendors, for example, disrupted market outlets for farmers, resulting in a drop in income. Farmers' access to input and output markets and accessibility of University of Ghana http://ugspace.ug.edu.gh 3 market information were limited due to transportation disruptions and lockdown measures (Gray, 2020; WFP, 2020). Mango (Mangifera indica) is a vigorous growing tree that is believed to have originated from Malaysia (Iheji, 2016). Mango is considered as one of the healthiest fruits in the world and a major crop in tropical and subtropical countries (Krishnan et al., 2009). Mango is a delicate fruit and, therefore, sensitive to transport due to its perishability. However, there is extensive market interest in fresh mango locally and internationally in processed mango - pulp or dried form. Globally, mango is produced in more than 90 countries of which Asia, America, and Africa continent contribute about 77%, 13%, and 9% respectively to the total global production (Evans, 2008; Matheyambath et al., 2016). Mango is noted as one of the few horticultural crops that have a long history of cultivation with an increase in production in more temperate zones using protected cultivars. Matheyambath et al. (2016) mentioned three major mango trade centres globally. This includes the Middle East, European market, and American market. Literature indicates that Asia supplies Middles East, Africa supplies European market while Latin America supplies American and European market. The mango production is a major component of the farming business in the Coastal Savannah, Northern Ashanti, transitional zones of the Ashanti and Ahafo regions, and some parts of the Oti region of Ghana. According to Woldesenbet (2013), mango production served as a major source of income for many households and a major source of livelihood for a large number of middlemen, transporters, and traders. Some varieties of mango cultivated in Ghana are Keitt, Kent, Tommy Atkins, Palmer, Julie, Haden, and Erwin. Ghana has a competitive advantage in the production of fresh mangoes and fruits for export due to its favorable climate for fruit growing and proximity to the European market (Okorley et al., 2014; Boateng, 2016). University of Ghana http://ugspace.ug.edu.gh 4 Mango is mainly made into juices and nectars, as well as canned cheeks, segments, or chunks with syrup added during the canning process. Frozen purées or pulps are used in the making of dairy products (yoghurts, for example), ice cream, and biscuits, and constitute a growing market of chocolate and cereal bars among others. The mango industry in Ghana has a complex market structure brought by different actors in the supply chain whose actions affect the farmer’s production and marketing decisions. The mango business has contributed greatly to Ghana's economy in terms of employment and foreign cash throughout the years due to its logistical advantage for air and sea shipment (Mensah & Brümmer, 2016). Ghana is one of the few countries in the world with two major mango seasons, allowing for a year-round supply of high-quality fruit to the international mango market (Ganry, 2007). The gradual growth of agriculture throughout the country has improved job opportunities for individuals through its forward and backward linkages (i.e. supply of fruit to exporters/agro- industries and demand for inputs/services) to other sectors of the economy (Jaeger, 2008). According to Bellù (2013), value chain analysis is the evaluation of a segment of an economic system in which upstream agents in production and distribution processes are connected to downstream partners through technological, economic, geographical, institutional, and social ties. According to Rangegowda et al. (2016), value chain analysis is defined as the identification of distinct actors and the precise tasks they undertake in production, assembly, processing, wholesaling, retailing, and consumption. The analysis of the chain helps identify and create opportunities for a technological or functional upgrade of the various actors along the value chain as well as identifying the weaknesses associated with any of the actors along the value chain. University of Ghana http://ugspace.ug.edu.gh 5 1.1 Problem Statement Grumiller et al. (2018) reported that there has been a recent decline in the pineapple industry which has imperatively caused an increase in the production of mango which is one of the horticultural crops produced in Ghana. As a result of this positive change in mango production, total production increased to about 110,000 tons which contributes about 0.3% to the country’s GDP. However, Ghana scuffles to increase export and to produce to feed available processing firms all year round due to a myriad of constraints that limits production, marketing, and development of the mango sector. Even though there has been flagship programmes by the government like Planting for Food and Jobs (PFJ) and Planting for Export and Rural Development (PERD) the constraints such as post-harvest losses which stand around 30% (Tanye, 2016), lack of functioning pack houses, limited number of GlobalGAP certified producers, pests and diseases remain unresolved. MoFA (2020) in their Medium-Term Expenditure Framework (MTEF) report for 2020-2023 indicated that there has been significant growth in agriculture as a result of the intensification of agricultural activities over the years especially 2016 and 2017 which yielded an increase in real Gross Domestic Product (GDP) from 2.9% to 6.1% respectively. But GDP recorded in 2018 declined to 4.8%. The Integrated Tamale Fruit Company, for example, assisted farmers throughout-grower schemes and GLOBALGAP certification to enable them produce and export mangoes from Northern Ghana as part of a government-private sector partnership to develop the fruit sector to meet high export and local demand (Okorley et al., 2014). Although mango production and exports have notably increased over the years, the mango sector performance still remained sub-optimal. According to Okorley et al. (2014), the mango industry is faced with several challenges such as unstable market price for fresh fruits, incidence of pests and diseases, lack of capital or credit, lack or inadequate University of Ghana http://ugspace.ug.edu.gh 6 access to market information, and high cost of inputs. For instance, difficulty in accessing and disseminating market information and incidence of pests and diseases among others constrain the production and distribution of fruits in Ghana hence pose a threat to the development of the mango sector. These challenges have been worsened by the outbreak of the COVID-19 disease which imposed a sudden shock on food supply, limited access to market outlets and information, input distribution or supply, production, and marketing hence, the need for market options. Pan et al. (2020) mentioned that the unprecedented measures that were taken during the outbreak of the COVID-19 have hurdled most food supply chains with a reduction in transportation of both raw or processed agricultural products and declined large consumption of perishable foods like fruits (mango) and vegetables as a result of uncertain income. This unprecedented impact of the pandemic on both the demand and supply side of the food chain generally lowers the demand for agricultural products in this COVID-19 era relative to regular seasons. And as a result of these, it is expected that the profit earned in these seasons could be impacted. On the other hand, Bordi et al. (2021) noted that the strict traffic control measures employed in various areas such that products cannot leave the country, raw materials cannot enter in many countries due to the fast-ebbing nature of the COVID-19 virus from region to region and across borders limited access to some marketing outlets, productive resources or inputs and export of agricultural produce. Limited access to some marketing outlets like the export and processing market affected efficient distribution of products like mango fruit from the production points to the market centres. These challenges posed by COVID-19 pandemic affected the profit earned by the mango value chain actors in southern Ghana. Also, Jos (2020) in his policy brief on the Impact of COVID-19 on Value Chains pointed out that the first direction of the impact of COVID-19 is on the value chain actors’ revenue which is a function of their profit. This impact on their profit University of Ghana http://ugspace.ug.edu.gh 7 could be attributed to economic slumps resulting from lockdown measures and the shutdown of businesses or factories during the pandemic. Besides, it is expected that mango value chain actors will choose available marketing outlets that maximise their utility amidst the COVID-19 pandemic. Ghana Statistical Service in partnership with World Bank and UNDP reported that the COVID-19 pandemic hindered access to market information for production, processing, and distribution. Also, financial institutions that support firms and businesses have tightened their loan terms hence, making activities and management of these businesses difficult. According to Badar (2019), the multi-faceted nature of the value chain, not only lowers the value of mangoes to consumers and lowers the income received by value chain actors such as producers and distributors, but also hinders the full potentials of country’s industry and socioeconomic growth. Hence this study seeks to address the following; describe the actors and the relationship that exist between them within the governance structure and access to market information, analyze the determinants of market outlet of the value chain actors and the key constraints facing the actors due to the spread of the COVID-19 disease. 