Enhanced value added solutions for pineapple product contributing to increase income for poor households in Tien Giang province

MISNISTRY OF EDUCATION AND TRAINING CAN THO UNIVERSITY NGUYEN QUOC NGHI ENHANCED VALUE ADDED SOLUTIONS FOR PINEAPPLE PRODUCT CONTRIBUTING TO INCREASE INCOME FOR POOR HOUSEHOLDS IN TIEN GIANG PROVINCE ABSTRACT OF DISSERTATION Specialization: Agricultural Economics Code: 62 62 01 15 Can Tho, 11-2015 The research was completed at Can Tho University Supervisors: Assoc Prof Mai Van Nam Opponent 1: Opponent 2: The dissertation will be defended before the council of the school level at: hour date month year Learn about the dissertation in the library: - Learning Resource Center – Can Tho University - Vietnam National Library CHAPTER INTRODUCTION 1.1 RATIONALE The study demonstrates the urgent and high practical significance based on the following establishments: (i) Tien Giang has the largest raw materials of pineapples in Viet Nam with over 15,000 (Tien Giang Statistical Office, 2014 ) and pineapples are considered “Tree of poverty reduction” of Tien Giang province, (ii) the potential market of pineapple industry is more growing, especially the US, EU, Japan, Korea ( FAO, 2013), (iii) The link among the actors in the pineapple product chain in Tien Giang is still very “fuzzy”, (iv) there are many points “unanswered”, towards valueadded (VAT) of pineapple product which had not been studied and exploited properly, (v) The received value of poor households who planting pineapple was inappropriate to the investment and the their cultivating exist many risks, (vi) Value Chain is an effective approach of managers, policy-makers aiming to improve the income of poor households Thus, the issue is given to tackle: (1) Improving the received benefits for poor households who have been planting pineapple through improving the value-added of pineapple products; (2) enhancing the VAT for the pineapple products through the value chain upgrading Therefore, the study of solutions to improve the value added pineapple products contributed to improved income for poor households in Tien Giang province This should be considered as a subject with high imperatives 1.2 RESEARCH OBJECTIVES 1.2.1 General objective The dissertation aimed to analyze the activities of the stakeholders involved in the pineapple value chain in Tien Giang province and analyze the VAT, VAT distribution between the stakeholders who are in the pineapple value chain as well as detect the bottlenecks that need to improve in order to enhance the economic value of the chain, through which proposed a number of solutions to improve the income of poor households who have been planting pineapples in Tien Giang province 1.2.2 Specific objectives The specific objectives of the dissertation need to be addressed as follows: (i) analyze the production and consumption situations of pineapple products of the poor households in Tien Giang province, (ii) analyze the activities of the stakeholders involved in the pineapple value chain as well as the VAT and VAT distribution among the stakeholders who are in the pineapple value chain, (ii) Compare the VAT between groups of pineapple grower (the poor, the non-poor) and the impact of VAT distribution to income towards group of pineapple producers in Tien Giang Hamlet, (iv) Propose solutions to enhance the value added for the pineapple products contributing to improve the income for poor households in Tien Giang province 1.3 RESEARCH QUESTIONS In this dissertation, the research question should focus on resolving the following: (1) What is the situation of production and consumption of pinapple products of the poor households in Tien Giang province like? (2) How much does each stakeholder involved in the value chain created the value added for the pineapple products like? (3) How is the distribution of VAT among the stakeholders in the pineapple value chain? (4) What are measures and policies implemented to enhance the VAT of pineapple products as well as improve the income for poor hosueholds in Tien Giang Province? 1.4 RESEARCH OBJECTS AND RESEACH SPCOPE Research objects: VAT generated in each stakeholder who participated in Tien Giang pineapple value chain as well as the distribution of VAT and net VAT of stakeholders in the value chain which are the research objects of the dissertation In particular, solutions aims to improve the income of the poor, through it, it focuses on enhancing the VAT in the pineapple value chain Space scope: The Tan Phuoc pineapple materials (pineapple productivity accounted for over 99% of Tien Giang province) Research space of the stakeholders in the value chain was expanded by the method of linking the value chain of GTZ (2007) Time Scope: Research time was determined just ended at the time of the study, it means that the most recent harvest pineapples The research period for each stakeholder will be allocated by the method of linking the value chain Content scope: The VAT of pineapple products influenced by many random factors and existed outside the control of the households (natural disasters, epidemics), these elements are not mentioned in the dessertation Due to limited resources, the dissertation didnot analyze the pineapple export value chain in international consumer markets Besides, in the processing of the value chain, the content-related analysis of the value of waste after processing (martial pineapple, crushed pineapple) is not mentioned and analyzed in this dissertation CHAPTER 2: LITERATURE REVIEW 2.1 RESEARCH FOR THE VALUE CHAIN DUE TO THE POOR Pro-poor growth is one of the goals outlined the most in promoting the development of the value chain (ADB, 2007; FAO, 2004) Pro-poor growth emphasized the importance of work to for the poor to participate directly in production, in economic growth and independence on social welfare (FAO, 2004) Agricultural Policy Support Service Organization of FAO has developed the guidance towards the value chain analysis for the rural development and the poor The methods begin with a comprehensive analysis of economic or agricultural areas which are the most important Based on the evaluation of the factors that make a distinction between the poor and the rich in the value chain, the manufacturing subsectors are determined in accordance with the poor Due to development purposes for the poor, the Asian Development Bank studied to build of practice modular towards the value chain analysis which titled “The making value chain more efficient for the poor” or “ The marketing performance booster for the Poor” (ADB, 2007) This is a very appropriate approach to the study of agricultural products, particularly products related to the poor According to ADB (2007), the starting point and the orientation of value chain analysis of ADB is to improve market efficiency for the poor 2.2 RESEARCH FOR THE PINEAPPLE VALUE CHAIN Applying of the value chain theory GTZ (2007) and combining tools for the poor DFID, Lirne (2009) conducted the study on the pineapple value chain in SriLanka The study showed that the growers cultivated pineapple with small scale and they did not have any rights to negotiate the business The study had proposed the establishment of cooperatives to increase the ability to negotiate and support households minimize transaction costs The study of Preeyanat (2013), it studied on the balance between supply and demand for the canned pineapple value chain in Thailand Besides the application of the value chain theory, Preeyanat (2013) also used the quantitative models to identify factors that influence consumer decision-canned pineapple and factors affecting output pineapple in production Results showed that demanding for canned pineapple was higher than fresh pineapple; this was the premise of cannedpineapple technological processing development in Thailand Applying the value chain theory of Gereffi (1994), Linda (2011) studied the efficiency of in Ghana through a value chain analysis Research results indicated that the bio-pineapple production cost was not large, households produced with small scale which was not undermined by production costs and gained high profits Moreover, households who have been growing bio-pineapple product could sign contracts with pineapple exporters in Ghana In addition, the study confirmed that the pineapple production followed safety standards and brought many profitable and better selling prices than normal production 2.3 RESEARCH FOR ADVANCING THE VALUE ADDED OF AGRICULTURAL PRODUCTS David et al (2000) found out approaches for researching the VAT of agricultural products The first is innovation; this approach focused on improving the existing processes, procedures, products and services Gjerding et al (1997) suggested that awareness of innovation was limited by