Lebanon’s Cornucopia: Value Chain Project Unleashes Potential of 10 Sectors
May 17, 2019
Six years ago, a DAI-led team went to Lebanon to learn everything there is to know about the country’s apples, avocados, cherries, grapes, honey, olive oil, processed foods, oregano, pine nuts, and rural tourism sectors. They recorded their findings—from identifying existing and new potential target markets, how many farmers grow the produce, which varieties they grow and how they market it, to what type of packaging they use. They also analyzed the barriers keeping these products from being sufficiently competitive and profitable in local and export markets: regional political instability affecting market access and making for unreliable export partners, the outdated varieties, generally poor reputation of Lebanese produce, inadequate planning for how to mitigate losses due to climate change and pests, no authoritative source of best practices, a lack of collective farmer associations to share those best practices and advocate for agricultural interests, and a pervasive hesitancy to invest in new technologies.
Armed with this assessment, DAI began work on the Lebanon Industry Value Chain Development (LIVCD) project, a U.S. Agency for International Development (USAID) Feed the Future initiative. Three of the value chains we targeted exemplify how the USAID project tackled these market barriers and created value for Lebanese farmers and food producers.
In 2012, Lebanon’s cherry value chain was in trouble. Consisting of roughly 5,000 serious farmers and another 5,000 hobbyists, the sector generated a reasonably good product—but there wasn’t much of it to export. In addition, the orchards were old and often suffering from root rot and other diseases. Even if farmers were to increase yields, there were too few cold storage facilities to keep the product chilled and ready for export. Good cherries have about a three-day lifespan if the cold chain is not properly maintained.
LIVCD set out to help producers and aggregators become a more reliable source of high-quality cherries in both domestic and international markets. A fundamental element of this vision was to introduce new varieties, address the root rot problem and the other diseases, improve post-harvest infrastructure and connect aggregators that have access to modern cooling and storage facilities with producers adopting the technologies and techniques essential to achieve higher yields and better cherries.
The team worked with farmers and aggregators to rehabilitate orchards, improve production techniques, improve post-harvest infrastructure, and provide training in Good Agricultural Practices. LIVCD provided direct technical assistance to 200 farmers who collectively cultivated more than 300 hectares. From 2016 to 2025, LIVCD estimates, the farmers who attended the trainings and improved their practices will generate cumulative discounted benefits of $2.2 million—reflecting an increase in the price of their cherries due to improved quality, enhanced shelf life, and reduced production costs. For every $1 LIVCD spent on technical assistance, the farmers gained $11.51 due to improved practices.
The team also worked with five owners of post-harvest facilities, which co-invested with LIVCD on all the activities.
Among the results of LIVCD’s assistance and activities in the cherry sector:
- 523 farmers and other value chain actors applied improved technologies, harvesting and post-harvesting techniques, and handling and storage techniques.
- 1,321 farmers and individuals received training on Good Agricultural Practices.
- 1,400 micro, small, and medium-sized enterprises (MSMEs), including farmers and other organizations, took advantage of business development services.
- 110 MSMEs received assistance in applying for and accessing financial services and loans.
- $150,000 in loans were disbursed to support MSMEs as a result of technical assistance.
- 103 women improved existing businesses or established new enterprises.
- 49 MSMEs benefitted from business linkages established by LIVCD.
- 817 jobs have been created or supported.
Watch the story of how LIVCD helped transform the cherry sector in Bcharreh.
Honey: How Sweet It Is
Things were slightly better for Lebanon’s beekeepers in 2012. As in the cherry sector, the volume of honey produced was low. But the popularity of Lebanese honey meant that exports to the Gulf countries and the United States were on the rise. Previous donor-funded quality-testing facilities had led to consumer confidence in the sector.
LIVCD’s experts decided to assist small-scale beekeepers to improve their yields and incomes; to work with large-scale honey producers to increase exports and purchases from small-scale beekeepers; and to leverage funds for investments in quality-control laboratories, queen bee production facilities, and wax recycling to reduce disease and improve yields.
