Context and background
Despite Karnali being known as the most remote, poor, and food insecure region in Nepal, it offers good prospects for developing high value commodity chains (including temperate fruits, off-season vegetables, vegetable seeds, and non-timber forest products inter alia). Although the large majority of the districts in the region still remain inaccessible via road, the opening of the Karnali Highway renders connectivity to some mountainous districts to Nepalgunj. This is one of the major market hubs through which products can make their way to India as well as other market centres in Nepal.
Jumla, despite being one of the most mountainous districts in the region, is the largest apple producing district in the country, contributing 19.4% to the country’s total apple production. More than 10,000 farmers are involved in apple production (Ministry of Agriculture & Co-operatives and SNV Nepal, 2011). In Nepal more than 37,000 metric tonnes (mt) of apples, worth more than US$12 million are imported from India and China. Annually, only about 10% of the apples from Jumla make their way out of the district.
Presently, the rough road from Jumla to Surkhet remains partly closed during the monsoon, which also coincides with the apple harvesting season. This poses a challenge in the marketing of Jumla apples, despite huge demand in urban market centres. It is expected that road access will improve within the next two years. In view of this and in combination with increasing demand for Jumla apples, potential for impact, pro-poor growth potential and an increasing interest among companies willing to buy apples from Jumla, SNV decided to develop a High Value Agriculture Inclusive Business pilot, financed by the International Federation of Agricultural Development. The main thrust of the pilot was to connect Jumla apples to the national market by facilitating links between agribusinesses and apple producers.
BH Enterprises is a private company which has been involved in the apple business since 1996. The company currently imports around 2,000 mt of apples from China and India annually. The company is also engaged in wholesaling, retailing and Direct to Home (DTH) services in Kathmandu. Established in 2008, the Organic World and Fair Future (OWF) is an emerging value based company, associated with the International Federation of Organic Agriculture Movement (IFOAM), Nepal Permaculture Group and Fair Trade Group Nepal. OWF has been sourcing and distributing various organic products in Nepal. Its products are sourced from places certified by Organic Certification Nepal (OCN), NASA and ECOCERT, as organic. It has been marketing fresh vegetables, seasonal fruits including Jumla apples, dried beans and pulses, honey and cereals.
Incentives for these two companies to engage in the project and aid in the sourcing apples from Jumla are economic related – there is an increasing demand for Jumla apples as they are considered to have a unique taste and quality; and marketing related – Jumla apples enable companies to profile themselves as socially responsible and environmentally friendly; as well as supply chain related – securing and optimising their supply of apples