MADAGASCAR

Introduction

Madagascar’s organic sector started small and remains small. A lack of knowledge in production, certification, processing and export continues to inhibit growth. This is in spite of assistance from several outside agencies, including major donors. Fresh organic fruit and vegetable exports have proved unsuccessful, and the only current exports are in the processed category. Efforts to organize a viable organic sector continue among private enterprise and aid group, but it is likely to be some time before an effective organic export sector can develop.

1. History of the organic sector in Madagascar

1.1 Origins and pioneers

At the end of the 1980s a French and a German company each initiated an export-oriented organic production of spices and other products in Madagascar. These companies developed consultancy services and ordered inspection in line with EC Regulations. As the importers were in possession of the organic certificates some exporters of organic products from Madagascar became dependant on those two companies. The producers/exporters were therefore not able to sell their products as organic to other potential purchasers, resulting in incomprehension and discontent.

In 1993 three entrepreneurs (Mister Blue Organic, l’Eleveur and Phael Flor) founded the association PROBIOMAD (today called "PROMABIO"), Syndicat Professionnel des Opérateurs en Produits de l’Agriculture Biologique. Shortly after, the companies Fiona and Agrico became members too. The main objectives of the association were to: (i) promote organic agriculture; (ii) support producers, processors and exporters of organic products; and (iii) develop the brand name "PROBIOMAD".

The first organic certified products in Madagascar were: spices, essential oils, cashew nuts, coconut oil and palm oil. At the beginning, most of the certified organic products were collected from the wild. Proper organic agricultural cultivation started at a later stage. Most products were and still are produced by small-scale farmers, while processing, grading and exporting has been done by commercial companies.

1.2 Support to organic agriculture

In Madagascar, no Government support exists for organic agriculture. However, during the 1990s, some international organizations and foreign agencies have provided technical support to enhance the organic production capacity and promote export. This section describes the main providers of assistance and lists some of their activities in the country.

Between 1994 and 1996 private companies received support from the German Agency GTZ/Protrade (Gesellschaft für Technische Zusammenarbeit) through a product and marketing advisory service programme. Objectives of the programme were to: (i) strengthen the position of organic growers and potential companies producing organic products (through information and training) and to negotiate better terms with importers/trade partners; (ii) develop economic organic production of marketable products; and (iii) enable a successful entrance into the European organic market. Furthermore, Protrade supported participation at the yearly international organic trade fair in Germany, BioFach.

During 1994 to 1997, COLEACP (see: www.coleacp.org) had a small support programme for the organic sector in Madagascar. COLEACP did not support individual companies, but it supported associations and groups of producers and exporters. The support measures included, among others: (i) training; (ii) expert reports; (iii) inspections; (iv) participation at trade fairs; and (v) financing of short-term expertise.

The U.S. Agency for International Development (USAID) has supported the organic sector in Madagascar through: (i) co-financing of seminars on organic agriculture; (ii) financing and organization of training courses at the university; (iii) financing of an exporters’ mission to South Africa; and (iv) advising on organic plant protection. USAID and Protrade collaborated closely.

CDE, former CDI (Centre for the Development of Enterprise) became interested in organic agriculture in 1996. Following a seminar on the quality of plant products organized in Mauritius by COLEACP, GTZ and CDE, the latter organized a meeting between Malagasy producers and European importers of fruits and spices. In addition to the cases of individual support that followed the meeting, CDE began to support the PROMABIO association, which represents nearly all Malagasy producers. From 1997 to 2000 CDE co-financed the participation of Malagasy producers in BioFach, the leading trade fair in organic products.

1.3 Main factors that drove output growth and conversion to organic farming

A major factor influencing the decision to proceed with large-scale organic farming were the extensive farming systems practised. The agricultural production system in most parts of Madagascar promised quick certification for most of the demanded products. Initially (late 1980s/early 1990s), large, remote areas were certified, as no agro-chemicals entered these regions. It was organic by default and not due to practised organic methods.