its usefulness in economics and management Overall, the value added innovative activity development on the farms or agriculture laboratory was the national source of growth through changed in the type of product or production technology (Kraybill and Johnson, 1997) In addition, technological innovation method was a specific type of innovation The second was the coordination; this approach focused on the arrangement between the producers and agricultural markets Horizontal coordination related to the synthesis, integration of individuals of the same level of the value chain Longitudinal coordination included in contracting, strategic alliances, licensing agreements and sole ownership of the market in many different stages of the value chain (Peterson and Wysocki, 1997) Stern et al (1996) proved that the effective market included in many factors: appropriate products related to consumer tastes, profit margin in the relationship between marketing costs and profit, seasonal price and uniform price between markets Besides, the results of USAID (2008) also pointed out the factors of the market efficiency including: price level and stability, net profit, profit and cost, quantity and quality products Lambert et al (1998) showed that there are two ways to increase the VAT, the first way is to improve production efficiency, thereby expanding the amplitude between the value of output and intermediate input costs, and the second way is changing the form, function, quantity and characteristics of product to increase the disparity between the value of output and input costs 2.4 OVERVIEW OF LITERATURE REVIEW Through overview domestic and foreign materials related to the agricultural value chain, especially the study of pro-poor value chain, increasing value of agricultural products Table 2.1 indicates the source of document, content successor to the dissertation and some broken slot found in the reference documents Table 2.1: Overview literature review Sources Viorel Leahu et al (2011), Hualiang Lu (2006), Tran Tien Khai (2011), Nguyen Phu Son (2012), Vo Thi Thanh Loc (2014) Identifying broken slot The study approached the theoretical value chain of Kaplinsky & Morris (2001) and “Linking value chain – ValueLinks” GTZ (2007) succeeded in assessing the impact of the economic value chain to local society, Combining research the value-added products for each market based on two channel, ability to participate in the value perspectives both socio- chain of the household However, these economic and studies have not demonstrated statistical Fullbright administration issues, significance in terms of the impact of the Consultancy (2008), upgrading the value value chain or the value added of agricultural Mahesh Ghimiray chain products to the household income, not clarify (2007), Peniel Uliwa differences, differences in VAT, VAT (2010), Zuhui Huang distribution of household groups in the value Zhejiang (2009), chain Anita msabeni (2010) ADB (2007), Vo Thi Thanh Loc et al(2011), Cong Thang et al (2004) Lirne (2009), Preeyanat Eapsirimetee (2013), Linda Kleeman (2011) Nguyen Van Hoa (2011), Nguyen Trinh Nhat Hang (2013), Tran Thanh Truc et al (2006) Content successor Most research focused on analyzing the stakeholders involved in the value chain, the value-added of products through stakeholders in each major market channels, some research divided according to domestic channels and Research results are export channels Few research have focused fundamental to propose on the households, especially the poor, which policy in order to were learned about VAT, net VAT generated promote the from group of households in the value chain participation in market and factors affecting the VAT and net VAT for the poor of them The impact of the use of resources to the economic efficiency towards households in the value chain as well as the content “unanswered”of many researches on the agricultural value chain Inapproach, detailed analysis of the household resources, the ability to use inputs Look at the of households but just exploit the value chain characteristics of from households to consumers This is the stakeholders involved most important bottleneck of Vietnam’s in the pineapple value agricultural sector, because farmers who chain, analysis of major produce products that people are investing a market channels lot of efforts and enthusiasm but are subjected to the most disadvantaged in the value chain A strong understanding of the technical The research focused on technical aspects of characteristics of producing pineapples and solutions to pineapples and propose enhance pineapple productivity, less solutions to improve the attention to socio - economic efficiency technical efficiency Increasing the VAT for David Coltrain et al agricultural products (2000), Gjerding et al through improving (1997), Peterson production efficiency, Wysocki (1997) thereby expanding the Quattri Maria spread between the value (2012), Lambert et of the product and the al (1998) cost of inputs Not focused on exploiting efficiency of the household market as well as identify causes that made decrease in the value of agricultural output markets This is the key point that need to exploit in agricultural product market in Vietnam Source: Synthesis of author 2.5 APPROACH METHODOLOGY AND RESEARCH FRAMEWORK 2.5.1 Approach methodology The dissertation applied the approach “input” for the efficiency of agricultural production of Farrell (1957) and “output” of the value chain of Kaplinsky & Morris (2001), the method of linking the value chain of GTZ (2007) and enhance the market for the poor (ADB, 2008) Measuring the effectiveness of agricultural production of Farrell (1957) The value-added and income of the poor who are pineapple growers The value chain of Kaplinsky and Morris (2000), method of approach to the value chain of GTZ (2007) and tool of supporting for the poor (M4P) Source: Proposed by author Figure 2.1: Way to research approach 2.5.2 Research framework Based on the approach the domestic and foreign findings through evaluating literature review, to address the research objectives given, the research framework of the dissertation was proposed as follows: Source: Proposed by author Figure 2.2: General research framwork With the proposed research framework, the dissertation focused on detecting bottlenecks towards efficiency of input resource utilization and bottlenecks of input market efficiency In particular, bottlenecks on the efficient use of inputs are detected through the approach of production efficiency of Farrell (1957); Whereas the bottlenecks of market efficiency is determined through the value chain approach of Kaplinsky and Morris (2001), GTZ (2007) and ADB (2007) SWOT matrix analysis (strengths, weaknesses, opportunities, threats) for the value chain is essential for establishing the strategic upgrading of the pineapple value chain Through it, promoting the value added of pineapple products aiming to improve the household income for the poor households who have been participating in the value chain CHAPTER 3: METHODOLOGY 3.1 DATA COLLECTION 3.1.1 Secondary data The information about the area and pineapple productivity in Tien Giang province was collected from Tien Giang Statistical Office (2014) The information on the situation of production, area and productivity of Vietnam pineapple was collected from the website of the Centre for Information and Statistics - Food Security Information (http://fsiu.mard.gov.vn/) and information about the situation in the world pineapple production obtained from the statistical website of the FAO organization (http://faostat.fao.org/) 3.1.2 Primary data Primary data was collected according to two methods which are quick interview participatory (PRA twice at the study area) and direct interviews with each of the stakeholders in the value chain of the pineapple in Tien Giang following the appropriate sampling method (households were selected by the conditional quota method and other stakeholders were selected by the method of liking the value chain of GTZ (2007) Table 3.1: The object survey of the dissertation No Stakeholders in the chain Agricultural supplies dealers Seed production facilities The poor households growing pineapple The no-poor households growing pineapple Traders Pineapple granary Wholesalers Processing businesses Retailers Chain supporters Total Source: Survey data, 2014 Number of observation 98 128 20 15 12 37 10 335 3.2 DATA ANALYSIS Data Envelopement Analysis (DEA) was used to analyze the pineapple production efficiency of the poor, thereby identifying the bottlenecks in the use of input resources of the poor At the same time, the Linear Regression Analysis was used to determine the elements of household resources that affect to the pineapple production efficiency