1.2 Research Questions These factors stated above post uncertainties that this research seeks to uncover. The following major research questions may arise: 1. What is the nature of the governance structure and how are stakeholders in the value chain linked in disseminating market information in Southern Ghana? 2. What are the determinants of market outlet decision of the mango value chain actors? 3. How does the outbreak of the COVID-19 pandemic impact the profit of the mango value chain actors? University of Ghana http://ugspace.ug.edu.gh 8 4. What are the various constraints affecting the mango value chain in Southern Ghana during the COVID-19 pandemic? 1.3 Research Objectives The main objective of the study is to analyze the COVID-19 and its impact on the profit of mango value chain actors in Southern Ghana. The specific objectives of the study are: 1. Identify and explore the linkages that exist in disseminating market information within the mango value chain in Southern Ghana. 2. Identify and analyze the determinants of mango value chain actors’ market outlet choice decisions. 3. Analyze the impact of the outbreak of the COVID-19 pandemic on the profit of mango value chain actors in Southern Ghana. 4. Identify and examine the various constraints facing the mango value chain in Ghana during the COVID-19 pandemic. 1.4 Significance of the Study By reviewing existing literature on mango production in Ghana, this study provides a holistic picture of existing linkages in disseminating market information in the mango value chain especially in this era of the COVID-19 pandemic. In addition, the study provides information on the trends in mango production, export, and import and the determinants of market outlet choice decision of value chain actors in southern Ghana. The information provided is expected to help the value chain actors identify the explorable outlets that could maximise their profit or utility. University of Ghana http://ugspace.ug.edu.gh 9 Furthermore, the study will provide information on the impact of COVID-19 on the profit of value chain actors in the mango sector. The information that will be detailed in this study will enable research and development organizations, traders, producers, policymakers, extension service providers, government and non-governmental organizations, in evaluating their activities and redesigning their modes of operation to navigate through COVID-19-like situations with minimal disruption, and ultimately influence the design and implementation of policies and strategies amidst the crisis. Finally, the study seeks to highlight the major factors constraining the development of the mango value chain sub-sector and provide recommendations to deal with them. This is envisaged to better improve the production and processing of mango at a larger scale to bring about economic development in Ghana. 1.5 Organisation of Study This study is grouped into five main chapters. The Chapter one is the preliminary chapter which details the background of the study, the problem statement leading to the research questions, the various objectives of the study, as well as the significance of the study. Chapter two expounds relevant literature on the mango sector in Ghana, trends in production, import and export of mango from Ghana, constraints in the mango sector in Ghana, marketing of mango, value chain and its analysis, value chain upgrade, governance structure, mapping the value chain actors, supply chain concept, COVID-19 and its impact on mango value chain actors, market information access, a brief history on social network analysis, and finally, empirical review. The methodology section of Chapter three outlines the numerous analytical tools and methodologies applied to answer the study's research questions. These include the theoretical and conceptual frameworks, the methods of data collection and analysis and ends with the study area. The results obtained are presented and University of Ghana http://ugspace.ug.edu.gh 10 discussed in Chapter Four. Finally, Chapter Five concludes with the summary or major findings, conclusion, and recommendations of the study. University of Ghana http://ugspace.ug.edu.gh 11 CHAPTER TWO LITERATURE REVIEW 2.0 Introduction This chapter presents a review of relevant literature related to this study. It highlights the mango sector in Ghana, the trends in the volume of production, export, and import, constraints facing the mango sector, global value chain, supply chain and value chain concept, marketing channels in Ghana, the impact of COVID-19 on the value chain and finally on empirical results from related studies. 2.1 The Mango Sector in Ghana The mango sector in Ghana is characterized by input suppliers, producers, distributors, and processors. The activities of these actors in the mango sector have contributed to the development of the sector over the years. Mango production in Ghana comprises smallholders and commercial farmers (Boateng, 2016; Baidoo-Williams, 2015). According to Boateng (2016), about 76% of the total area under mango production is owned by commercial farmers and some farmer-based organizations (FBOs) members while the remaining 24% belongs to individual nucleus farmers. Baidoo-William (2015) mentioned that these 24% mango farmers include out growers who produced for centralized plantations who process and or export their produce. The mango sector has attracted the interest of farmers and traders for the last seven years due to the rising demand for mango on the international market (Van Melle & Buschmann, 2013). There are three major mango production zones or belts in Ghana: the southern belt around the capital Accra, the Bono and Ahafo belt, and the Northern belt (Zakari, 2012). Fresh mangoes produced in Ghana have varying destinations which primarily include the rural-urban market of Eastern, Greater Accra, Ashanti, Volta, Central region among others mostly characterized by business University of Ghana http://ugspace.ug.edu.gh 12 activities of wholesalers and retailers as well as export markets for fresh fruit, chiefly to Europe. According to the WACOMP mango cluster diagnostic study report on mango, a large share of about 70% of total production is consumed and given to domestic processing firms. Fruit processing business has expanded into a highly competitive business in Ghana (Van Melle & Buschmann, 2013). According to Abu et al. (2020), the Ghanaian mango industry largely produces the Florida varieties (Haden, Kent, Palmer, and Keitt) as compared to other varieties for fresh and processed mangoes which are traded locally and for export (FAGE/USAID/TIPCEE, 2007). The predominant variety produced in the southern belt as found by this study is Keitt. Several other varieties or cultivars are also recognized commercially but are mainly consumed locally. Due to Ghana’s climatic condition, the above-listed varieties perform well and this has given the mango farmers to produce in large quantities which are consumed locally and are exported largely by both air and sea freights (Abu et al., 2011). This suggests a great potential for farmers who would like to venture into mango production since the mango business seems to be economically viable in Ghana (Boateng, 2016). Abu et al. (2020) noted that it will be a great benefit for Ghana to consider using sea freight for mango export and thus profit from cheaper freight rates and the opportunities to move bigger volumes to the international market. Baidoo-William (2015) highlighted that high volume production of mango in high standards to meet growing demand will help Ghana boost its comparative advantage over other countries and thus obtain a real competitive advantage internationally. In Ghana, mango production is made up of lots of small-scale growers who contribute significantly to overall output and export (Baidoo-Williams, 2015, Van Melle & Buschmann, 2013; Boateng, 2016). According to Boateng (2016), membership of FBOs and dispersed individual farmers own about 76 percent of the entire land under cultivation of mango. Pest and disease outbreaks, poor road conditions, post-harvest losses, limited access to credit, low University of Ghana http://ugspace.ug.edu.gh 13 fruit quality, and land tenure concerns are some of the obstacles the sector continues to face and must overcome to meet both domestic and international demand. 