The team engaged with cooperatives whose members include thousands of small-scale beekeepers scattered throughout Lebanon. LIVCD helped the cooperatives by expanding the number of hives and training members on how to improve production, extraction, processing, and yields. Nearly 1,500 beekeepers participated; 8,000 new beehives were added. Importantly, the project required that a beekeeper invests in one beehive for every three invested in by LIVCD. By 2016, the number of beehives in the country had doubled and the number of beekeepers had surpassed 10,000 (up from 5,545 in 2011, according to the Lebanese Ministry for Agriculture).
LIVCD also assisted honey exporters with improved branding and marketing—one exporter was able to sign a contract with grocery retailer Carrefour in the Gulf—and teamed up with the Syndicate of Lebanese Dieticians and private sector firms on a national campaign touting the benefits of honey.
Among the results of LIVCD’s assistance and activities in the honey sector:
- Honey production increased 75 percent between 2011 and 2016, according to LIVCD estimates.
- Honey producers began selling in 65 new market channels, including export markets.
- Small-scale beekeepers and cooperatives invested more than $500,000 in new hives.
- 4,150 beekeepers and individuals received training on hive management, disease control, and queen rearing and breeding.
- 2,534 beekeepers and other value chain actors applied improved technologies, harvesting and post-harvesting techniques, and handling and storage techniques.
Olive Oil: Heaven’s Richest Gift
If the olive tree is heaven’s richest gift, as Thomas Jefferson said, then Lebanon is rich indeed. Olive trees occupy approximately 20 percent of agricultural land. In 2012, however, most orchards were small and production standards traditional. Productions costs, accordingly, were high, handicapping the sector’s growth. Lebanon exported 3,200 tons of olive oil per year, mostly to the United States and the Gulf. Yet despite its export savvy and the fact that olive oil accounts for 7 percent of Lebanon’s agricultural GDP, the country still relied on imports of cheap oil, especially from Syria, for its domestic consumption.
The LIVCD team determined to lower production costs, improve milling and storing techniques, and raise the bar for marketing and branding—thereby enabling the large number of rural producers to earn additional income and keep Lebanon` competitive in the tight global olive oil market. LIVCD introduced mechanical harvesting, reducing costs by 50 percent; invested in modern mills, extending services to 500 farmers (up from 200) and increasing revenue by 80 percent for one cooperative; and upgraded brand labelling while helping to launch new olive oil lines.
Overall, LIVCD-assisted cooperatives, companies, and individual farmers have transformed the olive oil sector from one that was utilizing traditional and inefficient techniques to a modern value chain that produces a much higher percentage of high-quality olive oil at reasonable prices. The result is improved competitiveness in both domestic and international markets.
Among the results of LIVCD’s assistance and activities in the olive oil sector:
- 6,124 MSMEs received business development loans.
- 5,687 farmers and other value chain actors applied improved technologies, harvesting and post-harvesting techniques, and handling and storage techniques.
- 3,601 MSMEs benefitted from business linkages promoted by LIVCD.
- 3,305 jobs were created or supported.
- 3,494 farmers and individuals received training on Good Agricultural Practices, use of mechanical harvesters, and how to evaluate olive oil quality.
Private Sector in the Lead
LIVCD’s successes are likely to be sustainable because Lebanese firms, cooperatives, and farms took ownership of the upgrading efforts. LIVCD’s approach—entirely private sector-driven—began by building critical partnerships and playing a facilitating role rather than inserting the project into the value chains. From day one, the project engaged value chain lead partners as the key voices for mobilizing stakeholders in support of upgrading efforts. And importantly, LIVCD maintained a cost-sharing philosophy whereby prospective partners contributed at least 25 to 70 percent of the investments in question, often exceeding 50 percent.
LIVCD improved the lives of thousands of Lebanese by means of hundreds of activities that helped upgrade nine value chains, plus rural tourism. Decades of economic disruptions have stifled the growth of Lebanon’s rural value chains, but the nation’s abundant natural resources, ecological diversity, proximity to lucrative markets, rich cultural heritage, and educated workforce offer tremendous opportunity for rural economic growth. By investing in key value chains, the Lebanese agricultural sector and rural economy can meet expanding demand in domestic and export markets, and thereby create economic and social stability in rural areas.
LIVCD has certainly played a catalytic role in that process.
Nasser Lama was Chief of Party of LIVCD and Astrid Oksnevad was Project Manager.