of the poor Toolkit value chain analysis was used to illustrate the diagram of the value chain, analyze the value added of the pineapple products and the distribution of value-added between stakeholders in the value chain Sensitivity analysis method was used to evaluate the impact of VAT, the distribution of the VAT to income of households growing pineapples Methods of SWOT matrix analysis and expert consultants were used to make the scientific basis for proposing solutions to improve the value added of pineapple product contributed to improve the income for the poor households in Tien Giang CHAPTER 4: FINDINGS AND DISCUSSIONS 4.1 SITUATIONS OF PINEAPPLE PRODUCTION AND CONSUMPTION OF THE POOR HOUSEHOLD 4.1.1 Situation of pineapple production of the poor household Pineapple seed: The poor households used the Queen Pineapple seed accounting for 88.78%, others used Cayen, Spanish and some seeds are unknown origin Origins of pineapple varieties which was cultivated by poor households are diverse There was 24.49% of poor households use own pineapple varieties, 27.55% of poor households buy seeds from traders but no clear information about the type of seed, while about 23.47% of poor households had to buy or asked from neighbors Information about production techniques: The information of poor households was accessible mainly from extension officers (accounting for 48.98%), followed by the local acquaintances (occupying 37.76%), and the Farmer’s Association also was quite important (accounting for 29.59%) Capital investment in production: Poor households used capital of loans accounted for 50% For the loans of the poor, Bank for social policies was prioritized loans (accounting for 52.27%), Bank for Agriculture and Rural Development was 42.05% of households Some poor households accessed the capital from associations, acquaintances and private loans Cultivation area: According to the survey results, the average area of cultivating pineapples of the poor household was 9,083m2 In particular, the leased land accounted for significant proportion Most poor households have colonized the area planted under 10,000 m2 (accounting for 61.23%) 4.1.2 Situation of pineapple consumption of the poor Forms of communication with buyers: According to the survey, the poor households were active to contact the buyers (representing 84.86%) However, the buyer proactively contact to the poor accounts for 13.13% Poor households have sold pineapples through intermadiates which was very little (approximately 1.10%) Output market of the poor: The majority of the poor households have sold pineapples for long distance traders (accounting for 75.52%) Enterprises were also a significant output stakeholder for poor households (accounting for 15.70%) Moreover, poor households sold pineapples to wholesalers/ pineapple granary (accounting for 8.08%), retailers or local traders Forms of price decision: This represented the negotiating power of poor households in the market Poor households themselves decided price which was very little (accounting for 3.06%), mostly pineapples were sold at market prices (accounting for 68.37%) and the buyers decided (representing 28.57%) 4.1.3 Pineapple efficiency production of the poor Based on estimated results of technical efficiency (TE), allocative efficiency (AE) and cost efficiency (CE) of poor households produced pineapples (Table 4.1) showed that poor households produced pineapple achieved technical efficiency which was relatively high, while distribution efficiency of resources and cost efficiency stayed at an average level Table 4.1: The pineapple production efficiency of the poor Value of efficiency 1.00 0.90 – 0.99 0.80 – 0.89 0.70 – 0.79 0.60 – 0.69 0.5 – 0.59 0.4 – 0.49 < 0.40 Average (optimum efficiency) Standard deviation Technical efficiency 19.39 7.14 14.29 22.45 20.41 13.27 3.06 0.00 Allocative Efficiency 0.00 1.02 4.08 16.33 31.63 25.51 9.18 12.24 0.769 (19) 0.589 (0) 0.448 (0) 0.161 0.144 0.144 Cost efficiency 0.00 1.02 4.08 3.06 2.04 17.35 33.67 38.78 Source: DEA analysis redults from survey datat, 2014 Note: (optimum efficiency): A number of households reached at optimum efficiency; According to the estimated results TE, AE and CE (Table 4.1) showed that poor households produced pineapples achieved production efficiency at average level The average level of technical efficiency of poor households was 0.769 that was correlative width (0.479 to 1.0) This result implied that the poor should have used about 76.9% amount of the input to get productivity levels In addition, the results also suggested that households had TE less than which should conducted to minimize the inputs to practice saving and achieve technical efficiency Allocative efficiency of poor households growing pineapples reached at average level (AE = 0.589), in the range from 0.224 to 0.952 The results also showed that the cost efficiency of the poor household was low and large degree of dispersion There is no household achieved the optimum cost efficiency (CE = 1) This result showed that the total production cost of poor households should fall to 55.2% if they just reached pineapple productivity at current With the current level of productivity, DEA analysis results (Table 4.2) showed that the poor wasted a lot of inputs, especially waste of seeds, fertilizers and family labor Note: * The proportion of output distribution volume is calculated based on the following formula: Volume sales of the ith stakeholder th % distribution of stakeholder A to output the i stakeholder = x 100% Total volume inputs of stakeholder A ** The corresponding proportion of the value chain is the rate (%) of the pineapple flow that is consumed through the stakeholders which is calculated based on the total proportion of pineapple input from previous stakeholders (except households) which has a weight is a percentage of each product sold stakeholders For example: 27.27 x0.11 % pineapple flow of traders sold to pineapple granary = 100 Input Production Collector Processing 0.11% 10.95% Pineapple granary 1.85% 10.87% 5.67% Wholesa ler in level 9.02% 0.03% Labor market (renting labor) 0.11% Wholes aler in level 46.88% 50.23% Loacal trader Househo ld 71.44% 65.62% Dosmestic consumer Retailer 0.01% 0.07% Agricultural supplies dealer Consuming Trading 13.14% Long-distance trader Business 11.49% 28.71% 17.22% Seeding production base European, Korean, Japanese consumers 0.28% Quyet Thang (winning decision) cooperation Extension system Department of rural development Investment and trade promotion center Department of science and technology Research institute of southern fruit Credit institutions (Bank for social policies, Bank for agriculture and rural development Source: Survey data, 2014 Figure 4.1: Diagram of the pineapple value chain in Tien Giang 4.2.2 The key channels in the value chain of pineapple products Overall, the pineapple value chain in Tien Giang is operated through many market channels However, there are major market channels transporting the volume of products which generated high value added for the whole chain The remaining channels were mainly intermediate channels or there was product flow passing very little In the fifth primary market channel, channel 1, channel and channel had an important role, consumed large quantities of fresh pineapple production in the domestic market While, channel and channel created products as processed pineapples and exports Channel (households => long-distance traders => wholesalers in level => retailers => domestic customers) Channel consumed the most pineapple products of whole chain Most households sold pineapples to long – distance traders (accounting for 71.44%) Then long - distance traders shipped pineapples to the wholesale market in Ho Chi Minh City (Hoc Mon and Binh Dien market ) There, pineapples were distributed for wholesalers in level who came from the districts of HCMC or from the south eastern provinces by long distance traders (representing 12 46.88%) Wholesalers in level continued to distribute products to retailers at the “satellite markets” around Channel (households => long-distance traders => retailers => domestic consumers) After harvesting, the pineapple volume of households was sold to long – distance traders (accounting for 71.44%) Long distance traders not only sold to wholesalers in level 2, they but also sold directly to retailers (mainly retailers in Ho Chi Minh City) The amount of long distance traders sold directly to retailers accounted for 13.14% of the total of chain The retailers would then distribute pineapples to consumers (at the market, street vendors, and trolleys) Channel (households => pineapple granary => wholesalers in level => wholesalers in level => retailers => domestic customers) Through surveying, approximately 10.95% of