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Cotton-based development in Sub-Saharan Africa? Global commodity chains, national market structure and development outcomes in Burkina Faso, Mozambique and Tanzania

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  • Staritz, Cornelia
  • Tröster, Bernhard

Abstract

Cotton is one of the most important cash crops in Sub-Saharan Africa (SSA) and has had an important role in job creation, poverty reduction and foreign exchange generation. SSA cotton exporters face particularly three interconnected challenges - how to increase yields and quality in the context of small holder farming; how to deal with volatile international prices; how to increase value addition through local processing. This paper analyses the cotton sectors in Burkina Faso, Mozambique and Tanzania along these challenges focusing on dynamics in global cotton commodity chains, different national market structures and related development outcomes. The aim of the paper is not to identify the best cotton sector organisation model but to point out issues that are important for positive development outcomes. The analysis shows that the more regulated systems in Burkina Faso and Mozambique generally outperform the liberalized system in Tanzania in terms of production levels, yields, input provision, and price stability. But there are also major differences among the more regulated systems with Burkina Faso faring substantially better in yields and farmers' price share. The state, however, also bears a greater risk in Burkina Faso through its involvement in the largest cotton company and the stabilisation fund. The system in Tanzania provides similar farmers' price shares as in Burkina Faso albeit with higher price instability and inequality. Tanzania has been further most successful in value addition which, however, cannot be attributed to the cotton sector market structure but primarily to a stronger manufacturing tradition. The institutional context in the cotton sector, particularly strong and independent farmers' associations, have a crucial role in all models to ensure that farmers' interests are respected.

Suggested Citation

  • Staritz, Cornelia & Tröster, Bernhard, 2015. "Cotton-based development in Sub-Saharan Africa? Global commodity chains, national market structure and development outcomes in Burkina Faso, Mozambique and Tanzania," Working Papers 54, Österreichische Forschungsstiftung für Internationale Entwicklung (ÖFSE) / Austrian Foundation for Development Research.
  • Handle: RePEc:zbw:oefsew:54
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    References listed on IDEAS

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    1. Claire Delpeuch & Antoine Leblois, 2013. "Sub-Saharan African Cotton Policies in Retrospect," Development Policy Review, Overseas Development Institute, vol. 31(5), pages 617-642, September.
    2. Ederer, Stefan & Heumesser, Christine & Staritz, Cornelia, 2013. "The role of fundamentals and financialisation in recent commodity price developments: An empirical analysis for wheat, coffee, cotton, and oil," Working Papers 42, Österreichische Forschungsstiftung für Internationale Entwicklung (ÖFSE) / Austrian Foundation for Development Research.
    3. Julie Dana & Christopher L. Gilbert, 2008. "Managing Agricultural Price Risk in Developing Countries," Department of Economics Working Papers 0819, Department of Economics, University of Trento, Italia.
    4. Poulton, Colin & Gibbon, Peter & Hanyani-Mlambo, Benjamine & Kydd, Jonathan & Maro, Wilbald & Larsen, Marianne Nylandsted & Osorio, Afonso & Tschirley, David & Zulu, Ballard, 2004. "Competition and Coordination in Liberalized African Cotton Market Systems," World Development, Elsevier, vol. 32(3), pages 519-536, March.
    5. Kaminski, Jonathan & Headey, Derek & Bernard, Tanguy, 2009. "Institutional Reform in the Burkinabè Cotton Sector and its Impacts on Incomes and Food Security: 1996-2006," Discussion Papers 290005, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
    6. Jeffrey Vitale & Marc Ouattarra & Gaspard Vognan, 2011. "Enhancing Sustainability of Cotton Production Systems in West Africa: A Summary of Empirical Evidence from Burkina Faso," Sustainability, MDPI, Open Access Journal, vol. 3(8), pages 1-34, July.
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    Cited by:

    1. Staritz, Cornelia & Tröster, Bernhard & Küblböck, Karin, 2015. "Managing commodity price risks: The cases of cotton in Burkina Faso and Mozambique and coffee in Ethiopia," Policy Notes 16/2015, Österreichische Forschungsstiftung für Internationale Entwicklung (ÖFSE) / Austrian Foundation for Development Research.

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    Keywords

    commodity-based development; cotton; price instability; value addition; Burkina Faso; Mozambique; Tanzania;

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