2.2 Trends in Production, Import and Export Value of Mango from Ghana From Figure 1, the volume of production started increasing from 75 thousand metric tonnes to about 99.36 thousand metric tonnes at the end of the 2009 and 2014 production years. This could be linked to an increase in the area of land for mango production over the years. Production kept increasing steadily with a volume of about 99.36 metric tonnes in 2014. Production became a bit stable from 2014 to 2016 and then there was an increase from 99.22 to 112.86 thousand metric tonnes between 2017 to 2019 respectively. An increase in production volume of mango from Ghana gave rise to an increase in export volume from 4760 Mt. to 9405 Mt. from 2016 to 2019 respectively (GEPA, 2020) which are mostly whole fresh or processed of which values generated are represented in Figure 2. Figure 1: Trends in Volume Production of Mango Source: FAOSTAT, 2020 0 20 40 60 80 100 120 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Production Trends of Fresh Mango in Ghana Volume (K Mt) University of Ghana http://ugspace.ug.edu.gh 14 Ghana also deals in processed mango fruits which are in the form of fresh-cut, salads and dried which are exported by processing firms such as Blue Skies, HPW Fresh and Dry, Bomart Company Limited, Prudent Export and Import Company Ltd., Mission Farms Ltd., Volta River Estate Ltd., and Dhillon Farms Ltd among others. According to GEPA (2018) report, major market destinations for Ghana’s mango in 2017 include the United Kingdom (US$22.1 million), Switzerland (US$4.6 million), Germany (US$3.45 million), Italy (US$1.8 million), and France (US$1.8 million). The result shown in Figure 1 reveals that there has been a steady rise in the volume of mangoes exported from Ghana between 2013 to 2015 providing the country with an export value of about US$ 13.93 in 2015. However, the sector saw a decline from 2015 to 2016 with export value dropping from US$ 13.96 to US$ 6.78. This could be attributed to the incidence of pests and diseases especially Bacteria Black Spot (BBS) disease which affected the fruits and eventually reduces the export volume and value (Iddris et al., 2021). Mensah & Brümmer (2016) noted that mango production in Ghana keeps fluctuating thus, restraining the growth of the mango business especially in meeting rapidly increasing export demand. Meanwhile, most farmers increase their farm size to be able to export their mangoes from Ghana. After slumping in 2016, export volume shot up from 4760 Mt. to 9352 Mt. and generated US$ 59.92 million in 2017. Export volume as shown in Figure 1 and export value keeps increasing until 2020 when it dropped to US$ 33.52 million. This sudden and sharp recession of export value could be attributed to the shocks implicated by the outbreak of the COVID-19 virus which resulted in the closure of borders by all export destination countries mentioned earlier together with some endogenous factors such as incidence of pests and diseases, unreliable market and post-harvest losses among others. This is summarized by Ragasa et al. (2021), who mentioned that the COVID- University of Ghana http://ugspace.ug.edu.gh 15 19 pandemic has weakened demand, disrupted most supply chains including the mango supply chain, and rendered the commodity (mango) market in a distorted and uncertain state. Also, Figure 2 presents the import value of Ghana over the years from 2013 to 2020. The result represents an increase in import value from US$ 0.68 to US$ 2.74 million between 2013 and 2017. However, after 2017 it dropped to US$ 2.27 million in 2019 but finally stood at US$ 2.79 million in 2020. The rise in import value of mango in 2020 could be how the country imports fresh mango and its processed products to supplement what is produced domestically especially during the off- season in a bit of boosting consumers immune system against the COVID-19 virus infection. Figure 2: Import and Export Value of Mango from Ghana Source: Tridge (2021) 2.3 Marketing in Ghana Stern et al. (1996) define marketing outlet as a collection of interconnected organizations or an institution that ensures product or service accessibility and availability to consumers. Yadav et al. (2013) define a marketing outlet as the path used in moving goods or commodities from the production centres to the consumption centres or points. It serves as the path or medium through 0 10 20 30 40 50 60 70 80 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Fresh Mango Exports & import From Ghana Export Value in $M Import Value in $M University of Ghana http://ugspace.ug.edu.gh 16 which the product is moved from its producer to the end user or consumer through various auxiliaries such as wholesalers and retailers, who are also known as agents or middlemen. Marketing is primarily concerned with identifying and meeting human and social needs. Gundlach et al. (2009), define marketing as a number of activities, structures, and processes for creating, communicating, distributing goods and services that have value for end users, clients, partners, as well as the entire society. Within the marketing outlets, there are intermediaries whose actions and inactions influence the movement of the product. According to Kotler (2005), the channel decision directly influences the marketing decision of the product concerned. Primarily the local market (wholesalers and retailers), processing firms and export serve as the main outlets for mango in Ghana. 2.3.1 Types of Marketing Outlets Marketing outlets can be grouped into two main types, namely: direct and indirect marketing outlets. Direct marketing outlet occurs when the product or service moves from the producer to the consumer without any intermediary or middlemen involved. It mostly occurs with the sale of services. A marketing outlet is said to be indirect when intermediaries or middlemen are keenly engaged in transferring a product or service to the consumer. This is predominant in the mango sector as compared to direct marketing (Kotler, 2005). The price consumers pay for a product usually increases with an increase in the number of intermediaries in a channel. This is because of the value added to the product by each intermediary. 2.3.2 Mango Marketing Outlets in Ghana According to Boateng (2016), mango consumption occurs largely in places far from where they are being produced. This implies that the mangoes produced have to be moved from places where they are being produced to the point of consumption. As a result, several middlemen or actors are University of Ghana http://ugspace.ug.edu.gh 17 involved in transporting mangoes from the initial point of production to the consumption point, hence providing marketing channel(s) of distribution. Mango marketing outlets in Ghana include the export market, local fresh rural and super markets, processing firms, wholesalers, and retailers (Abu et al., 2011). These outlets serve as the main absorbers of the produce from the mango farmers. The quantity purchased by these outlets differ. Eghan (2017) categorized the local market into three basic categories, namely the local assembly market, farmgate, highway market, and central market. These outlets together with the export market he reinforced as the major marketing outlets of mango. Farm-gate: refers to outlets that buy their produce at the farmstead. These outlets buy the farm produce immediately after harvesting usually in larger quantities. Farmers like the farmgate market because it eliminates the cost of transporting their produce to a marketing center (Eghan, 2017). Local assembly markets: these refer to markets that are organized under huts and sheds and are mostly located within production communities. Aggregators within and near production communities are also included, who travel from one farm to the other and from market to market buying farm produce in smaller volumes, aggregating it, and transferring it to big towns or cities for sale. Highway markets: this is a fast-growing outlet that sells farm produce mostly fruits and vegetables by the roadside especially highways, usually targeting travelers. The accessibility of this market outlet, as well as the fresh nature of the produce sold, are contributing to its increasing trend. Despite the risk involved in selling by the roadside, many of the people selling in this market regard it as a good market avenue for earning some income to better their livelihood (Eghan, 2017). University of Ghana http://ugspace.ug.edu.gh 18 Central markets: Generally, these include wholesale markets located in cities or big communities. Produce in large quantities are different farms are transpoted to these markets for sale. These markets serve as the centre for bulk purchases by different buyers. The processor market: this outlet involves both small-scale and commercial mango processors. This outlet most purchases the mango fruit at the farm gate mostly to avoid post-harvest handling that may affect the quality of the fruit. The mango processors as well as exporters go for fruits with high-grade quality. The export market: this refers to an outlet outside the country of production. This may include farmers and exporting companies who aggregate the farm produce both from their farm(s) and neighbouring farm and then transport it to a foreign market. Most of the mango taken to these outlets are unripe (mature green) but physiologically mature. These outlets serve as the middlemen agents through which the mango fruit passes through before getting to the final consumer (Eghan, 2017). 