the pineapple output was sold to the pineapple granary These pineapple granary focused on some communes of Tan Phuoc district (Hung Thanh, My Phuoc and Tan Lap 2) The pineapple granary could buy pineapples at the farm or farmers could also take the pineapple to pineapple granary The pineapple granary was built near river or roads to facilitate for big means of transportation (trucks, boats) Then pineapples were distributed to wholesalers in level (representing 10.87%) to get price fluctuation Wholesalers in level had transports with large capacity to buy pineapple pineapple granary Then they sold pineapples to wholesalers in level (accounting for 9.02%) at their business place, wholesalers in level continued to distribute to retailers Channel (households => long-distance traders => businesses => exports) Similar to channel and channel 2, traders bought pineapples with high volumes from farmers However; there was a difference of product rank from channel It meant that after collecting the pineapple from farmers, traders classified pineapples into many different kinds If most of pineapples were type 1, traders would transport to wholesale markets in Ho Chi Minh City, the products were type and type were moved to the processing businesses for consumption (accounting for 11.49%) Sometimes, if pineapple was low quality (small, ugly shape), long-distance traders would make a bulk purchase pineapple without classifying Channel (households => businesses => exports) Households not only sold pineapple to pineapple granary and traders; they but also sold directly to processing enterprises Volume of pineapples were sold by households to processing enterprises accounted for 17.22% the total output of the whole chain When selling pineapples for processing enterprises, farmers could sell the pineapple with many different levels (due to businesses were not fussy fruit size) After the collecting, the enterprises would process pineapple products (canned, frozen, solid) exported to different markets such as the EU, South Korea, Japan and so on 4.2.3 The value added and net value added of stakeholders in the key channels of the value chain In the primary channels of pineapple product, each stakeholder would like to generate VAT and regain different net VAT Table 4.5 indicated the VAT and net VAT of stakeholders in the major market channels of the pineapple value chain 13 Table 4.5: The value added and net value added of stakeholders in the major of the pineapple value chain Unit: VND/kg Households Pineapple Traders Wholesalers Wholesalers Businesses Retailers Items granary in level in level Channel 1: households => long - distance traders => wholesalers in level => retailers => domestic customers Selling price (1) 5,130.93 6,952.62 9,589.33 11,632.28 Intermediate cost (2) 630.97 5,130.93 6,952.62 9,589.33 Value added (3) 4,499.96 1,821.69 2,636.71 2,042.95 Additional cost (4) 1,419.25 548.36 585.07 325.74 Net value added (5) 3,080.71 1,273.33 2,051.64 1,717.21 % net value added (6) 37.93 15.68 25.26 21.14 Channel 2: households => long-distance traders => retailers => domestic customers Selling price (1) 5,130.93 6,677.70 9,238.80 Intermediate cost (2) 630.97 5,130.93 6,677.70 Value added (3) 4,499.96 1,546.77 2,561.10 Additional cost (4) 1,419.25 548.36 665.74 Net value added (5) 3,080.71 998.41 1,895.36 % net value added (6) 51.56 16.71 31.72 Channels 3: households => pineapple granary => wholesalers in level => wholesalers in level => retailers => domestic customers Selling price (1) 5,306.87 6,040.17 6,945.76 9,589.33 11,632.28 Intermediate cost (2) 630.97 5,306.87 6,040.17 6,945.76 9,589.33 Value added (3) 4,675.90 733.30 905.59 2,643.57 2,042.95 Additional cost (4) 1,419.25 359.56 464.14 685.07 325.74 Net value added (5) 3,256.65 373.74 441.45 1,958.50 1,717.21 % net value added (6) 42.03 4.82 5.70 25.28 22.16 Channel 4: households => long-distance traders => businesses => exports (customers) (*) Selling price (1) 5,130.93 5,530.00 9,344.25 Intermediate cost (2) 630.97 5,130.93 7,676.69(**) Value added (3) 4,499.96 399.07 1,667.56 Additional cost (4) 1,419.25 267.02 1,325.83 Net value added (5) 3,080.71 132.05 341.73 % net value added (6) 86.67 3.72 9.61 Channel 5: households => businesses => exports (customers) (*) Selling price (1) 5,050.00 9,344.25 Intermediate cost (2) 630.97 7,196.69(**) Value added (3) 4,419.03 2,147.56 Additional cost (4) 1,419.25 1,625.83 Net value added (5) 2,999.78 521.73 % net value added (6) 85.18 14.82 Source: Survey data, 2014 Note: (3) = (1) – (2); (5) = (3) – (4); (6) = (5)/𝛴𝑛𝑒𝑡𝑉𝐴𝑇 (*)Channel of low rank consumption was higher than others (**)IIncluding material cost (buying pricef) and additives to processed pineapple products Households: Households were an actor playing production role which created the first value added for the pineapple in the value chain VAT due to households produced in the market channel was quite high, ranging from 4,419.03 to 4,675.90 VND/kg Channel (sold to pineapple pineapple granary) was a channel which created the highest VAT This was the reason that farmers received the highest net VAT as 3,256.65 VND/kg At channel and channel 5, farmers created VAT and regained lower net VAT than channels 1, 2, because the pineapples of two channels which mostly brought the low level were suitable for processing enterprises When considering the percentage of net VAT distribution in market channels, farmers were always the stakeholder received the highest net VAT distribution, ranging from 34.35% to 86.67% 14 Pineapple granary: was one of the intermediate stakeholders transporting the quite volume of whole chain In channel 3, this actor created value added as 733.3 VND/kg and received 373.74 VND/kg net VAT, while the distribution of net VAT of pineapple granary was 4.82% The reasons that net VAT and the percentage of net VAT distribution of pineapple granary were quite low due to specific activities of the pineapple pineapple granary which only especially transported the product to get price fluctuation at the time of business Long-distance traders: this was a stakeholder which presented at most of channels of value chain Long-distance traders brought pineapples to many markets and distributed them to next actors in the value chain The range of VAT which traders created in the channel as from 399.07 to 1821.69 VND/kg; corresponding to net VA, traders regained from 132.05 to 1273.33 VND/ kg pineapples If calculated per unit of product, channel was a channel that long distance traders created the highest value added and got the most net VAT Channel was a channel which consumed the pineapple kinds of low rank, so this also created the lowest value-added channel for long-distance traders The rate of net VAT distribution at channel and channel of long-distance traders was about 16.0% While at Channel 4, long-distance traders only got net VAT distribution as 3.72% Wholesalers in level 1: A commercial actor played an important role in the channel 3, wholesaler in level collected pineapple from pineapple granary and distributed them to the wholesalers in level In this channel, wholesalers in level generated VAT as 905.59VND/ kg and received about net VAT as 441.46 VND/ kg Correspondingly, the proportion of net VAt distribution of wholesalers in level received at the channel as 5.7% Wholesalers in level 2: as agent’s next long-distance traders and wholesalers in level and wholesalers in level were also a significant role in distribution activities towards pineapples to the domestic markets At channel and channel 3, wholesalers in level generated VAT respectively 2,636.71 VND/kg and 2,643.57VND/kg and regained net VAT as 2,051.64VND/kg and 1,958.50 VND/kg When considering the percentage of net VAT distribution in market channels, wholesalers in level was an actor which received high net VAT distribution (after farmers producing pineapples), equivalent to 25.0% Processing enterprises: At channel and channel 5, the enterprises were actors contributing to increase the additional value for the pineapples through processing operations and exports At Channel 4, the value added created by businesses calculated per unit’s products as 1,667.56 VND/kg and received net VAT as 341.73 VND/ kg, the percentage of net VAT distribution of business in this channel was 9.61% While at channel 5, businesses generated VAT as 2,147.56 / kg and received about net VAT as 521.73 VND/kg and the proportion of net VAT distribution of business received 14.82% Thus, collecting pineapples from farmers helped businesses create the value added and get the net VAT better Retailers: In the domestic market, retailers were actors that could bring fresh pineapples to consumers In the market channels, VAT created ranges from 2,042.95 to 2,561.10 VND/kg and received net VAT