Laos: The Heat that Pays Off

In the majority of developing countries in the tropics, postharvest loss  is a severe issue. In extreme cases, up to 50% of vegetables are lost due to mismanagement after harvest. To study potential ways out, a look into the Greater Mekong Region may provide encouraging insight. AVRDC’s postharvest project, funded by the Asian Development Bank (ADB) and now in its second phase, has assessed the supply chains for five major vegetables in the Greater Mekong Region and found that average losses from farmer to consumer are 20-25%, and are worth US$2.6 billion to the region. The project is now developing pathways to help farmers avoid these extremely high postharvest losses. In Laos, farmers invest in processing chilies in a novel way and started a hot and spicy enterprise concept that has all chances to pay off.

In Laos, postharvest loss in chilies considerably decreases producers’ incomes. About 3/4 of all producers experience outright loss, or sell up to 50% lower than the market price for good quality chili.  The situation is set to change in the near future, and this change will be made possible through capacity-building offered by  the Center’s project office in Vientiane.

Starting in September 2007, farmer groups in eight villages have been trained on how to establish small-scale enterprises by training consultant Win-Win Kyi. Now the first group of alumni - three men and six women farmers from the small village of Donexiengxou - are ready to launch their own, novel business concept: To be the first in Laos to commercially produce dried chili and create a unique chili-sauce with blockbuster qualities.

Traditionally, Laos is an importer of dried chilies from Thailand, but Laotian consumers prefer the taste of local varieties. The proposed “buy Laotian” business concept could be a good marketing technique for other small ventures hope to carve out a niche.
To assure a high quality product, the group will make use of a chili solar dryer, a prototype of which was developed by AVRDC - The World Vegetable Center’s postharvest program in cooperation with both local public and private partners. The technology is cost-efficient and effective, and the expected revenues may soon recover the investment cost: With an initial investment of US$ 500, a price of 30,000 Kip (US$ 3.50) per kilo and a target production of approximately one ton of dried chilies a year, the fledgling business should show a profit right from the start.  And as product quality begins with good seed, the farmers’ group has expressed an interest in AVRDC’s chili lines and best practices in chili farming.

Read more on ADB funded postharvest activities at AVRDC - The World Vegetable Center here.