Value chain analysis of veneer- based engineered wood products in Mufindi District Tanzania
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Date
2024-05
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Sokoine University of Agriculture
Abstract
Processing tree logs into veneer-based engineered wood products
represents a crucial strategy for enhancing the efficient utilization of
forest resources, driven by dynamic factors such as the evolving
demand for versatile wood products in the construction industry.
This global shift is evident in the heightened market demand for
engineered wood products, underscoring the substantial contribution
of the forest sector to the economic growth and development of the
construction industry worldwide. In Tanzania, wood-based industries
play a pivotal role as primary sources of raw materials and
intermediate products for both local and international consumption.
The escalating production and demand for veneer, plywood, and
marine boards in the Mufindi District have prompted an exploration
of the potential of Veneer based Engineered Wood Products
(VBEWPs) through the value chain, recognizing the importance of
this sector in addressing evolving market needs and contributing to
economic development. This study aimed to comprehensively map
the actors involved in the value chain of veneer-based engineered
wood products, analyze their activities, assess the profitability of
these actors, evaluate the value added by each participant, and
explore challenges encountered throughout the value-added
distribution process. A cross-sectional study design was adopted
where a total of 152 actors involved in VBEWPs were sampled.
Interviews, focus group discussions, and key informant interviews
were used to collect data. Descriptive statistics, such as mean,
standard deviations, minimum, maximum, and frequencies. The
computation of key metrics, including Gross Profit Margin, Value
added, and Value added distribution. Additionally, Multiple
Response analysis was employed to analyze the challenges within
the VBEWPs value chain. Furthermore, the study utilized a linear
regression model to explore factors influencing returns on engaging
in VBEWPs, providing insights into the opportunities within this value
chain. Findings from the study revealed a separate structure within
the veneer-based engineered wood products (VBEWPs) value chain, comprising small and large-scale tree growers as the primary
actors. Profitability analysis indicated that tree growers, leading in
both chains, achieved substantial profits, with percentages of 79.4%
and 89.1%. Notably, value addition and distribution were
predominantly associated with processors, scoring 90.4% for
plywood and 91.83% for marine board. Furthermore, margins in
value distribution were leading, with percentages of 60.4% and 68%
in both small and large-scale chains. The study revealed actors in
the VBEWPs value chain, such as tree growers, brokers, traders,
transporters, manufacturers, suppliers, consumers, and regulators.
Furthermore, the study identified the main challenges faced by these
actors. Challenges such as fire, low prices, livestock invasion, poor
infrastructure, limited access to financial services, limited access to
improved tree varieties, conflicts among actors, high taxes, and poor
electric supply were highlighted by the majority of respondents. The
linear regression model results demonstrated that demographic
characteristics, specifically age, gender, and marital status,
significantly influenced returns on investing in tree growing among
tree growers (P<0.05). The study concluded that processing veneer-
based engineered wood products is a crucial economic activity that
ensures efficient use of resources from plantations, enhances
people's lives and reduces the depletion of forest resources. Hence
study recommended emphasizing the need for creating conducive
environments to strengthen the competitive advantages of local
producers in the VBEWPs industry and the significance of
cooperative associations for small-scale tree grower chain actors to
enhance their profitability and improve production.
Description
MSc Dissertation
Keywords
Value Chain Analysis, Wood Products, Veneer- Based Engineered Wood Products, Mufindi District, Tanzania