respectively from 1,717.21 to 1,895.36 VND/kg pineapples In particular, channel was a channel that retailers generated the 15 highest added value and get the most net VAT Correspondingly, the proportion of net VAT distribution also was the highest with a value of 31.72% This suggested that, if reduced commercial intermediaries, retailers would increase profitability and improve the rate of profit distribution 4.2.4 The net value added and allocation of the net value added of the poor and non-poor in the key channels In each market channel of the pineapple value chain, the poor and non-poor households received net VAT and the percentage of net VAT distribution were very different The difference of net VAT and the rate of allocation between groups were shown in Table 4.6 below Table 4.6: Net value added and Net value added distribution of the poor and non-poor in the pineapple value chain The key market channels Channel Channel Channel Channel Channel Unit: VND/kg Non-poor households Poor households VAT (VND) 4,233.75 4,233.75 4,170.89 4,300.40 4,219.38 Net VAT(VND) The proportion of distribution (%) 2,582.36 2,582.36 2,519.50 2,649.01 2,567.99 32.04 29.70 32.37 80.73 79.06 VAT (VND) Net VAT(VND) 4,732.49 4,732.49 4,832.29 4,689.88 4,609.03 3,490.96 3,490.96 3,590.76 3,448.35 3,367.50 The proportion of distribution (%) 40.87 38.04 43.34 84.05 89.26 Source: Survey data, 2014 In channel and channel 2, the poor received 2,582.36 VND/ kg when they sold pineapples for long-distance traders Although net VAT of poor households received as the same as for selling long-distance traders in channel and channel , the percentage of net VAT distribution that poor households received was different from the market channel (32.04%) market and channel (29.7%) Net VAT of poor households in the channel when sold to pineapple granary as 2,519.5 VND/ kg, this value was lower than the channel and channel 2, but the percentage of net VAT distribution of the channel was higher than both channel and channel 2, the ratio was 32.37% In market channels and (channel of export market), poor households received VAT equivalent to channel 1, and 3, however, the percentage of net VAT distribution was received which was highest (from 79.06 % to 80.73%) Thus, the the Net VAT of channel export market improved, the poor would receive as much net VAT distribution Compared net VAT and he rate of net VAT distribution between the non-was always higher than than the poor The difference of net VAT between non-poor was higher than the poor around 1,000 VND/ kg and net VAT distribution rate equivalent to 10% in almost all market channels The main reason to make up the difference in VAT and net VAT in pineapple production activities between the poor and non-poor households due to: (i) Input: Due to limited financial human conditions so the poor selected the poor quality inputs as well as farming followed the habitual which didn’t focus on the scientific mode of production It led to cause waste of inputs and lead to low productivity (ii) Outputs: Conditions for farming position were less favorable compared to non-poor households, the ability to negotiate lower decision, so the poor have sold products without high price The cause has made the poor create added value and get net VAT always regained lower than the non-poor 16 4.2.5 The value added and the value added allocation of actors in the pineapple product value chain Table 4.7 showed that farmer was the actor that created the highest value added with 4,515.67 VND/kg, corresponding to 30.78% of the whole chain Thanks to the activities of classification, wholesalers in level is the second actor which is the highest value added generated in the value chain, with 2,641.70 VND/kg, corresponding to 18.01% of the total value added of the chain Local traders created the lowest VAT which was 503.90 VND/kg accounting for only 3.43% of the value added of the chain With the intermediate costs in the whole chain was higher VAT generated by actors showed that collection, trading and processing of the chain was not really effective, these agents can not raise VAT by measures expanding between input costs and output prices, especially in processing Table 4.7: The value added and distribution of the value added of actors in the pineapple value chain Unit: VND/kg Households LongBusinesses Wholesalers Wholsalers Retailers distance in level in level traders Selling price (1) 5,146.64 5,653.90 6,040.17 6,548.82 9,344.25 6,945.76 9,589.33 11,032.28 Intermediate cost (2) 630.97 5,150.00 5,306.45 5,085.27 7,388.69 6,040.17 6,947.63 9,082.24 Value added (3) 4,515.67 503.90 733.72 1,463.54 1,955.56 905.59 2,641.70 1,950.04 % value added (4) 30.78 3.43 5.00 9.98 13.33 6.1 18.01 13.29 Prepaid cost (5) 1,419.25 343.74 359.56 548.36 1,475.83 464.14 635.07 365.74 % prepare cost (6) 25.29 6.13 6.41 9.77 26.30 8.27 11.32 6.52 Net value added (7) 3,096.42 160.16 374.16 915.18 479.73 441.45 2,006.63 1,584.30 % net value added (8) 34.18 1.77 4.13 10.10 5.30 4.87 22.15 17.49 Total costs (9) 2,050.22 5,493.74 5,666.01 5,633.63 8,864.52 6,504.31 7,582.70 9,447.98 Profits/costs (10) 1.51 0.03 0.07 0.16 0.05 0.07 0.26 0.17 Source: Survey data, 2014 Note: (3) = (1) – (2); (4) = (3)/𝛴𝐺𝑇𝐺𝑇; (6) =(5)/𝛴𝐶𝑃𝑇𝑇; (7) = (3) – (5); (8) =(7)/𝛴𝐺𝑇𝐺𝑇𝑇; (9) = (2) + (5); (10) = (7)/(9) Items Local Pineapple traders granary In other aspects, the net VAT was generated in the whole chain and net VAT of each actor gained corresponding with production efficiency/business of each actor Farmers and wholesalers in level were actors got net VAT and there were high production efficiency/business in the chain Total net VAT of chain was 9,058.03 VND/kg, which the net VAT of households contributing as 3,096.42 VND, accounting for 34.18% Overall, net VAT of actors got positive The research results also showed that the actor had high net VAT; output of production/business was low Therefore; when assessing investment performance, we need to consider two criteria was: capital cycle and actual volume of pineapple This issue will be discussed at the contents 4.2.6 4.2.6 Compare investment performance among the actors who involved in the value chain The results of the analysis (the 4.8) showed that, farmers are actors which had profit margin/highest costs, including non-poor households had profit margin/higher cost nearly times the poor With VND investment costs, poor households generated 1.12 VND profit, while non-poor households generated 1.9 VND In commercial actors, wholesaler in level was an actor which had profit margin/highest cost However, in order to assess the exact the efficiency of investment in business/production of each actor, it needed to consider yielding / year and pineapple production volume / transaction in the year of each agent According to 17 the calculation results (Table 4.8), although farmers were actors that created profit margins / highest cost but recorded only once in the first year of capital While other actors have some capital cycle times greater than households Moreover, with the huge volume of transactions, the commercial actors were subjected to effective operation than farmers many times Table 4.8: investment efficiency of actors involved in the pineapple value chain Profit margin 1.12 1.90 0.16 0.03 0.07 0.05 0.07 0.26 0.17 Objects Poor households Non-poor households Long-distance traders Local traders Pineapple granary Businesses Wholesalers in level Wholesalers in level Retailers Number of capital cycle/year(1) 1 60 75 92 84 60 60 Volume (ton/year) 12.18 30.39 2,177.55 1,404.12 2,606.99 17,807.16 2,180.42 113.67 43.56 Rate of return/year(2) 1.12 1.90 9.60 2.25 6.44 0.20 5.88 15.60 10.20 Source: Survey data, 2014 (1) number of capital cycle/year = number of operating days in he year /number of days capital cycle (2) rate of return/year = profit margin * number of capital cycle/year 4.2.7 Compare the pineapple value added of the poor and non – poor in the value chain The testing results on the VAT difference between the poor and non-poor households showed that the difference had statistical significance of VAT and net VAT The VAT of Pineapple product was created larger other by non-poor about 500 VND/kg and net VAT of non-poor households received which was higher than poor households about 1,000 VND/kg Indeed, a production resource of poor households was limited Lack of financial advantages makes the poor lose negotiating power when buying inputs Buying agricultural materials with paying at different times making use of price inputs rise Lower selling prices with higher production costs, it was the cause to the added value created on the low product and net VAT rregained to be lower Table 4.9: Compare the pineapple value added of poor households and non-poor households Indicators Unit Selling price