In more recent years, requirements for certification of organic production methods have become higher. Commercial companies in Madagascar noticed the market potential for organic products and the possibility of fetching premium prices. Environmental concerns hardly played a role.

1.4 Initial constraints

With the relatively young and small organic sector, many constraints were faced, limiting growth of the production and export sector. The most important constraints, among many others, include:

• Lack of information and knowledge on principles and methods of organic agriculture;
• Lack of knowledge on the EC Regulation and requirements for export of organic products into the EC;
• Lack of information on procedures of certification and required documentation;
• The first systems of organizing production, collection, transport and processing of agricultural production did not allow a clear, transparent product flow. This made control difficult and called certification into question;
• Lack of market information, such as products demanded, required qualities, prices, potential importers and market size;
• Lack of national standards and regulations on organic agriculture.

2. Institutions active in the organic sector at the national and local levels

2.1 Farmer/producer organizations

PROBIOMAD was founded in 1993. In 1994, it had 12 members, and in early 2001, it had 15 members. In 1996, the syndicate changed its name into Le Syndicat Professionnel PROMABIO. The objective of PROMABIO is to represent the interests of its members, who are active in production, processing and marketing of organic products. PROMABIO is a member of IFOAM and the only association of entrepreneurs commercially active in the organic sector in Madagascar.

In late 1997, a second organic producers association (Association BIO CÔTE EST), was founded, but it was dismantled the following year. The main reasons for failure was that the member companies underestimated the necessity of a proper set-up of required logistics, as well as the required time to convert production from conventional to organic production. When the organic business could not be established in the first year, the members lost interest.

2.2 Foreign and international agencies

Five international agencies are currently supporting organic agriculture, through projects and technical assistance. Among the activities is a CARE project with the title PAPAT (Projet d’Amélioration de Plantes Tubercules) that focuses mainly on the improvement of manioc, sweet potato and potato. The project promotes the use of organic fertilizers, such as compost, manure, etc., in order to improve soil fertility. Another example is a USAID project with the title LDI (The Madagascar Landscape Development Interventions Activity), which includes technical assistance to turn a large coffee plantation in the Southeast Region into the biggest organic farm in Madagascar.

3. Standards and regulations

3.1 Standards of organic agriculture

No national standards concerning organic agriculture exist in Madagascar. Organic agriculture is mainly practised for the export markets, for which international standards, like the EC Regulation, are relevant.

3.2 Certification and control of organic production

Two international certifiers are currently operating in Madagascar: ECOCERT International and Lacon GmbH. Ecocert International has been active in Madagascar since 1990, and has certified 28 companies. Lacon GmbH started in 1998 and has certified one company. Both certifiers are EC accredited. All products certified by those companies are therefore accepted in the EC market.

Two of the certified companies are producing organic fruits and fruit products, but only one of them is exporting. The other company is facing quality problems in its organic apples and could not meet the required export standards for the past three years.

4. Production of organic fruit and vegetables

4.1 Production and export of fresh fruit and vegetables

During the past decade, a number of companies have made several attempts to produce and export organic fresh fruits and vegetables from Madagascar. However, until now, virtually all failed to succeed. Currently (early 2001) there is no export of organic fresh fruit and vegetables from Madagascar, while only one company is producing and exporting juice and pulp of a number of different fruits. This section describes some examples of companies which produced and exported fresh fruits but failed and tries to identify the main reasons for failure in order to formulate the "lessons learned" (see also Box 1).

In 1997, the Association BIO CÔTE EST has tried to export fresh organic litchis from Madagascar. With help of GTZ/Protrade contacts with potential importers in the EC were established. However, no successful trade took place, and the association broke up afterwards. Reasons for failure to establish an export sector include, among others:

• Malagasy exporters were not willing to start exporting small quantities (e.g. 50 x 2.5 kg boxes) as a first test export to interested importers, but insisted on 500 kg as minimum quantity;
• Bad communication between foreign importers and Malagasy exporters;
• Competition from South Africa, from which litchis were offered at lower prices;
• One Dutch company imported one pallet as a trial. After that, the price was considerably increased by the exporter, and the Dutch company returned to its former supplier in South Africa;
• Lack of information for the potential importers, for example, on timing of production (which is locked into the main harvest), estimated quantities of supply and prices.

