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Cluster Group Uvs Aimag

Cluster Lead: S.Serjim

Cluster members: 15

Seabuckthorn companies in Aimag: 86 companies. 244 cultivators.

Hectars of cultivation: 614,58 hektares

Yield per year: 416 tons ( in 2016)

 

Development of the seabuckthorn value chain in Uvs

  1. Participation of members of the clustergroup Uvs and representatives of the National Fruits and Berries Association in the Industrial Fair in Guangzhou (4/2016).

  2. Training on seabuckthorn varieties, transplanting seedlings, irrigation and fertilization with a total of 106 participants (5/2016).

  3. Starting tests with vacuum-harvesters for seabuckthorn and working on their adaptation to meet the local conditions in collaboration with the Geno Fund company (June 2016, still ongoing).

  4. Training on plant diseases, insect infestation and the responsible use of pesticides with 54 partic-ipants (6/2016).

  5. Development and dissemination of a book for recording agricultural practices in seabuckthorn cultivation (6/2016).

  6. Cooperation with the Food Research Centre (FRC) of the Mongolian National University of Sci-ence and Technology (MUST) for research on the chemical, genetic and microbiological content of seabuckthorn from Uvs and analysis of samples from members companies of the cluster group (6/2016, still ongoing).

  7. Training on hygienic processing of seabuckthorn, transport, storage and labelling techniques with 79 participants (8/2016).

  8. Analysis of samples of seabuckthorn oil and juice by accredited laboratory in Germany (8/2016).

  9. Study tour to cultivators and processors of seabuckthorn as well as research institutions in Ger-many (9/2016).

  10. Preparing for the “Seabuckthorn Cultivation and Harvesting Centre” located at the Uvs Chamber of Commerce and Industry. The Centre will function as a kind of “machinery ring”, where machines can be rented (10/2016, still in preparation).

  11. Consultancy towards FRC on quality management of laboratories (ISO 17025) by German expert (3/2017)

  12. Training on seabuckthorn varieties, maintenance and harvest by an expert from Russia (8/2017)

  13. Consultancy for cluster group regarding doxin, irrigation, plant diseases and insect infestation by a German seabuckthorn specialist (6/2017).

  14. Study tours of Cluster group to Barnaul and to

Seabuckthorn cluster Ulaangom/Uvs: Summary of the survey results 2015 – 2017

1. Introduction

This report summarizes the results of surveys on key data relating to the cultivation and processing of seabuckthorn in Ulaangom Soum of Uvs Aimak. The regional chamber of Uvs collected the data in three consecutive years during the winters of 2015/2016, 2016/2017 as well as 2017/2018. They depict the situation as per the end of 2015, 2016 and 2017 respectively. The information was mainly collected through interviews by phone and partly by visiting the farms. The error margin is estimated at around 10%. This means that the data collected might deviate from the real situation by up to 10% in either direction (either under- or overstating).

2. Facts and figures

Table: Key figures of the seabuckthorn sector in Ulaangom Soum 2015 - 2017

No. Item End 2015 End 2016 End 2017 Comments
1. Number of producers and processors 222 out of 231 growers recorded a harvest. 46 small businesses have processed berries mostly into juice and oil. In addition 18 did processing for domestic consumption. 142 out of 170 growers recorded a harvest. 15 small businesses have processed berries mostly into juice and oil. In addition 38 did processing for domestic consumption. 115 out of 129 growers recorded a harvest. 33 small businesses have processed berries mostly into juice and oil. In addition 22 did processing for domestic consumption. 2016:
89 planters who recorded a harvest in 2015 did not harvest anything in 2016.
9 planters not engaged in seabuckthorn cultivation in 2015 recorded a harvest in 2016.
2. Size of cultivation area 472 ha cultivated with seabuckthorn 301 ha cultivated with seabuckthorn 347,5 ha cultivated with seabuckthorn Cultivation means whether the plantations are being taken care of. There may be areas with sea buckthorn shrubs which are left abandoned for either a shorter or longer period.
3. Number of farms with a sea buckthorn cultivation area of 1 ha and below 134 (= 58%) out of a total of 231 growers. 110 (= 64%) out of a total of 170 growers. 44 (= 34%) out of a total of 129 growers.  
4. Number of farms with a seabuckthorn cultivation area of 10 ha and above 6

4

5 2016: 2 of the larger farms have reduced their seabuckthorn cultivation area from 45 (2015) to 8.3 and from 11 (2015) to 2 ha.
5.  Number of seabuckthorn shrubs 430,326 302,255 316,885  
6. Number of newly planted seabuckthorn seedlings 30,651 47,140 13,900  
7. Number of farmers who planted new seabuckthorn seedlings 25

94

13  
8.

Production of seabuckthorn berries

433 tons

207 tons

407 tons  
9.

Volume of processed seabuckthorn berries in tons and as percentage of the total harvest

148 tons (34%)

77 tons (37%)

149 tons (37%)  
10.

Production of seabuckthorn juice

97,700 litres

55,600 litres

157,173 litres  
11.