Intermediate cost Value added Prepaid cost Net value added VND/kg VND /kg VND /kg VND /kg VND /kg Poor households Non-poor households 4,894.97 672.12 4,222.85 1,651.39 2,571.46 5,339.32 599.47 4,739.85 1,241.53 3,498.32 The level of The level of significance significance testing testing t* Levene* 0.001 0.000 0.251 0.068 0.040 0.000 0.365 0.000 0.073 0.000 Source: Survey data, 2014 *Note: The test results with confidence level 95%, corresponding to the level of significance α=5% 18 4.3 IMPACTS OF THE VALUE ADDDED AND THE VALUE ADDED ALLOCATION OF PINEAPPLE PRODUCT TO HOUSEHOLD’S INCOME In order to understand the extent of the impact of VAT and net VAT of the pineapple product of groups of poor and non-poor households, the results of the sensitivity analysis showed that VAT and net VAT, while increasing the VAT or net VAT by 1%, 5%, 10% or 20%, their income/1000m2 and income/non-poor households were higher the poor However, there is no discernible effect of the rise in VAT and net VAT that it would make farmers greatly improved For poor households, the numbers are more increase significantly to more difficult life, more needy Therefore, solutions to enhance VAT product of pineapples was very important for improving the income of poor households Table 4:11: The impact of the value added, net value added of pineapple product to income of poor and non-poor households Unit: VND Value added/kg Income /1000m2 Income /household Poor households Net value added/kg Income /1000m2 Income /household Value added/kg Income /1000m2 Non- poor Income /household households Net value added/kg Income /1000m2 Income /household Source: Survey data, 2014 Go up 1% 72,531 658,842 Go up 1% 44,167 401,195 Go up 1% 94,590 1,895,577 Go up 1% 69,813 1,399,058 Go up 5% 362,652 3,294,211 Go up 5% 220,833 2,005,974 Go up 5% 472,948 9,477,884 Go up 5% 349,067 6,995,292 Go up 10% 725,304 6,588,421 Go up 10% 441,666 4,011,948 Go up 10% 945,897 18,955,768 Go up 10% 698,133 13,990,584 Go up 15% 1,087,955 9,882,632 Go up 15% 662,499 6,017,922 Go up 15% 1,418,845 28.433,651 Go up 15% 1,047,199 20,985,877 Go up 20% 1,450,607 13,176,842 Go up 20% 883,332 8,023,897 Go up 20% 1,891,793 37,911,535 Go up 20% 1,396,266 27,981,169 Table 4:12: The impact of the distribution of value added and net value added towards pineapple products to income of poor and non-poor households Unit: VND %value added Income /1000m2 Income /household Poor households % net value added Income /1000m2 Income /household %value added Income /1000m2 Non-poor Income /household households % net value added Income /1000m2 Income /household Go up 1% 112,884 1,059,363 Go up 1% 126,379 1,186,006 Go up 1% 161,568 3,242,450 Go up 1% 159,577 3,202,486 Go up 5% 564,418 5,296,813 Go up 5% 631,893 5,930,028 Go up 5% 807,842 16,212,252 Go up 5% 797,885 16,012,431 Go up 10% 1,128,837 10,593,626 Go up 10% 1,263,785 11,860,056 Go up 10% 1,615,684 32,424,504 Go up 10% 1,595,770 32,024,863 Go up 15% 1,693,255 15,890,439 Go up 15% 1,895,678 17,790.084 Go up 15% 2,423,526 48,636,757 Go up 15% 2,393,655 48,037,294 Go up 20% 2,257,674 21,187,252 Go up 20% 2,527,570 23,720,111 Go up 20% 3,231,368 64,849,009 Go up 20% 3,191,540 64,049,725 Source: Survey data, 2014 In each market channel in the pineapple value chain, farmers would like to receive a different the rate of VAT and the net VAT distributions The influence of VAT and net VAT distributions to household income, particularly for poor households was very important According to research results, poor households were getting higher VAT and net VAT by pineapple yield Besides, selling price of non-poor household was higher than the poor Therefore, when income increased when the proportion of VAT and net VAT distributions improved of non-poor households were large difference compared to the poor However, the issue of concern was that if the poor were distributed VAT and net VAT which were higher, 19 it would be significantly increased From there, the ability to escape poverty will exist more 4.4 SOLUTIONS FOR ENHANCING THE PINEAPPLE VALUE ADDED IN CONTRIBUTING TO IMPROVE INCOME FOR THE POOR HOUSEHOLD 4.4.1 Solutions for advancing the pineapple value added in contributing to improve income for the poor household Solutions to enhance the value added contributing to improve income for poor households in Tien Giang who have been planting pineapples were proposed based on the scientific basis which was collected from result of situation analysis and PRA session, the solutions are as follows: Table 4:13: Base solution proposals and solutions to enhance the value added products contributed to improve income for poor households N0 Scientific basis The quality of pineapple seeds is significant concern because of unknown origin, affecting the yield and fruit quality The waste in the use of inputs, thus reducing the value added, reducing the profitability of pineapple growing households Access to market information is limited, affecting the market efficiency of poor pineapple plantation There is limitation in access to technique progress approach, level of approach affects to the production efficiency of the poor The positive impact of equity capital (financial human capabilities) of the poor to productive efficiency, affecting th added value and net value added of the poor The link between the actors in the value chain remains limited; the output market of the poor is unstable, affecting the development of pineapple industry Proposed solution Improving the pineapple seed, improving the seed quality, ensuring the same of quality as well as size of goods Changing the appropriate of farming practices, adjusting the input element to enhance the added value of products Improving the access to market information, access to support programs developed pineapple industry Improving the access to technical advances, changing the thinking of production, using of advanced production model Establishing the credit cooperation, enhancing its financial support for poor households growing pineapples Building and implementing the model of links to stabilize the output market for households growing pineapples Source: Proposed by author Solutions to enhance the pinapple value addded to improve household income for poor households were interpreted in detail as follows: First, improving the pineapple seed, improving the seed quality, ensuring the same of quality as well as size of goods: Quality of seeds has a directly influence on the productivity and quality of pineapple If there was no provider quality seed, poor households should actively improve pineapple seed following activities: First, the poor should not cultivate pineapple with life cycle too long, time saving stem pineapple should not last more than years Second, poor households should actively reach out to the grassroots agricultural extension to gain information and assistance 20 process of the projects supported by the the local Third, the poor need to actively create quality seed under the right guidance and technical processes like incubators Second, changing the appropriate of farming practices, adjusting the input elements to enhance the added value of products: In short term, when the production resources has not been improved, immediate solution for thouseholds who grow pineapple to save costs and increased profits as reduction of input quantity The adjustment parameter was presented in the table below: Table 4:14: Proposed Adjusted input factors of the poor Import of inputs Actual using Seeds (tree/1000 m ) 2,847.56 fertilizers (kg/1000 m ) 87.80 pesticides (litre/1000 m2) 78.43 Stone gase (kg/1000 m2) 0.57 Fuel (litre/1000 m ) 2.65 Reting labor (day/1000 m2) 2.00 Family labor (day/1000 m ) 12.32 Source: DEA result analysis from survey datat, 2014 Waste 83.60 14.00 32.64 0.14 0.68 0.18 1.71 Adjustable inputs (%) -2.94 -15.95 -41.62 -24.56 -25.66 -9.00 -13.88 Besides, the poor need focus on the quality of the raw material inputs such as fertilizers, pesticides and so on That was a decrease quantity, but it had to choose the quality of agricultural materials and conduct a distribution to be reasonable which it can ensure the quality of pineapple Third, enhancing the access to market information, access to support programs developed pineapple commodity: Accessing to market directly affects the market efficiency of pineapple growing households, the poor need to conduct the following contents to improve access to markets: First, organizing of joint production under crosslinking If enhanced cross-linking in the form of cooperative groups, the poor will be to share experiences, information and market support policies Second, poor households should actively participate in mass organizations to collect information, the local policy Third, actively participate in the training