Analysis of factors influencing the supply chain of red palm oil: case study complexe chimique d’Afrique central
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The main purpose of the study was to analyze the factors affecting the supply chain of palm oil in CCAC s.a. The analysis of these factors will be passed through the examination of the palm oil supply chain structure in the littoral region and the actors involved in this chain.
This is to have a clear idea about the different channels that the palm oil produced or imported in the country takes to reach the end consumer and also to identify the different factors influencing the entire channel. In order to address the problem issues, the researcher conducted a series of interview with the main actors involved in this particular domain (suppliers, processors, wholesalers and retailers) and referred to secondary data sources.
The collected data and information were compiled and analyzed for possible indications of the problem issues.
We found from the study that the main factors influencing the palm oil supply chain are the following: suppliers prefer to supply their oil to the closes company from their procurement point in other to reduce their transportation cost, inadequate quality control system of palm oil produced by the majority of industries of press and processing companies is negatively affecting chain, competition among the suppliers due to the gap between the demand and supply of palm oil in the country is motivating the situation of non-contract among the actors, the fact of importing all the essential raw materials of the refining process from other countries is fragilizing the chain, the trading condition without a contract is favourable for both suppliers and processors presently, seasonality is also influencing the performance of processors.
It was finally recommended a series of measures that the company should take in order to improve the current situation at is own level. Because it is clear that they are certain factors that can not be managed only by the company but a good integration of the actors involve in the chain will bring a considerable improvement in the chain.
Palm oil (Elaeis guineensis) is one of the most important economic oil crops in Cameroon. Cultivation of oil palm serves as a mean of livelihood for many rural families and indeed the farming culture of millions of people in the country. The reference to oil palm as a crop of multiple values underscores its economic importance.
Oil palm is a product that can be consumed in several ways due to its ability to generate other sub-products such as stearin, oleine, fatty acid. Apart from oil palm which is an important agricultural resource in Cameroon; the country also has other natural resources in abundance such as mineral resource including precious gold, metal and petrol; wood and water resources.
With a population of 23.44 million (2016), Cameroon is the fifteenth-most populous country in Africa. Agriculture is the foundation of the Economy in the country and it is justified by the fact that agriculture employs 70% of the population, contribute to 42% of the Gross Domestic Product (GDP) and constitute 30% of the exportation of the country. Apart from crude petroleum, exportation in Cameroon is dominated by cocoa beans, swan wood, rough wood, cotton and bananas.
Major agro-industrial companies in Cameroon are the following: The Cameroon Development (CDC) which is the largest single employer after the State, with 25,000 employees, produces palm oil and palm nuts, tea, rubber and banana (makossa and sawa banana).
Cameroon rubber company (HEVECAM) manages 15000 hectares of rubber plants and the manufacturing industry with a capacity of 26,412 tons of rubber and an employment roll of 4,300 full-time workers. The cotton development company (SODECOTON) based in Garoua has 1,527 workers operating 8 factories that produce 152,815 tons of cotton, 62,808 tons of fibre, 76,340 tons of triturated grains and 11,345 million litres of oil on average per year.
Cameroon sugar company (SOSUCAM) produces more than 60,000 tons of sugar per anum and employ 4000 people. Cameroon Oil Palm Company (SOCAPALM) for its part produces more than 50,000 tons of palm oil and more than 9000 tons of palm nuts per anum.
Palm oil Plantation (PAMOL) based in Lobe, the south-west region, produces palm oil, laundry soap and, to a certain extent, robber. Others such as SEMRY in the North and Upper Noun Development Authority (UNVD) in the North West region are involved in rice production. (2012-2017 Startline Limited).
With a good observation, we realize that the majority of Agro-industries in Cameroon are specialized in palm oil production and in contrary of all what might thing the country is still importing palm oil. This is due to the fact that the production of all these agro-industries is not sufficient to satisfy the demand of the country.
The forgone analysis is to indicate the importance that needs to be given to the palm oil supply chain and understand the factors influencing each actor involved in this chain. Simply for the fact that compare to other products which are very easy to trace their source, it is very difficult or almost impossible to identify the source of given palm oil when this arrives in our local market.
In the year 2014 the deficit of palm oil in Cameroon was estimated at 200000 tons and to fill this, the Ministry of Finance gave the authorization to import 65000 tons for the year, 60000 tons in 2015 and 45000 tons in 2016. This year (2017) the deficit is estimated at 130000 tons and to fill the country has decided to import 95000 tons (Camer be).
All this palm oil is imported from different countries which are Thailand, Indonesia and Gabon. The forgone analysis sounds very strange when we know that the majority of the biggest Agro-industries in Cameroon are specialized in palm oil production. Another element very important to rise up is the fact that the supply of palm oil in our local market has not shown a considerable change. Added to the first two arguments we can also add the fact that
all the palm oil that is imported is not found in our local market. All these elements just enumerated is attracting our attention on the channels that take the palm oil production and/or imported in Cameroon. That is why the answers of the following questions will be the main purpose of this research.
- How are the major actors involved in the palm oil supply chain related to each other?
- What are the different stages of palm oil produced or imported in Cameroon?
- What are the factors influencing each supply stage of the supply chain?
The general objective of this study is to analyses the different factors that influence the supply chain of the palm oil sector and give some recommendations or ideas on what the actors involved in the sector can do to improve the sector.
The specific objectives include:
- Examine the flow of the palm oil product throughout the supply chain of the product.
- Identify the major actors involved in the supply chain of palm oil product.
- Analyze the different factors influencing each actor at each step of the supply chain.