2.3.3 The Roles of a Marketing Outlet Within a Value Chain A marketing outlet within a value chain performs very vital roles or functions in reaching customers or final consumers with the right product. Thus, the primary objective of a marketing outlet is to provide a connection between production and consumption and to create time, location, and provide utilities that adds to the value of distribution (Usman, 2016). The following are some key functions performed by actors in distribution/marketing outlets. Actors in the channel or outlet make market information available. The actors gather and distribute market research and intelligent information about actors and forces in the marketing environment which helps in planning and facilitating the exchange of goods and services. Also, they perform University of Ghana http://ugspace.ug.edu.gh 19 promotion functions by developing and spreading persuasive communications about an offer or product. Again, they perform functions of matching, contact, and negotiation. Matching is concerned with transforming and fitting the product to the consumer’s needs. It includes grading, sorting, assembling, and packaging. 2.4 Constraints in the Mango Sector in Ghana The mango industry in Ghana faces a myriad of challenges in production, marketing and distribution, and processing. Poor market structure, distance from the market, lack of ownership of transport facility, and inadequate market information are some constraining factors reviewed by Makhura et al. (2001) as the key constraint facing the marketing of smallholder farmers. Credit bound association with buyers coupled with lack of bargaining power made exploitation of farmers easy especially during a transaction where farmers mostly become price takers. Xaba (2013) stressed that the majority of farmers being smallholders and not having a collective voice made it possible to be exploited and to receive unfair prices for their farm produce. Below are constraints that have been reviewed under sub-heading like production, marketing, and processing. 2.4.1 Production Constraints: The production of mango requires a group of inputs which includes land, cutlass, fertilizers, irrigation materials, and packaging. Some constraints farmers face includes high input cost, pest and diseases management, lack of irrigation materials among others (Usman, 2016). In light of these constraints, farmers prefer selling out their mangoes in the fresh states as in the case of most other crops produced in Ghana (Okorley et al., (2014); Karlan et al., 2010). Delay in access to farm inputs such as agrochemicals (fungicides, pesticides among others) and delay in harvesting are some challenges that that affects production such that when there is a little delay in access to University of Ghana http://ugspace.ug.edu.gh 20 these inputs or its application, it results in poor quality, post-harvest losses and low productivity of the fruit. 2.4.2 Marketing and Distribution Constraints Poor road conditions that linked production zones, pack houses to the markets, cold chain facilities (available storage, refrigerated trucks), poor fruit quality, post-harvest losses, and freight costs due to low volumes are among the many constraints identified from the literature as factors affecting mango marketing and distribution. Farmers in Ghana do rarely have access to quality storage facilities on their farms. Due to bulk spoilage and post-harvest losses, many of them are compelled to sell their goods shortly after harvest, regardless of the price offered. This allows for price fluctuations between very low and very high levels, notably during mango's peak and off-peak seasons. Price fluctuations, which are largely beyond farmers' control, make their income unstable and make a major difference in how much a family earns over the year. According to Pardhi et al. (2016), the price fluctuation of mango is influenced by the other seasonal fruits in the market. In Pardhi et al. (2016) study, about 62 percent of the dependent variable (Mango price) was explained by the selected independent variables (Price of Banana, Sweet Orange, and Apple). This implies that there is a positive effect of other seasonal fruits on the price of mango. This was reflected in the market during the outbreak of the COVID-19 pandemic where there was a demand for almost all seasonal fruits for immune boosting. Poorly developed transport infrastructure is one of the major constraints that affect the marketing and distribution of mango, especially producers and distributors that send their produce to the market centres. Many of the roads in Ghana from the production zones to market or pack houses are in a deplorable state. Thus, transporting fresh fruits like mango from the farm to the market or University of Ghana http://ugspace.ug.edu.gh 21 processing firms affect the quality of the mango hence the income earned by the actor (either producer, distributors, and or processors). 2.4.3 Processing Constraints Mango supply availability and quality, understanding of processors needs by mango suppliers, high cost of raw material, poor road network, cost of imported packaging material, cost of energy supply and consistent delivery, available market intelligence, knowledge of good processing techniques are some of the many challenges facing the mango processing sub-sector. There are a greater number of mango farmers as compared to processing factories in Ghana. In view of this, the plant capacity in Ghana is insufficient to absorb the bulk or volume of mangoes produced especially during the major season. Also, some of the processing firms cannot store fresh mango fruit to feed their processing machines, especially during mango off-seasons. This forces some of the processing firms to source their fresh mango fruit from neighbouring countries. This increases their cost of production. It is therefore necessary that available firms should organize their supplies and products to be able to absorb fresh mangoes produced domestically in meeting the demand of the processed mango consumers. The quality of transportation of fresh mangoes to processing plants is also hampered by poor road infrastructure in production locations (Gray, 2020). 2.5 The Concept of Value Chain According to Hailu (2016), an agricultural value chain is a series of actions that includes all enterprises and their activities involved in the distribution of inputs, production, transportation, processing, and supply of the output or products. In the 1980s, Michael Porter coined the phrase "value chain," defining it as "the several operations that were undertaken in particular links in the chain" (Van Melle et al., 2008). UNIDO (2009), explains value chain as a “mechanism that allow University of Ghana http://ugspace.ug.edu.gh 22 producers, processors, buyers, sellers and consumers-separated by time and space-to gradually add value to products and services as they pass from one link in the chain to the next”. From the varied definitions, Opoku-Mensah (2020), pinned that the value chain involves a series of activities, a set of actors and participants, a network of working systems and relationships, and an arrangement of linkages aimed at adding value to a product. Agricultural value chain analysis is a continuous approach that examines whether changes in organizational models, institutional arrangements, and management strategies affect domestic and international commodity demand and supply, as well as technical developments in production and marketing. A value chain is an approach for describing how inputs and services are combined and then used to create, convert, or manufacture a product; how the product is physically transported from the initial producer to the end user; and how value is added along the way as described by Webber & Labaste (2010). A number of actors are involved in the activities required to move a product from conception to final user, ranging from input suppliers through producers and processors to exporters and customers. It is therefore network-oriented and relationship-dependent. Thus, the chains of activities are influenced by four elements which include the end markets, support services, inter-firm relationships, and business-enabling environment. The end markets for the final product give market opportunities and set the criteria for the value chain expansion. Also, the support of financial and nonfinancial institutions enhances the performance of the value chain system (Mataia et al., 2020). The assessment of these chains of operations reveals which sectors are stifling progress – which bottlenecks require immediate attention – and gives a platform for sector-specific action or development (Gor et al., 2012). Also, it helps in policy identification and programming to advance the development and how local businesses can better explore into the global economy. The inter- University of Ghana http://ugspace.ug.edu.gh 23 connection and coordination among actors ensure the flow of product, knowledge, services, and information (Mataia et al., 2020). The value chain consists of actors who actively participate in the different nodes of the chain and who maintain dynamic relationships. It also involves the enabling environment, including policy- makers, service providers, and civil society, all of which