program, to actively capture market information through seminars Four, improving the access to technical advances, changing the thinking of production, using of advanced production model: In the long term, in order to improve production efficiency, the poor should focus on improving farming techniques pineapple Research results showed that households accessed to the technical progress that made the difference in productivity and better profitability pineapple plantation Local extension systems often organized technical training courses on growing pineapples, however due to the poorer households must spend time to earn extra income wage so they had few opportunities to participate On the other hand, poor households often focused on the immediate benefits, just join the training courses which were encouraged to participate by materials Therefore, at the individual level, the poor should take the time to accumulate more knowledge production and learn from the experiences of farmer’s good application of the technical process To the local government, in the organization of training should focus on the elements of time, simultaneously assigning staff with enthusiasm, dedicated to helping the poor Moreover, the training should be deployed directly in the field of poor households, so that they can receive an active and easier to implement 21 Fifth, establishing the credit cooperation, enhancing financial support for poor households growing pineapples: To help poor households improve financial advantages as well as its position in the process of buying the inputs in production, particularly agricultural supplies, “credit cooperatives” was the solution that it should be considered and encouraged by local government Capital should be combined from two sources: support from the state budget through programs of poverty reduction or nongovernmental organizations and funds raised from individuals with idle capital Credit cooperative groups would like to give poor farmers to borrow money to buy inputs at lower interest rates Credit cooperative groups should be organized, transparented and prior supported for poor households to plant pineapple Sixth, Building and implementing the model of links to stabilize the output market for households growing pineapples: In model houses, local authorities kept acting as coordinator, hold operations support, devised appropriate policy and resolved to the disputes arising in the implementation process as a leadership, while enabling other members to join a model in the most effective manner The role of scientists is researching new varieties of high yield, fewer pests, and good growth Transferring production process which was high quality of pineapples products for poor farmers as well as regularly trained how to organize management of the field, manage cooperative groups Processing enterprises kept an important role in enhancing the value of products through processing and exporting Besides, the processing enterprises performed contract-guaranteed outlet for poor households Poor households growing pineapple was the most important factor in the production model For the production of poor households were well run, the elements of capital, technology, market must be guaranteed In this model, special attention to the role of “conductor” of cooperatives in connection houses, cooperatives should demonstrate bridging role between households and markets through the promotion of trade, bridging between scientists and farmers through seminars of technique transfers, a bridge between the state and households in financial assistance, seeding supports and deployed technique progress to pineapple production, the bridge between farmers and enterprises to promote the activities of buying the products Processing enterprises  Managed and arbitrated  Planned material zones  Encouraged to perform good contract by some policies  Provided credit and agricultural materials  Supported experts and management  Businessed products Cooperatives and group of cooperatives The state  Opened services  Gave the market information  Had support policies PINEAPPLE GROWERS  Lacked of capital, information, seeding and science-technology,… Technology transfer (New varieties, production processes, organizational management, inforation)  Provided funding  Gave research projects RESEARCHER Source: Proposed of author Figure 4.2: Model links unsuring the output market 22  Information  Sponsor 4.4.2 Strategics for upgrading the pineapple value chain contributing to enhance the pineapple value added From research results combined with recognition from the PRA session, the bottleneck of the product value chain from production to consuming synthesized following criteria: Input - The poor quality of varieties, be degraded; - The high labor cost; - The impoverished land Production - The poor farming techniques; - Restriction on the resources; - Restricted access to market information; - The high loss proportion Processing Trading Consuming - The backward processing technology; - Less diversified products; - The unstable market - The high loss ratio; - The heterogeneous classification of grade; - The bad link level Source: Synthesized the research results by author, 2014 Figure 4.3: The bottleneck in the pineapple value chain The bottlenecks of the pineapple value chain in Tien Giang were evident that they were apparently showed in analysis of the weaknesses and challenges of the value chain In addition, the strengths and opportunities were also analyzed, evaluated to establish the basis for the formation of strategic upgrading the value chain which brought practical characteristics Through SWOT analysis matrix, the strategies to upgrade the value chain contributed to increase VAT for pineapples for was recommended as follows: First, strategics to increase productivity and improve quality Pineapple growers in Tien Giang mainly used substandard varieties which were unknown origin and used many cycle lives Therefore, there were uneven fruit quality and substandard To improve quality, increase productivity, farmers should use quality varieties with acknowledgment of source To this, the research units: Tien Giang Fruit Research Institute, Center of Agricultural Research in Tien Giang province that strongly need to “take part” in improving more quality seed pineapple After acquiring quality varieties, the authorities should facilitate the farmers who can have access to seedlings easily and quickly, ensuring that farmers have been wishing, they would like to pineapple quality Besides, the need for technical guidance to farmers clearly, so they would like to know the appropriate farming techniques and the correct procedure Particularly for households are going to provide seedlings really which they want to stick with pineapples, they can ask the relevant authorities to certificate or accreditate for seedlings Doing this can help farmers access quality seedlings and effective in terms of both productivity and quality pineapples Second, strategics for capacity management, organizing cooperative activities Currently, at the raw material pineapples, there is only Quyet Thang cooperative which is provider that provides the agricultural service, the cooperative not consumed output products for the households, the management and operation of cooperatives is not effective Therefore, need to restructure, reorganize cooperatives and enhance cooperative role for pineapple growers This issue is given to requirements for local authorities to choose leader which is capable professionals, strategic thinking and confidentials for cooperatives and dedication to community interests Cooperative board of directors should actively improve 23 leadership capacity and market access through the training classes, short-term training, actively enlist assistance from the agricultural sector and effectively mobilize resources from public Its greatest wish of households is to have stable output markets Thus, cooperatives are looking for stable output by signing longterm contracts with wholesale markets or supermarkets and processing companies Simultaneously, Quyet Thang cooperative was equipped processing house, packing which cooperatives should take advantage of the capacity of processing house to raise the VAT for the pineapple Farmers look for the effect is brought from the cooperative will actively participate in the activities of the cooperatives more, make more dynamic cooperatives Third, strategics for restructuring of distribution systems, market expansion To the effective distribution system, a restructuring should be conducted Rearranging the activities of actors as well as reduce some intermediate actors was ineffective Also, to expand the market, the actors in the value chain need to focus on discovering Southeastern and