CCAFS flagship Project P53-FP1-SA-CIMMYT “Recommendation domains, incentives and institutions for equitable local adaptation planning at sub-national level and scaling up climate smart agricultural practices in wheat and maize systems”

Annemarie Groot & Jaclyn Rooker (Wageningen UR)

Exploring opportunities to scale out CSA in CSV through innovative business models

Contributions from CIMMYT, BISA ....

• Parvinder Singh

• Harminder Singh Sidhu

• Jeetendra P. Aryal

• M.L. Jat

• others

Members of cooperative Noorpur Bet

Outline

• Starting points and approach to business case development for scaling CSA

• Example: exploring business opportunities for cooperative in Noorpur Bet (Punjab)

• Issues for discussion

Our starting points for business cases development

• Focus on cooperatives to accelerate 1) out- scaling of CSA and 2) climate smart agro business development

• Innovation platforms at CSV level and beyond (Public–Private sector partnership) in leading position

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Innovation platform: ‘new’ institutional

framework driving innovation

Business case development: different types of product market supply chains

Business case development: supply – demand

Our aim:

• Bringing ‘technology/ capability’ push and ‘opportunity pull’ together

• Who demands what?

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Methodology for business case development

IDENTIFICATION

• WHO : Champion farmers, scientists, visionary knowledge carriers, designers

• Criteria : climate smartness, verifiable interest amongst stakeholders

DEFINING CASES

• WHO : Champion farms, opinion leaders, financial experts, scientists, engineers

• Criteria : Feasibility, market, investment, risk, yield, revenues

CONCRETE CASES

• WHO : Politicians, policy makers, financial experts, banks (power to realise), farmers/coop.

• Criteria : Value proposition, communication strategy, investment plan

PILOTING BUSINESS

CASES

• WHO : farmers in CSVs, Cooperatives

• Criteria : climate smart benefits, societal costs/benefits/ effectiveness, incentives and barriers

SCALING

• WHO : Meta level innovation platform

• Criteria : climate smart benefits, societal costs/benefits, effectiveness, incentives, barriers, risks

Criteria for defining pot. business cases

Moderate

Positive

Negative/

problematic

Innovation platform

In different phases different stakeholders

Example: Business case development - cooperative Noorpur Bet (Punjab)

• Cooperative since 1957 (745 members), good reputation

• Current provision of services as business case

• Interest in exploring new business opportunities through creation of added value products / new products

• Interest in taking part in Innovation platform and linking up with private sector

Income risk factors - challenges

• Depletion of ground water (1 ft per year)

• Declining soil fertily

• Climate variability – unpredictable weather

• Reduction in quality of product (breaking of rice)

• Crop losses due to temperature spikes and diseases

• Poor connection to the market (purchase of produce)

• High labour costs due to manual processes (e.g. transplanting of rice)

• Lack of knowledge in pesticide use

Nature

Yield

Input

Current CSA business case in place

• Products - services: LLL, Turbo Happy Seeder, tractor, loans, diesel...

• Customers: members and non–members,

• Value for customers

- Saving water with 30% (less irrigation time)

- Reduction in use of diesel (300-400 l / ha/year for the LLL)

- Increase in yield (125-200 kg/acre)

- increase in drought tolerance

- Less labour

- Timely service

- More precise application of fertilizers

- Net financial benefits almost doubled (THS)

• Costs: THS: cost- price125.000 Rs ; LLL: 125.000 Rs, tractor 60.000Rs; economic life....

• Revenues: Profitable.......

THS : window of 15 days

LLL: window of 30-45 days / once in 3- 4 years

• Key partners: research institutes (CIMMYT, BISA), PAU, Dept. of Agr.

extension workers, department of agriculture, LLL industry, THS industry..

• Key resources: government subsidies for LLL, THS .. and electricity

Scaling up business model: profit for government

o Reduction in energy use

o Reduction in air pollution – GHG emissions

o Reduction in water use

o Increase yield

o Increased climate resilience (more drought tolerant..

o Better insight into subsidy and support strategies (market distortion by subsidy in electricity.

For LLL if electric tariff equivalent to average costs of its supply then reduction in energy use will lead to higher fin. benefit

Future outlook: value chain perspective

LLL

diesel

HTS

Tractor

Loans

Others

Members

Non-

members

Cooperative

Noorpur Bet

Service provision Customers

Baby corn

Maize flour

Tomatos

Others

New and added value

products New

customers

Field

fresh

Chicken

industry

Field

fresh

Cooperative as accelerator of climate smart businesses

Farmers -

members

Help wanted - role of CCAFS?

• Identify low risk and climate smart business ideas

• Establish innovation platform

Next steps: low risk business ideas for business development (Noorpur Bet cooperative)

Idea Suggested by

Access to seeds Various farmers

Agroforestry Present in Punjab

Baby corn Fieldfesh

Banana Fieldfresh Direct Seeded Rice CIMMYT/CGIAR, Borlaug institute

Fodder production out of residue Fieldfresh

Grape Fieldfresh

Green Seeker CIMMYT

Laser land leveller machines CIMMYT

Maize – connecting to the poultry industry

Mechanical transplanter for rice Taraori village

Microfinancing schemes Noorpur Bet cooperative

Mill Noorpur Bet cooperative

Model for less harmful pesticides Various stakeholders

Organic farming Farmer in Noorpur Bet

Pomegranate Fieldfresh

Price security for produce

Rice cellar Noorpur Bet cooperative

Solar power for irrigation CIMMYT/Borlaug Institute

Subsurface drip irrigation CIMMYT/Borlaug Institute

Sweet corn Parvinder

Tomato farming Fieldfresh

Training of farmers (integrated pest management, soil health etc.) Institutes and Department of Agriculture

Turbo Seeder business development Dr. Hanuman Karnal

Value addition wast/side products Fieldfresh

Weather information systems Already present in Anjanthali

Zero tillage machines CIMMYT

Establishing innovation platform

• Farmers Noorpur Bet cooperative

• Field fresh Foods Private Limited

• CIPHET

• Ludhina Central Cooperative bank

• ICAR

• CIMMYT

• Society for Conservation of Natural Resources & Empowering Rural Youth

• Other investors...

• Poultry Feed Plant

• Others

Issues for discussion

• Should CCAFS focus more on cooperatives to out-scale CSA practices and accelerate climate smart businesses?

• Establishing - facilitation of innovation platforms: is there a role for CCAFS?

• Should we identify a basic set of criteria for assessing climate smartness of business ideas – business cases?

Production

process –

resource use

Market

Customers –

Consumers of

chicken meat

Product

Maize flour

Climate smart Climate smart?

Questions

Answers &