impact the value chain in different ways. 2.5.1 The Global Value Chain Global Value Chain (GVC) refers to a sequence of processes that goods, commodities, and services go through from the point of conception all through production, marketing, and distribution to the final consumption at geographically distinct locations across the globe (Gereffi & Fernandez- Stark, 2011). Value chains become global when a product moves from one geographic location to another basically across the globe. Most often the GVC is characterised by a long-term relationship that is complex in nature with a high level of inter and intra firm flow of inputs, technology, and credit which is governed by contracts enforced by multinational corporations. These multinational corporations exert control over stringent standards, quality, certifications, prices, and compliance with requirements such as Hazard Analysis and Critical Control Points (HACCP) and ethical sourcing (Opoku-Mensah, 2020). Prices are extremely low domestically for value-added products (Riisgaard et al., 2011) however, the Global Value Chain serves as an avenue for smallholder farmers in the agri-food industry to gain access to better prices in international markets thus taking advantage of the potential benefits of high returns relative to the domestic value chain. A better understanding of this enhances productivity, efficiency, and the country’s development. One of the key factors that affect mango marketing at the global or international level is standards. Through the help of MoFA and GEPA, most farmers in the mango production areas visited were GLOBALGAP certified. For instance, GEPA documented 120 mango producers or farmers as University of Ghana http://ugspace.ug.edu.gh 24 members of the Farmer-Based Organisation (FBO) in the Yilo Krobo municipality. Out of these 120 farmers, about 63 farmers are GLOBALGAP certified representing 53% of the FBO members. This suggests that about 53% of the farmers in the Yilo Krobo district who are FBO members produce high-quality fruits which meet international standards and hence could be or are engaged by exporters. 2.5.2 Value Chain Analysis Value Chain Analysis (VCA) originated from various intellectual streams including Michael Porter’s approach to value chains, supply chain management, world-systems theory, and the global commodity chain approach, which was later known as the global value chain approach. Michael Porter’s chain was named the French filiére (Raikes et al., 2000). The French filiére (chain) approach was used around the 1960s, and this approach concentrates on optimizing the physical flow of products within a particular sector thus, aiming for large-scale value addition and export. Primarily, this approach was used to analyze French agriculture but was later used in the analysis of agriculture in developing countries, focusing on value addition and improvement of export commodities such as coffee, cocoa, cotton, mango, pineapples among others from the French colonies (Raikes et al., 2000; Lie, 2017). The approach expounds on how the agricultural sector is linked to downstream industries such as trade, processing, and export as well as consumers. The term “value chain” comes from the work of Porter’s (1985) value chain concept that relates basically to a firm-level strategy that focuses on examining the relationships between different actors that perform different activities within an organization. Porter’s concept provides an analytical framework that allows firms to identify their competitive advantage source based on cost structure and pricing strategies (Raikes et al., 2000; Lançon et al., 2017). The framework allows businesses to concentrate on the physical transformation of a product, with a focus on input University of Ghana http://ugspace.ug.edu.gh 25 procurement, product design, marketing and sales, strategic human resource management, and research. Through the successful management of actors and their functions, managers thus enhance the firm’s competitive advantage through value addition and positioning in relation to their suppliers, buyers, and competitors (Lie, 2017; Porter, 1985). Meanwhile, Kaplinsky & Morris (2001) developed VCA which looks at the value chain from the global perspective which many practitioners find useful for its provision of a broader and holistic view. Over the years there has been an increasing gap between the various actors' gains and the relationship that exists between these actors. Thus, Kaplinsky & Morris (2001) developed the VCA approach which provides an understanding of total value gained by a different actor, their activities, and relationship that exist even up to the global economy level (pic actor). And from the global economic level, international relations such as producers, importers, exporters, and retailers providing access to market and suppliers due to knowledge developed are considered in this value chain analysis approach. According to Biggs (2007), value chain analysis is the process of accounting for and displaying the value which linked the product or service being transformed from its natural material (raw) state to a customer-desired product. It includes market segment analysis, value chain mapping, performance measurement, and benchmarking, all of which enable the identification of performance gaps in a specific value chain. Value chain analysis provides firms with market development in local, regional, and international especially with smaller groups in view which allow for links to be traced. For instance, the activities of smallholder farmers as a target group can be linked to other value chain actors that exist on a local, regional and international level (Herr, 2007; M4P, 2008). Value chain analysis helps analysts and practitioners with a well-structured, yet flexible framework to identify the flow of products and interactions between different actors University of Ghana http://ugspace.ug.edu.gh 26 in a value chain. Lançon et al. (2017) explain that understanding about value chain enables researchers to reflect on the micro and macro levels of production and distribution. From an economic as well as an institutional standpoint, a value chain analysis aids in uncovering the strength, weaknesses, possibilities, and limitations that exist along the value chain. Also, value chain analysis is a useful tool that helps to identify the efficiency and competitiveness of enterprises and the activities enabling a competitive market environment. It provides practitioners with relevant information related to competitive advantage in terms of cost, value addition, product segment, and upgrading critical success factors for better markets (Luitel, 2017). Value chain analysis comprises four main components: (i) mapping the value chain, (ii) analyzing the governance structures of the chain, (iii) identification of opportunities for upgrading, and (iv) assessing the distribution of benefits in the value chain. 2.5.3 Approaches to Value Chain Analysis The Value Chain Approach (VCA) is unique in terms of the scope employed in researching industry and the tangible and non-physical aspects used in developing and executing interventions. Few of other economic development techniques simultaneously highlight all of the characteristics discussed here: a market system perception, a focus on end markets, an acceptance of the importance of value chain governance, awareness of the role of relationships, facilitating changes in firm behaviour, transforming relationships, targeting possibilities, and equipping the private sector. One of several market system methods to development is the value chain approach. This type of practice has gained popularity among several contributors in a range of circumstances in recent years. While these approaches differ in terms of terminology, frameworks, concepts, and even system definitions, they all agree with the notion that the poor and their economic chances are deeply affected by the dynamic systems in which they operate. Opportunities and outcomes University of Ghana http://ugspace.ug.edu.gh 27 can be enhanced for the poor by changing how those systems operate. The value chain approach sought to better understand the businesses that operate within an industry, from input suppliers to end-market consumers; the industry's supporting markets that supply technical, business, and financial services; and the industry's operational environment (Kaplinsky & Morris, 2001). Taylor (2005) mentioned some key approaches or areas of focus in assessing the value chain. Some of the significant approaches Taylor (2005) enlisted include, building a clear approach in understanding the VCA, developing supply chain structures and choosing target value stream, developing a roadmap for the structures or facilities within the chain, and identifying and assessing the whole chain issues and opportunities. Primarily, building a clear approach to the value chain requires an understanding of the specific value chain. This necessitates a review of available literature that provides relevant information in understanding the value chain and also highlighting what opportunities and benefits can be derived from along the chain. Understanding a particular value chain helps