Central markets For export market, regardless of the market in Japan, Korea, Taiwan, Russia, EU with processed pineapple products and fruit pineapple with Japan, South Korea, Taiwan Investment Trade-Tourism Promotion Center - Trade in Tien Giang province and Tien Giang JSC Vegetables are keeping the central role in market expansion strategies Besides strategic export products traditionally processed pineapple, they need to research way to the preservation of fresh pineapple technology ensure standards for difficult demanding markets like Japan and South Korea In addition, it should promote the distribution system of fruit pineapple and processed pineapple in modern retailer channels, especially supermarkets and fresh fruit shop Currently, processed pineapples have not been known by many domestic consumers, so it lead to need to have a strategic distribution extensively processed products to contribute to improve the pineapple Tan Lap brand at in the domestic market Fourth, strategics for diversification of products made from pineapples There were no many products that made from pineapple in the domestic market The value added of processed products brings high value, so it should be more focused Therefore need a strategy for the development of processed products or diversification products from pineapple First, the processing enterprises should study measures to ensure the supply of raw material to the enterprise in the form of consumption, followed diversifying the products made from pineapple, such like candy pineapple, pineapple cakes, pineapple wine and so on In parallel, the design of packaging and protect just related to the environment and leave good impression to customers while ensuring low cost is issues that need to be focused on business leaders Besides, processing enterprises should collaborate with research institutions to improve the quality of processed products, lower product costs, take advantage of by-products to improve investment efficiency Fifth, strategics for exploiting and enhancing productive resources for farmers With strengths in the production of pineapple growers: the pioneering farmers and confidential with pineapple production processes achieve GAP standards, models packed pineapple processing house gain standards VietGAP in the materials, Strategies need to take advantage of this advantage to face the challenges of the market, especially the fierce competition of the countries in the region Raise the level of production, the application of advanced manufacturing processes to produce 24 suitable quality products for export to penetrate difficult markets is a very important job at the present To that, this strategy must focus on exploiting the available resources of the household, such as proper use of family labor force, combining efficiency between manufacturing experience and advanced production techniques progress (GAPstandards), using performance packed pineapple processing house Sixth, strategics for upgrading rural infrastructure In order to facilitate for collecting activities towards pineapples are well happened and reduce “transit fees” to people, help farmers to access the market easily, this lead to upgrade rural infrastructure which is very necessary For the infrastructure has deteriorated which need to upgrade, maintenance such as repairing to roads, bridges and dredging canal Regularly check water transportation system to promptly detect possible damage and repair plans Local authorities should encourage public-private partnership schemes (PPP) in the development program of rural infrastructure is crucial in order to enlist the resources of all the actors involved in the value chain as well as the uplifting test, monitor, protect rural infrastructure for the people Seventh, strategics for improving the market forecasting systems and diseases Aiming to support farmers catch quick information to plan in order to produce timely, it should enhance market forecasts activity Currently, the market research has not been adequate attention, enhance the market research will help farmers to avoid market risks Besides, farmers are clearly not aware of the situation of pest insects, so the need to guide farmers to identify pests, pest and how to avoid them Tien Giang is the largest raw materials in the country, therefore the agricultural sector should coordinate with concerned agencies to implement programs in the mass media market of fruits, particularly pineapples, or the Statistical research on the evolution of market prices in the country, as well as the situation of a pest to farmers who could cope with the risks in the best way CHAPTER 5: CONCLUSIONS Through the research results, the dissertation has solved these objectives, the key conclusions according to each specific objectives as follows: - The waste of poor households in using of input materials was huge from that leading to resource allocation efficiency and cost efficiency of poor households was quite low However, the ability to increase the efficiency of scale of poor households who have been growing pineapples was still high - There are market channels in the pineapple value chain in Tien Giang The pineapples were primarily sold for long-distance traders by households in these channels Products pineapple fruit from the households through actors and to consumers accounted for 71.29% of total pineapple productivity that were harvested by households Most of the actors involved in the value chain were positive in investment efficiency - Households are actors that generated the highest value added in the pineapple value chain, followed by wholesalers in level and business/enterprises Depending on market channels that there was difference among actors in the distribution of net value added However, in most of the major market channels, households planted pineapples 25 who were received the distribution of high net value added in chain, then wholesalers in level and retailers respectively - In all the criteria of price, value added, net VAT, the rate of VAT and net VAT distributions in the chain and non-poor households are not shown better efficiency so than poorer households - Value added and net value added were generated from the pineapple that strongly impacted to the income change of households who have been planting pineapples The proportion of value-added and net value-added distributions positively impacted to income of households growing pineapples in Tien Giang Province In particular, the influence of the proportion of value-added and net value added distributions to the nonpoor households were more the poor - There are seven strategies to upgrade the pineapple value chain contributed to improve the VAT for pineapples which were proposed as follows: (i) Strategic for increasing productivity and improving the product quality; (ii) Strategic for capacity management, organizing cooperative activities; (iii) Strategic for restructuring of distribution systems, market expansion; (iv) Strategic for diversification of products made from pineapples; (v) Strategic for exploiting and enhancing productive resources for farmers; (vi) Strategic for upgrading rural infrastructure; (vii) Strategic for improving the market forecasting systems and diseases - There are six measures which were proposed to enhance VAT of pineapple products that contributed to improve the income of poor farmers as follows: (i) Improving the pineapple varieties, improving the seed quality and ensuring the same of quality as well as size of goods; (ii) Changing the appropriate of farming practices, adjusting the input element to enhance the added value of products; (iii) Improving the access to market information, access to support programs developed pineapple industry; (iv) Improving the access to technical advances, changing the thinking of production, using of advanced production model; (v) Establishing the credit cooperation, enhancing its financial support for poor households growing pineapples; (vi) Building and implementing the model of links to stabilize the output market for households growing pineapples LIST OF PAPERS RELATED TO THESIS Nguyen Quoc Nghi & Mai Van Nam, 2014 Market accessibility of pineapple growing households in Tan Phuoc district, Tien Giang province Journal of Science, Can Tho University, No 35d, page 24-33 Nguyen Quoc Nghi & Mai Van Nam, 2015 Productive efficiency of pineapple growing households in Tan Phuoc district, Tien Giang province Journal of Science, Can Tho University, No 36d, page 1-9 Nguyen Quoc Nghi, 2015 Evaluate to economic efficiency of poor household in pineapple cultivation in Tan Phuoc district, Tien Giang province: Approach to profit function estimation of stochastic friontier analysis Journal of Agriculture and Rural Development, No (2015), page 16-22 26