Another example includes a company which started to export organic green beans "extra fine" from Madagascar to Europe in late 1998. A Dutch importer requested this product for the months between January to March. The Malagasy exporter had gained experience in production of these beans in a trail cultivation during the dry season and felt capable to deliver in other months as well. However, from January to March, Madagascar usually has rains, and the production of beans is difficult due to diseases, especially during the harvest. The first shipment of beans arrived at the destination market in poor quality; the Dutch importer rejected the shipment and cancelled further business relations. During other months of the year the importer receives supplies from countries closer to Europe with cheaper freight costs. Concluding, the main problems faced in this case include: (i) the domestic season of supply and foreign demand did not coincide; and (ii) the price of production was high and not competitive with other suppliers during other seasons.

4.2 Production of processed fruits

PROBIOMAD S.A. is the only company active in the production of certified organic fruits and vegetables in Madagascar. PROBIOMAD organize and finance inspection and certification among their members, which are mostly small-scale farmers. The fresh produce is processed to juice and pulp and are exported. PROBIOMAD is one of the main exporters from Madagascar. Products are shown in Table 1:

Table 1: Organic products exported from Madagascar
Products	Varieties	Hectarage* (Ha)	Quantities* (Tonnes)	Seasons
Pineapple	Cayenne lisse	15	150	December - February; July - September
Papaya	Local	8	56	July - October
Mango	Local	2,5	40	October - December
Guava	Local	100	100	March and April
Passion fruit	Violette	3	50	October - December; January - March

*The figures give the total hectarage that is certified and the potential quantity of output.

Papayas, mangoes, guavas and passion fruit are processed into pulp and canned. Pineapples are processed into pulp and juice. All products (besides passion fruit) are grown by out-growers. In the case of passion fruit, the company possesses a small farm in Tamatave but is also buying from farmers. The average farm size is 0.5 ha. Farms are managed by family members. A major production constraint is the limited financial power of the farmers. The out-growers are organized in producer groups. This simplifies certification and the collection of fresh produce.

5. Marketing

All certified organic products are meant for the export market, as there is no domestic market for organic products in Madagascar. The major destination markets are in Europe, especially Germany and France. Annex II shows the export quantities per product (group) for the past two years.

5.1 Exports of organic fruit and vegetables

No fresh organic fruit and vegetables are exported from Madagascar. In 1999, exports of organic processed fruits amounted to 47 tonnes. In 2000, 62 tonnes were exported by one company to the EC. Table 2 gives a detailed list of exported products.

Table 2: List of exported products
Product	Quantity in kg (2000)
Syrup of litchis	90
Pineapple in pieces	2 720
Pineapple juice	16 230
Crushed pineapples	350
Pineapple pulp	9 025
Litchis pulp	2 900
Mango pulp	20 580
Passion fruit pulp	2 275
Guava pulp	1 040
Green papaya pulp	7 180
Total	62 390

The exporting and processing company directly buys all products from the growers. All products are exported to France where the company has a marketing office that is also operating as the importer. The export prices (FOB) are on average 20 percent above conventional prices.

6. Conclusions

The organic sector in Madagascar is small, and exports are limited. Organic agricultural production has predominately been done by small-scale farmers. Certification is paid by the commercial companies. Le Syndicat Professionnel PROMABIO is the only association of entrepreneurs commercially active in the organic sector. There are no farmers’ organizations and no Government agencies active in this sector. Five international agencies are currently supporting organic agriculture. No standards or regulations and laws of organic agriculture exist. Certification is solely done for exporting. The only certifiers operating are ECOCERT International, which is doing more than 90 percent, and LACON.

