CHAPTER 4 - ECONOMIC ASPECTS OF POST-HARVEST LOSSES

When speaking of food losses, a first consideration is the distinction between perishable and non-perishable or preservable foodstuffs (see Chapter 2, Table 1, the table comparing foodstuffs according to their suitability for storage: FAO, 1984). In one of its studies assessing losses of perishable products through handling or post-harvest operations, the special FAO loss-prevention programme presents the following conclusions: if harvest operations, storing (stacking and/or packaging in warehouse), storage and transport are defective, losses are separated as follows:

Although average losses are not in fact so high when an overall calculation is made, they are still far from negligible. While the situation is certainly better for non-perishable products, it is still unsatisfactory and could be improved. This can be seen, for example, from an Asian study on the post-harvest chain for grains (cereals), which analyses losses from the main operations and estimates percentages for those that could be avoided. Its conclusions are as follows: each year five percent of the losses from poor monitoring and regulation of humidity and another five percent of the losses from problems connected with handling, storage and processing, could be avoided (study by P. Douglas, G. Dubrick and G. Sullivan, ASEAN).

In this connection, we would note that in industrialized countries, grain producers accept a one percent wastage during combine-harvesting and a two percent wastage during storage as normal, making three percent for these two operations alone. The current rule is stricter, estimating that an acceptable loss rate would be 0.75 to one percent after nine to ten months' storage. The loss rate accepted in the commercial sector is usually 0.75 percent.

An Argentinian study has calculated the financial effect of post-harvest losses on commercial management costs.

Table 21. Effect of losses on commercial management costs
(Source: C.E. Fru, Cor, Argentina, 1993)

Like loss assessment, calculation or assessment of costs and cost prices entails considerable difficulties, if not uncertainties, if all the relevant factors are to be taken into account. It is particularly important to be clear as to whether the "rational" economy of an industrialized country or that of a developing country is involved. Even then, such figures are always of relative value and are dependent on a socio-economic framework that must never be forgotten. These difficulties are certainly one of the main reasons why economic data are poorly developed in works on post-harvest systems and losses.

The costs (in monetary terms or as a percentage) given in the following tables come from widely varying sources and concern three essential operations in the post-harvest pipeline for cereals: threshing, drying and storage. First is a study of a rice project in Mali (the Harpon Project) which compares the costs of traditional hand threshing and mechanized threshing with a ventilator, noting the corresponding losses:

The new threshing techniques thus reduce both costs and losses markedly, apart from the saving in time and toil.

The NRI manual financed by FAO (Rome, 1994, unpublished) contains a detailed table on paddy drying, giving the technical specifications of the drier and the different unit costs of three methods of reducing the moisture content of freshly cut paddy from 20 to 14 percent. Some relevant data are extracted from the table and the case of drying a small amount is also given for each variant:

We would merely highlight the differences in unit cost per tonne, which shows that drying a small amount turns out to be the most economical system and that continuous-flow drying is cheaper than recirculating a batch. Table 22 confirms this conclusion, since for a large amount the most economical system is continuous-flow, followed by the first system (batch-in-bin) and lastly the recirculation system.

Table 22. Dryer specifications, estimated performance and cost of drying freshly
harvested field paddy (raw paddy) (Source: Wimberly, 1983)

Studies on the economics and management of the cereal post-harvest system in France indicate that storage amount comes to 12 percent of the value of the grain. The cost calculations in the summary report on the Accra Workshop cited above have the advantage of comparing the cost/benefit ratio for three different granaries after six months' storage. As before, these figures refer to trials on maize storage in Benin, i.e. a small-scale, village environment and compare the performance of a number of improved granaries with that of a control granary of the traditional type. The maize was stored in cobs still in their husks and the two improved granaries, BT 2 and BT 3, had capacities of two and six tonnes, respectively. The document specifies that "the cost of storage comprises costs of construction, phytosanitary treatment and handling into storage" and that "the cost/benefit ratio is the greatest value achieved by delaying the sales of maize".

Table 23. Costs of storing maize cobs in husk in improved and traditional granaries
(Source: FAO, Accra Workshop, 1994)

It can be seen that technical improvements in granaries make storage a profitable operation (see tables 24, 25 and 26 for the results of these comparative trials).

Table 24. Development of grain moisture content
(Source: Accra Workshop, FAO, pp. 53-54)

Table 25. Damage caused by mould (% of mouldy grains)
(Source: Accra Workshop, FAO, pp. 53-54)

Table 26. Percentage of weight loss caused by insects
(Source: Accra Workshop, FAO, pp. 53-54)