Local processing boosts local earnings

Households rarely generate enough income from gathering NTFPs (non-timber forest products) and selling them locally. Their retail value sold beyond local markets is far higher.

NTFPs can provide a viable livelihood, however, if collectors receive support to engage in local processing - to increase the value of their products and market them more effectively. The growing demand for Fair Trade and environmentally sustainable products is opening up opportunities for marketing NTFPs globally, although a lack of standards increases the threat of resources being overexploited. However, local markets requiring crude or semi-finished products are the main trading sites for most NTFPs.

Strategies such as local processing may contribute positively to poverty alleviation and conservation. This is particularly the case in remote markets (processing is rarely necessary for local markets, where customers have little money). Local processing is sometimes necessary for supplying remote markets, for example drying perishable products such as fruit, but it also adds value and strengthens the producer’s trading. Local processing can encourage local development for small local enterprises offering employment and training, and producer cooperatives that take over processing.

In addition:

• It provides diverse employment opportunities and creates additional income for local people.
• Revenues from the value-added chain remain within an area and are often used for reinvestment in local enterprises or for paying for education, health treatments, or goods such as bikes or televisions, for example.
• It can support cooperation in an area through the formation of cooperatives and trader associations. Processors also build networks with other enterprises in the area that provide the services and further materials for processing (such as packaging) as needed.
• Local producers have more power in business negotiations through local cooperation and through their position in the value chain, which is closer to the market.
• Processing also decreases pressure on local natural resources, as fewer raw materials are needed to earn a living and labour time is spent on processing activities rather than harvesting.
  

  

However, local processing is rarely initiated by the most marginalised. Reasons for this include the lack of access to NTFPs, credit and markets, as well as limited negotiating power and administrative capacity. To support local processing, non-government organisations and development initiatives need to:

• support local people in clarifying access rights to ensure sustainable harvesting
• help small local producers develop simple processing industries to create good quality products
• assist in marketing the finished products by making contacts, providing market analyses and giving training in administration where needed. 

Susann Reiner
Regenwald-Institut e.V., Postfach 1742, 79098 Freiburg, Germany
reiner@regenwald-institut.de

Rubber tapping in the Brazilian Amazon

Rubber tapper associations and small rural enterprises in the Brazilian Amazon work along the complete value chain.

As well as tapping latex, they produce cloth impregnated with rubber from which they make high quality bags and waterproof clothes.

They mostly work in the production stage and sell the processed product through short commercial chains (usually one intermediary). However, some cooperatives sell their products directly to consumers.

Through these initiatives, people gain about 10,000 percent of the income they receive for crude rubber:

• Rubber tappers earn about 0.56 Reais (R$) for 1.5 litres of latex but they make R$5.6 by producing rubber impregnated lamina, for which they need about 1.3 litres of latex.
• By tailoring bags and waterproof clothing from impregnated cloth, the rubber tappers earn between R$50 and R$55.

Even if they only produce rubber impregnated lamina, rubber tappers can still earn about 1,000 percent of the income they get for selling ‘crude’ rubber. Similarly, producing refined oil and soaps from seeds and fruits earns them over 1,000 percent more than selling the raw materials.