Despite efforts to establish an organic export sector in Madagascar over the last decade or so, not many success stories are found so far. Major constraints include: (i) lack of knowledge and information on principles and methods of organic agriculture; (ii) lack of knowledge on the regulations and requirements for export of organic products; and (iii) lack of market information.

Currently there are no exports of organic fresh fruits and vegetables from Madagascar, whereas one company is processing organic fruits (pineapples, papaya, mangoes, guava and passion fruit) to pulp or juice for export. All produce, apart from passion fruit, is bought from certified small-holders. Certification is paid by the processor who is also the exporter. The total quantity of organic certified fruits is approximately 400 tonnes.

In the year 2000, 62 tonnes of pulp and juice were exported by one company to France. Export prices were about 20 percent higher than for conventional products.

According to an exporter of processed fruits, production of tropical pulps and juice could expand according to the demand of the market. Development of exports of organic fresh produce does not seem to have good prospects in the near future.

The practised quick certification due to chemical-free production of the past mislead companies to the assumption of feasible quick business as traders. Member companies of the former association BIO CÔTE EST attempted an export business of organic litchis, which were also collected from the wild by small-holders. This approach, however, underestimates the required efforts and the necessity of developing good logistics, which are needed for handling of fresh produce.

Other constraints for the development of exports of organic fresh fruits and vegetables include:

• Underestimation and neglect of logistics development;
• Lack of experience of intensive organic production in general and especially of fruits and vegetables;
• Lack of experience in handling and exporting of fresh produce;
• Lack of professional management; and
• Long distance to the markets, which reduces competitiveness.

Annex I
Contact details: certifiers, consultants and producers

ECOCERT INTERNATIONAL
Foerster Strasse 87
D- 37520 Osterode
Germany
Tel.: +49-5522-951 161
Fax: +49 5522-951 164
[email protected]

LACON GmbH
Weingartenstr. 15
d-77654 Offenburg
Tel.: +49-781-55802
Fax: +49-781-55812
[email protected]

Gabriel Guet, Organic Agriculture Consultant,
BIOHERB (on behalf of
GTZ/Protrade (94 to 96), FASP
(2000) and CDI (2001)
Address: La Bergerie - Les
Iles; 84840 Lapalud
France
Tel.: +33-4-90 40 30 82
Fax: +33-4-90 40 24 29

Mme. Lecacheur, PRO BIO
MAD International, Rés. Le
Donjon - pl. des Douves,
78960 Voisins-le-B.; France
Tel: +33-1-30 96 69 88
Fax: +33-1-30 48 97 44

Alexis Rabemananjara
Pabiom
P.O. Box 110
Antalaha 206
Madagascar
Tel: Phone: +261-32 07 161 58
Fax: 0049-7741 60 92 20
[email protected]

Annex II
Exports of Organic Products from Madagascar in 1999 and 2000

Products	Quantities in kg 1999	Quantities in kg 2000
Cacao	967 800	1 142 740
Sugar	908 790	726 000
Palm oil	323 460	216 350
Coffee robusta	210 045	350 410
Coffee arabica	7 550	18 950
Processed fruits	46 900	* 62 400
Black pepper	12 500	17 200
Green pepper preserved in brine	4 420	10 800
Vanilla	8 640	14 890
Vanilla extract	350	30
Cinnamon	7 690	5 520
Cinnamon extract	-	10
Turmeric	2 025	1 050
Ginger	-	1 280
Cloves	1 645	8 290
Clove stems	-	700
Chillies	1 435	875
Nutmeg	564	525
Macis	28	135
Red pepper/Red berries, (Schinus molle)	590	400
Essential oil of Ylang Ylang	2 319	3 500
Essential oil of Niaouli	1 600	825
Ess. oil of Ravintsara	980	725
Ess. oil of clove stems	645
Sum of other essential oils	1 205	2 006
TOTAL	Ca. 2 511 000	Ca. 2 590 000