in identifying the various areas, for instance, the specific marketing outlets to sell farm produce or product to increase utility and improve livelihood. Moreover, one fundamental role of VCA is enhancing the performance of the chain (Taylor, 2005). Having a clearly defined picture of the various structures within the value chain helps in identifying what to variety produce to gain competitive advantage and thus, meet consumer preference. Also, developing supply chain structures along the value chain allows identification of the various actors and structures to give attention to in adding value to the raw material (mango fruit) before it reaches the end-users and selecting the target group that enhances the productivity of the business (eg. The farm business). In addition, developing a roadmap for the structures or facilities within the chain requires feasibility assessment that allows identification of the facilities available along the chain that can be used in adding value to the mango fruit and drawing a plan on how the products can be moved University of Ghana http://ugspace.ug.edu.gh 28 to the available facilities for value to be added on before sending to the target market (Hines and Rich, 1997). Taylor (2005) mentioned that assessing the processes that occur at the various facilities helps to identify and quantify the value-added product (eg. mango juice) from the non- added value (fresh mango fruit). Furthermore, identification and assessment of the issues and opportunities that exist along the whole value chain create an avenue for issues that relate to production (eg. post-harvest handling and losses, mismanagement of pest and diseases) and marketing (eg. poor quality of the fruit and fluctuating prices) to be addressed. Jones & Womack (2002) pointed out that assessment of the chain makes it possible for classification of issues especially for those that relate with physical flow of the product (mango fruit and its processed product) and information flow. 2.5.4 Value-Added Product Any product that receives additional activities or is integrated with additional products to increase the total value of the product is referred to as a value-added product. Lançon et al. (2017) assert that this action boosts the product's economic worth. For example, value addition occurs when a business takes a product that may be regarded homogeneous, with few if any distinctions from that of a rival, and adds a feature or add-on that gives it a higher perceived value. A product's value can be increased or increased by changing its existing location, time, and form features to those that are more popular in the marketplace (Raikes et al. 2000). Value can be added to mango through processing, cold storage, and packaging to give its customers their preferred taste or likes. 2.5.5 Mapping the Value Chain The Figure 3 below presents the various actors, linkages, and the role they play in the mango value chain. The mapping involves support institutions such as MoFA, Agricultural extension service providers, development partners and NGOs, financial institutions and local money lenders, University of Ghana http://ugspace.ug.edu.gh 29 production, marketing and distribution, processor actors, and consumers. The diagram illustrates the direction of their support ( ), the flow of product or commodity ( ), and the role they play. From Figure 3, it can be observed that the primary point of the value chain starts with the input dealers all through producers, distributors, and processors and ends with the final consumer. (Source: Adapted from Salifu et al., 2017) Input Suppliers Primary production Processing Distribution Consumption Distribution n Development partners, NGOs -Funds, advise, capacity building Government (MoFA) -Policy formulation Local money lenders -Loan Financial Inst. -Give credit Agricultural extension Tech. support, advice & monitor Mango farmers -Prepare land -Plat seedlings -Harvesting -Post harvest Wholesalers /Retailers -Transport, sell Retailing centres Supermarkets Local market Small-scale & Commercial Processors -Produce mango juice -Cut mango -Dry mango flakes -Seedlings -fertilizer -Other agrochemic als -Individuals -Institutions Figure 3: Mango Value Chain Actors, Functions and Existing Linkages University of Ghana http://ugspace.ug.edu.gh 30 The activities and management of these actors are supported by institutional actors that operate along the value chain in ensuring the efficient and effective operation of the value chain system. For example, input dealers make available inputs such as seedlings, farm tools, crates and boxes, pasteurizers, and processing machines among others that are necessary to the various actors along the chain. The producers acquire the seedlings from the input dealers and then transport them to prepared land. 2.5.6 Value Chain Upgrading Upgrading is the process of acquiring market-linked technology capabilities that allow businesses to increase their competitiveness and move into higher-value activities (Kaplinsky & Morris, 2000). Upgrading in firms can occur in several forms like process upgrading, functional upgrading, product upgrading, and chain upgrading. Humphrey & Schmitz (2000) and Humphrey & Memedovic (2006) established that upgrading does not isolate the investment in people, their know-how, and processes from improvements in products. Several studies such as Humphrey & Schmitz (2000) and Humphrey (2003) provide an empirical review on the significance of upgrading the agricultural value chain. According to the literature, process upgrading comprises raising the efficiency of internal processes to the point where they are significantly superior to those of competitors, both within and between individual relationships in the chain. The product upgrading looks at modern products or adding value to old products to be much better than rivals. This entails making some adjustments to design and development procedures both inside individual value connections and in the relationships between them. This enhances the quality of the product than that of rivals. Furthermore, the value created by changing the mix of activities that take place within the firm is University of Ghana http://ugspace.ug.edu.gh 31 measured by functional upgrading (for example, taking responsibility for outsourcing accounting, logistics, and quality functions). Finally, updating a value chain entail switching to a new one. 2.5.7 Value Chain Governance The interactions among customers, sellers, service providers, and regulatory organizations which affects the a sequence of activities needed to transport a product or service from the point of production to end users are referred to as value chain governance. Power and the ability to impose influence along the chain are fundamental to governance (Fredrick & Gereffi, 2009). At every point along the chain, certain firms or institutions determine and enforce the parameters which actors must comply with in ensuring efficient delivery of the product. What is to be produced, which includes product design and specifications, how it can be created, which includes manufacturing methods, and finally how much is to be produced and when to produce are the essential elements that inform governance. This refers to the logistics and scheduling of production. Chain governance occurs when some firms operate to meet the standards set by other competing firms in the chain. There are many types of value chain governance; • Market: Market governance involves the making of products from minimal inputs from buyers, simple transactions, and transmission of product information on product specifications (Mugabira, 2017). • Modular value chain: Modular governance is another type that occurs when the nature of products requires firms in a chain to take up complex transactions that are easy to be structured up. • Relational governance is a governance pattern where mutual reliance between firms usually through social, reputations, or family affiliation influences the transfer of information and embedded services between buyers and sellers (Williamson, 1983; Mugabira, 2017). University of Ghana http://ugspace.ug.edu.gh 32 • Captive governance is a chain where small suppliers depend on a few buyers that wield a great deal of power and control. There is a high degree of monitoring and control by the lead firm. • Hierarchical governance refers to a set of lead enterprises that create and manufacture products in-house and are characterized by vertical integration and management oversight. When product specs cannot be sorted, products are complex, or there are no highly skilled vendors, these systems emerge (Mugabira, 2017). Governance can be exercised in different ways, and different types can be exercised even in the same chain (Humphrey & Schmitz, 2000). Thus, the study employed the grading (scoring) exercise used by Kaplinsky & Morris (2000) with variables identified from literature which could make an actor exercise “importance” and “influence”. The variables of interest include profit, bargaining power, and information concentration. According to Clottey (2014), “importance” is analyzed as an actor’s capacity to exercise some level of force and influence within the chain, while “influence” refers to the power that an actor possesses in exerting control and effect on other actors present in the chain. The mean score of all the actors in question such as producers, distributors, and processors were calculated of which each total score amount to 100%. The score reflects the strength of the variable for each actor. This implies that the higher the score (%), the better the level of importance and influence the actor carries within the chain. Hence, the actor with the highest score is considered the dominant actor along the mango value chain. 