Production of seabuckthorn oil

1,360 litres

932 litres 2,229 litres  
12.  Sales prices of seabuckthorn fruits 2,764 MNT per kg on average.
Range between 1,800 and 4,000 MNT per kg
 2,572 MNT per kg on average.
Range between 1,500 and 3,800 MNT per kg
 2,671 MNT per kg on average.
Range between 1,500 and 4,500 MNT per kg
The average price is calculated by the sum of prices mentioned by the farmers divided by the number of farmers. It is not weighed by the volume of seabuckthorn berries sold at a particular price.
13.   Sales prices of seabuckthorn juice 6,438 MNT per litre.
Range between 5,000 and 9,000 MNT per litre
6,313 MNT per litre.
Range between 5,000 and 9,000 MNT per litre
 6,682 MNT per litre.
Range between 6,000 and 10,000 MNT per litre
See above
14. Sales prices of seabuckthorn oil 23,300 MNT per litre on average
Range between 18,000 and 32,000 MNT per litre
 23,100 MNT per litre on average
Range between 20,000 and 30,000 MNT per litre
22,730 MNT per litre on average
Range between 20,000 and 30,000 MNT per litre
See above

3. Analysis

Fewer sea buckthorn growers and less land cultivated by sea buckthorn …….
The figures indicate a clear decline in the number of primary producers. While in 2015 222 growers harvested sea buckthorn their number declined to 142 as per the end of 2016 and to 115 in the following year. The production figures do not follow this trend in the same way. While the size of the area cultivated with sea buckthorn indeed decreased from 472 ha (2015) to 301 ha (2016), it increased to 347 ha by the end of 2017. This increase is mainly due to the fact that plantations which had suffered from flood and hail storms in 2016 were rehabilitated in the following year. Still the area under cultivation has significantly shrunk between 2015 and 2017. This might be attributed to small farmers operating small plots in a semi-professional fashion having abandoned cultivation. Probably they realized that sustainable sea buckthorn farming requires an investment in time and effort they would not be willing or able to come up with. This assumption is supported by the fact that the share of small sea buckthorn farms of less than 1 hectare compared to the total number decreased from 64% in 2016 to 34% in 2017.

…….and a substantial increase in yields.
In 2016 natural calamities led to a dramatic plunge in the harvest of sea buckthorn berries which had fallen from 433 tons (2015) to 207 tons. By the end of 2017 407 tons were harvested thus almost reaching its former level. Taking into account the continuously shrinking number of farms it means that the sector has increased its productivity. While in 2015 0.92 tons were harvested per hectare, yields reached 1.17 tons per hectare in 2017, a gain of 27%. Productivity will be further enhanced by the fact that many shrubs will gradually start bearing fruits from 2018 onwards. Almost 92,000 shrubs, representing 29% of a total stock of 317,000 shrubs, are young and were planted only recently in the years 2015 up to 2017.

Processing reaching record highs
According to the data obtained the production of sea buckthorn juice reached more than 157,000 litres in 2017 which is 60% above the figures recorded for 2015. Sea buckthorn oil follows this trend: An amount of 2,229 litres was recorded in 2017, 64% up from the 2015 figure (1,360 litres). Nominal prices remained remarkably stable during the period. The average sales price for berries varied between 2,764 MNT per kg in 2015 and 2,671 MNT per kg in 2017, for juice between 6,438 MNT per litre in 2015 and 6,681 MNT per litre in 2017. The average sales price for seabuckthorn oil equally saw only minor changes between 23,300 MNT in 2015 and 22,730 MNT in 2016. It should be noted that the data on prices were not weighed according to the volumes of products sold at a particular price and are therefore distorted to some extent.

4. Conclusions and outlook

a) The decline in primary production experienced in 2016 as a result of natural calamities was largely offset in 2017 when normal weather prevailed. The available figures indicate that the harvest in sea buckthorn berries in 2017 was only slightly below the harvest in 2015. This was achieved with a smaller area of sea buckthorn cultivated and with fewer farmers still engaging in the sea buckthorn business. These changes point to strong productivity gains which are calculated at 27% between 2015 and 2017. Probably the productivity improvements can be attributed to the ProValue activities of which a fair amount dealt with professionalizing primary production. Further productivity gains can be expected in the near future when young shrubs will reach harvesting age.

b) The volume of processed products, namely juice and oil, from sea buckthorn berries has also increased markedly. These figures still need to be double-checked as the increase of 60% and more since 2015 is very steep. If they can be confirmed to some extent and even considering a substantial margin of error it means that processing has become more prominent at the expense of selling unprocessed berries. Assuming that the sea buckthorn juice and oil have actually been sold on the market it would mean that substantial value addition has taken place. However the existing survey design is not geared towards collecting information on real sales of processed goods so that there is not enough information available to confirm that value addition is a reality.

c) Nominal prices remained highly stable despite fluctuations in production. So far there is no conclusive explanation for this phenomenon as one would normally assume prices following the available amounts of sea buckthorn products.

d) The recommendations spelled out after last year’s analysis of the survey remain valid:

  • The project/sea buckthorn cluster needs to build the productivity of primary production in sea buckthorn in order to minimize vulnerability to external shocks and to further build competitiveness;

  • The project/sea buckthorn cluster needs to invest in new products in order to diminish its dependence on a few products and to develop new markets;

  • The project/sea buckthorn cluster needs to improve access to existing markets to which the cluster does not yet have access to. These might include export markets (Russia, China, Japan) but also domestically.