Casey Maue, a PhD student in the Emmett Interdisciplinary Program in Environment and Resources alogn with Woods Institute Senior Fellow, Erica Plambeck, spent time this spring examining the oil palm supply chain in Ghana. Casey is a 3rd year PhD student and is advised by FSE Director Roz Naylor and FSE Senior Fellow Marshall Burke. Casey's research focuses on the economic dimensions of agricultural development in Sub-Saharan Africa, and the economic impacts of climate change on the agricultural sector. In his dissertation chapter focused on development in the oil palm industry in Ghana, Casey is examining how the provision of informal financial services (such as access to trade credit or informal savings) by different buyers (processors) in the oil palm supply chain determines farmers' output-market decisions, and how relational contracts between farmers and processors that provide access to these informal services can be leveraged to increase supply chain productivity, and the welfare of smallholder oil palm farmers.
Casey and Erica traveled to the municipality of Juaben, located in the Ashanti region of central Ghana, and conducted focus group discussions and in-person interviews with numerous stakeholders working in oil palm. They visited with oil palm farmers and buyers of their fruit – palm oil processors. There are two kinds of palm oil processors in the Ghanaian supply chain, small-scale artisanal mills and larger industrial mills, which compete with each other for the fruit produced by smallholder oil palm farmers. Through this research, Casey and Erica sought to better understand the economic forces that affect a farmer’s decision to sell their fruit to an industrial versus an artisanal mill. Doing so will provide insights that processors can use to design more effective incentives for their suppliers that will increase the quantity and reliability of fruit delivered to them. Fostering more consistent, and trusting relationships between farmers and processors is key to increasing the productivity and profitability of enterprises all along the supply chain, to increasing food security for poor oil palm farmers, and to promoting effective private governance of oil palm’s environmental impacts.