2.6 Supply Chain Concept The supply chain is a linked set of activities that deals with the planning, coordination, and management of material parts and finished commodities from suppliers to customers. It is University of Ghana http://ugspace.ug.edu.gh 33 concerned with two distinct flows of material and information through the organization (Steven, 1986). The scope of the supply chain begins with the source of supply and ends at the point of consumption. “A supply chain is a network of facilities and distribution options that performs the functions of procurement of materials, a transformation of these materials into intermediate and finished products, and the distribution of these finished products to customers” (Huang et al., 2002). The supply chain involves decision-making to ensure that customers receive the right product. Decision making regarding the supply chain both individually or collectively must encompass five major areas: • Production -This examines the type of product that the market wants, as well as how much of each product should be produced and when. This task includes developing master production plan that takes in consideration the plant capabilities, quality control, and equipment maintenance (Huang et al., 2005). • Inventory - What inventory should be put in stock at each stage in a supply chain to meet future demand? How much raw materials, semifinished items, and finished goods should be kept on hand? This is because inventory's primary function is to act as a buffer against supply chain uncertainty (Huang et al., 2005). • Location - The location of facilities for production and inventory storage is crucial in supply chain decision-making. What are the most cost-effective locations for manufacturing and inventory storage? Should current facilities be utilized or should new ones be constructed? Once these judgments are established, the possible channels for product flow are determined, allowing for easy delivery to the final customer. • Transportation - What are the various means to transport goods from one supply chain site to another? Moving inbound supplies from supplier locations to manufacturing facilities, shifting University of Ghana http://ugspace.ug.edu.gh 34 inventory across different factories and distribution centers, and delivering final products to clients are all part of seamless supply chain activities. When making supply chain decisions, it is preferable to consider the fastest and most dependable mode of transportation for delivering the goods to the final client (Gray, 2020). For example, the use of Airfreight and truck delivery of mangoes are generally fast and reliable but they are expensive. While shipping by water is less expensive, it usually requires longer transit times and more risk. Higher volumes of inventory must be stocked to compensate for the unpredictability (Steven, 1986; Huang et al., 2005). • Information - Better coordination and decision-making can be achieved with timely and reliable information. Thus, it is necessary to ask how much data to collect and how much information should be shared? With accurate information, effective decisions can be taken to inform what to produce and the volume to produce, destinations to locate inventory, and how best to deliver the product. The summation of these decisions describes the proficiencies and elaborates how effective a firms supply chain is and how it can thrive in the market in meeting customers’ demands (Hugos, 2018). 2.7 Performance Analysis 2.7.1 Social Network Analysis (SNA) and Market Information Access Several studies traced back the network analysis to Euler’s development of Graph Theory (mathematics) in 1736, of which the antecedents of SNA in particular spread to Comte’s notion of ‘‘social physics’’ in the early 1800s. Until the early 1930s, there was a divergent perspective of the historical development of SNA between the U.S and the Europeans (Dempwolf & Lyles, 2012). Borgatti et al. (2009) mentioned in their study on network analysis in Social Sciences that in the 1930s, Moreno and his colleague Jennings conducted a study on teenage run-aways from the University of Ghana http://ugspace.ug.edu.gh 35 Hudson School in upstate New York. In their study, they measured and mapped the various friendship ties between the girls which Moreno called “Sociogram”. The study revealed that the friendship ties show the location of the girls and the structure of influence as to whether they ran away, or if so, when. This study together with Sociometry merged the historical development of SNA around the 1930s. Moreover, mapping of actors, relationships, and interactions as networks and the application of graph theory and matrix algebra to visualize and analyze network data and structures increased in the 1940s, 50s, and 60s (Dempwolf & Lyles, 2012; Moreno, 1934). For example, in 1957 Bott’s examined the influence of spousal roles among British families using social networks. His finding revealed that forms of network ties that exist among spouses influenced whether they share responsibilities or are still held to a customary division of responsibilities between husband and wife (Bott, 1957). During that time, there was a high surge in the application of SNA techniques to studies by the Sociology community which had advanced the understanding of urbanism and community structure. For instance, Hollingshead (1949), documented the influence of cliques on adolescent behaviour, and Fischer (1948) pinned that urbanization reduces network density in California (Borgatti et al. 2008; Dempwolf & Lyles, 2012). By the 1970s, SNA was adopted by a group of researchers from the Sociology society led by Lorraine and White. The group focused on issues related to roles, network position, and structural equivalence which allowed several students to be trained. Many of these students emerged as great scholars whose studies reveal the various functions, benefits, and weaknesses of the SNA technique. A study conducted by Granovetter (1973) on The Strength Of Weak Ties provides an understanding of network interactions which has been cited in several studies from different disciplines. University of Ghana http://ugspace.ug.edu.gh 36 According to Ameru et al. (2018) market information process entails gathering agricultural data based on market prices (spot or futures), quantities supplied to the market versus quantities sold, and other market-related data on a wide range of agricultural products. The data comes from a variety of marketing channels as well as a number of trustworthy information sources. After the data has been gathered, it is analyzed and packaged in a user-friendly style before being distributed to farmers, merchants, government officials, and other interested parties through various communication channels. Agricultural marketing information refers to all facts and information related to agricultural activities which are relevant in making marketing decisions and which could invariably influence the marketing operation of an agricultural business. Marketing information can be categorized as either up-to-date, current information, or information compiled over time (historical information) (Megasa et al., 2014). Svensson & Yanagizawa (2009) narrated that while current information aids farmers with efficient bargaining strength, historical information guides them in planning their production, storage decision, and early harvesting to meet market demands. Access to market information has many benefits for actors along with the value chain system. When value chain actors, for instance, mango processors have access to current market information it will assist them in identifying better-marketing outlets and could influence their participation. Also, market information accessibility helps farmers to schedule the harvest at a more profitable time to be able to maximize utility. FAO (1997) writes that access to market information about prices over a season or more could offer farmers valuable information to diversify into new crops or grow different variety that meets market preference. Access to market information could help reduce the transaction cost of mango value chain actors and also prevents urban consumers from facing alternating gluts and shortages of mango fruit and its related products. Market information accessibility provides transparency which creates awareness to all University of Ghana http://ugspace.ug.edu.gh 37 parties about prevailing market prices and other market-relevant information (Shepherd, 1997; Magesa et al., 2014). Improvement in the transparency of the marketing system reduces the riskiness associated with participating in some markets. Based on this, market participants decide the particular marketing outlet to participate in to be able to take advantage of expected higher prices. Finally, accessibility of market information keeps value chain actors abreast with the competitive condition and market environment which helps reduce the communication gap between producers, distributors, processors, and their respective consumers (Ferris et al., 2008). 2.7.2a Impact Assessment Beyuo & Anyidoho (2021) compared the differences that exist in the nature and impact of the various methods employed by two NGOs carrying out food security programmes in some areas within the Upper West Region of Ghana. About 250 beneficiaries and 100 non-beneficiaries were engaged for their study of which they employed the difference in difference model to evaluate the impact of participation on food security. The results found by their study reveal that more participation in the food security programme significantly impacts beneficiaries’ food security and hence, penned that meaningful participatory approaches are necessary for an intervention to enhance the food security of rural people. Kibira et al. (2015) assessed the economic benefits of adopting an integrated pest management (IPM) package that included male annihilation technique (MAT) and augmentorium application to control mango-infesting fruit flies in Kenya. The impact of mango IPM on the amount of mango rejection, pesticide cost, and net revenue was investigated using the difference-in-difference (DiD) approach. The study highlighted that there was about a 54.5% reduction in the magnitude of mango rejection as a result of participation in the IPM programme by the mango farmers which also reduced the insecticide expenditure by 46.3% per acre. Their study mentioned that these results University of Ghana http://ugspace.ug.edu.gh 38 increased the net income received by the farmer by 22.4% as compared to non-participants. Kibira et al. (2015) added to the literature that application of the fruit fly IPM technology by mango farmers would positively and significantly influence the income generated by the farmers and thus, the intervention should be expanded in mango-growing areas in Kenya. 2.7.2b COVID-19 and its Impact on the Mango Value Chain The COVID-19 pandemic hit has become a thing that is staying with countries all over the world. The increased infectious nature of it has kept countries and their health workers on their toes as a little negligence could cause huge damage to nationals. The virus’ widespread has affected numerous sectors of the Ghanaian economy, including agriculture, services, and industry. Along the agricultural value chain, farmers, retailers, and processors have all suffered losses. Most farmers, retailers, wholesalers, and other actors in the value chain system were affected by social distancing, partial lockdown, and movement restrictions that culminated in the closure of some market centers around the country. Some of the pandemic's effects may not be completely seen right now, but the agriculture sector will be negatively impacted shortly because food security is critical. According to FAO (2020), the outbreak of the COVID-19 pandemic caused a serious economic downturn. The downturns slowed a lot of systems which resulted in job losses and other disruptions such as food and fruit export and importation, sales, and procurement of resourceful inputs for agriculture production, marketing, and trading systems. For instance, there was a shortage of labour to support agricultural production which put the quality of fruits and diets at risk. Due to these shocks, food unavailability, hunger, malnutrition, food insecurity, and insufficient funds were some results of the COVID-19. FAO projected an increment of 14.3 percent or 6.7 million people to suffer undernourishment or acute malnutrition due to the pandemic (FAO, 2020; WFP, 2019). University of Ghana http://ugspace.ug.edu.gh 39 Field monitoring and interaction with farmers and Agri-SMEs show that if strategic investments and focused support are not made in the agriculture sector, there would be a shortfall in food production, putting the country's food security in jeopardy. In Ghana, there are lots of smallholder farmers that grow various crops such as fruits, vegetables, etc. that are exported to Europe, China, America, and some other places. COVID-19 made exports come to a halt bringing the volume down as land, sea, and air borders were closed or restricted around the world. “The corona virus has stopped all of our shipments,” Alex Kravecas, owner of MakolaHub Fresh, told freshplaza.com in an interview in 2020. Commodity prices were also sky- rocketed. For instance, the price of maize in December 2020, surged so high that many could not afford while other products and businesses that depended on corn had their prices increased significantly (Kilic & Marin, 2020) Most mango farmers in Ghana produce to feed both the local markets and the international market. The majority of the mango producers (farmers) move to local markets to sell their produce while some buyers being it wholesalers, retailers, or middlemen move to buy directly from farmers. Market closures and other limitations had a significant impact on these farmers and businesses. COVID-19 had an equal impact on fruit processors, as some were unable to obtain the raw materials required for production, while others couldn't get enough. Fruit prices have risen significantly as a result of the supply shortfall. Also, some processors laid off their workers to cut down their production costs, while some small-scale processors ended up shutting down entirely. While some lamented on the negative effects of the COVID-19, some dried mango fruit businesses rejoiced as they made significant profits during these times as a result of increased consumption to build the immune system with more essential vitamin A and C. Around 90% of naturally dried University of Ghana http://ugspace.ug.edu.gh 40 mangoes exported to Europe are taken from Africa. West Africa alone contributes about 60-65% of the supply while South Africa contributes 30% and the rest of the supplying countries, a mere 10-15%. COVID-19 is not expected to have any serious negative impact on the consumption of this dried fruit. On the contrary: during the crisis, many companies in Ghana stockpiled their dried mangoes as dried mangoes are also shelf-stable food. The only factor that prevented a stronger increase in consumption is the increase in retail price. On average, export, wholesale and retail prices are significantly higher compared to those of most other dried fruits on offer. 2.7.3 Multinomial and Logistic Regression A logistic regression model is an analytical tool that explains the relationship that exists between one dependent variable and one or more independent variables. While the dependent variable is binary, the independent variables can be nominal, ratio-level, interval, or ordinal. In general, the multinomial and logistic regression models have been used by several analysts and documented. Adu (2018) applied a binary logistic model to reveal the factors affecting rice farmers’ choices of marketing outlets. The choice alternatives in her study were direct market outlet (processors) and indirect market outlet (middlemen). Ouko (2016) applied the multinomial logit model to determine how socioeconomic characteristics influence the choice of Seed Sources of Smallholder Bean Farmers in Bondo Sub-County in Kenya whereby his choice alternatives were his own saved seed source, neighbouring farmers Local and grains market seed source. Fertő & Szabó (2002) made use of the multinomial logistic model in analysing the various factors determining the selection of supply outlets in the Hungarian fruit and vegetable sector. The various choice alternatives identified in his study were found to wholesalers, marketing cooperative chains, and production lines. Meanwhile, Tadesse (2011) adopted the multiple linear regression as an analytical tool to examine the factors influencing the supply of avocado and mango in Gomma University of Ghana http://ugspace.ug.edu.gh 41 Woreda, Jimma Zone, Oromia National Regional State in Ethiopia. The choice alternatives identified in his study were wholesalers, retailers, assemblers, and processors. Additionally, Jari & Fraser (2009) employed the multinomial logistic regression model in analysing institutional and technical factors that influence agricultural marketing channel selection amongst the smallholder and emerging farmers in the Kat River Valley in South Africa. In the model, the smallholder farmers were interviewed on their choice of the three possibilities of market participation, viz. formal markets, informal markets, and not participating in markets, which was set as the dependent variable. 2.8 Empirical Review 2.8.1 Value Chain Assessment Several studies have looked at the value chain in Ghana. Notable among them is value chain analysis studies performed by Salifu et al. (2017) who analysed the Groundnut Value Chain in Ghana. In their study, the key actors identified within the groundnut value chain in Ghana were producers, distributors, and processors whose roles and activities are critical in addi