Present status and prospects of value addition industry for agricultural produce – A review

1 Introduction

Globally, food production is continued to be lost and wasted. Annually, Food and Agriculture Organization (FAO) estimated about 14% of food losses before reaching the markets which is valued at $400 billion [1]. To meet the global food challenge, it is necessary to consider postharvest losses [2]. Achieving food security in any country is affected by many factors, most notably the loss of postharvest food, which annually leads to instability in the lives of millions of smallholder farm families. The world is also witnessing an increase in the population, which may reach 9.7 billion in 2050 [3], that creates great concerns in achieving food security and requires not only increasing agricultural production but also looking at other more effective and sustainable solutions that will maintain food production systems and reduce postharvest losses [2].

There are many reasons for postharvest food loss, most notably agricultural pests, mold, natural shrinkage like moisture loss, and climate [4]. The problems resulting from postharvest losses vary specifically with different crops, practices, climate, trade, and economics [5]. Therefore, one of the important ways to improve food security is to reduce losses [6]. Addressing postharvest losses may not require a massive investment, but it will lead to high returns if it is compared with increase in the field production to meet food demands [5]. To compensate the losses, minimizing postharvest losses of already produced food is required for more sustainability than increasing the production [7] which lead to contest the hunger and poverty, and raise the standard of living and food security [6].

In the past years, the world was looking at reducing agricultural poverty, especially in rural areas, by focusing on two important aspects: trade liberalization and expansion and increase in technology-based activities [8]. Agricultural techniques are one of the most promising means of reducing postharvest losses, which have proven successful in various fields. Some studies indicate that technology transfer and improved storage structure can play an important role in improving the production, reducing the postharvest losses, and increasing the farms’ income which can achieve the sustainability and food security [5].

The technology transfer is linked with the capacity building and knowledge development of the workers to contribute in postharvest loss reduction and thus increase the productivity. Capacity building is needed to enhance the use of postharvest agricultural techniques by traditional or modern methods and raise the awareness of farmers to contribute in production of value-added products from stored and surplus raw materials, increase the human consumption period, and preserve the products from pests and fungi [9].

One-third of total food production worldwide is disposed of as losses and waste, which are associated with about a quarter of agricultural land, water, and fertilizers used in crop production. Efforts to reduce food loss and waste have recently received significant attention for their contribution to enhancing food security and environmental sustainability [10]. Furthermore, demand for value-added agricultural produce is increasing due to income growth and increasing urbanization. Recently, there was plenty of attention towards increasing the availability of food and the expansion and diversification of agricultural products [10]. This can be achieved by adding value to agricultural products and minimizing the postharvest losses which play an important role in improving the viability, profitability, and sustainability of agricultural products [11]. Therefore, the purpose of this article is to study and review how the value-addition processes are applied to agricultural products and the institutional capacity building and technology transfer would improve food availability and sustainability.

2 Importance of value addition

Value addition is defined as an activity that agricultural producers may utilize to produce a new commodity by changing its present place, time, and from one set of characteristics to other characteristics that are more preferred in the marketplace to obtain higher returns [12]. Value addition is key to offsetting the poor positioning of any agricultural product in the market, building up the quality and branding, improving income, and increasing employment [13]. It is aimed to increase the year around availability and shelf-life of the commodity, improve off-farm employment opportunities, enhance the technology transfer and capacity building needs of the workers, increase the trade and economy of the country, and get a pathway out of the poverty [14,15].

The value addition is determined by calculating the difference between the raw product’s value, cost, and other inputs and comparing it with the returns of the value-added products [16]. It is important to determine the agricultural products that can be value-added which can support the market and enhance the income of the agricultural producers. In addition, there is a need to build up the technology and skills needed (technology transfer and capacity building) for product innovations [15].

On-farm value addition activity offers an alternative for diversification and rural development in the event of increasingly deregulated agricultural markets [17]. In response to the global progress in agricultural production, many farmers have turned to participate in the value-added activities of agricultural crops to ensure their survival in the intense competition in the global markets [12]. There are many examples worldwide as shown in Table 1 to study the successful outcome of the value addition process.

On the other hand, there are contrary reports from throughout the world on how the poorly handled postharvest systems result in an increase in postharvest losses and a decrease in farm net income. Table 2 shows the outcomes of various products (without value addition) in different countries that are affected by postharvest losses.

Value addition plays an important role in overcoming the postharvest losses [27]. It has significant implications on the farmers, suppliers, processors, distributors, and retailers who target to improve the growth rates, the market share, the customer satisfaction, and the sustainability issues in the business plans [28].

3 Importance of technology transfer and capacity building for value addition

Technology transfer refers to transferring scientific methods of production from one enterprise, institution, or country to another among more people and places [29]. It involves linking research and small-scale producers and marketers. Inadequate technological knowledge and lack of awareness about value addition are the main constraints faced by the farming community.

In agriculture, technology transfer is defined as the quick transfer of technology from the circuits of knowledge to the producers like industry and users like farmers [30].

The aim of technology transfer to the producer or user is to enhance production and reduce the institutional gaps, barriers, and mismatching between them [31]. Reliance on modern technology in agriculture is important for production improvement, providing welfare to farmers, poverty reduction, food security, and rural development [32,33,34]. Improvement in agricultural production can be accelerated if new transfer technologies are used [35].

Short-term technology transfers: some agricultural techniques need to be available for every production period like seeds, pesticides, fertilizers, packaging, and storage because they are repeated and the benefits are assessed every year [36]. Long-term technology transfers: techniques need to be produced after short-term techniques such as training farmers and workers in general, tools used in agriculture, tracking systems, and others. Short-term technologies are easier to transfer than the long-term technologies [36]. Technology transfer is linked with agricultural sustainability because the aim is to use these technologies to buildup the agro-ecosystems and farm-households which help to enhance their performance [37].

The technological requirement for farm levels have shifted dramatically from traditional ones to those of technologies like value addition of the agricultural products. The need of technology transfers for value addition is increased in farm levels to contribute in improving the production of agricultural products and decreasing the land use which can also contribute to other processes of agricultural products such as sorting, packaging, branding, storing, etc. [38]. Table 3 shows how technology transfer enhances the production of different agricultural products in different countries.

4 Current status of agricultural industry in Oman

Agriculture in Omani history has represented the first source of livelihood. It is considered one of the most important productive sectors in which the contribution to the GDP reached up to 224.1 million OMR in 2014 that grew about 3.2% per year from 2011 to 2014 [49]. The strength, weaknesses, opportunities, and threats (SWOT) of agriculture in Oman are determined [50] by 2040 vision in Table 5.

Table 6 shows that dates, tomato, cucumber, and melons are the most cultivated crops in the sultanate and their production increased from 2013 to 2019. This could be an indication that the demand for vegetables and fruits will be increasing in the future in the Sultanate. As Oman is an arid region located in the eastern part of the Arabian Peninsula, where temperatures can exceed 50°C in the summer, unfavorable environmental conditions result in high postharvest food losses. Al-Lawati reported that average postharvest losses after harvesting time and during marketing were 28 and 30% for fruits and vegetables, respectively [52].

5 Potentials of value addition industry in Oman

It is apparent that there is an increase in agricultural production in 2019 as compared to previous years and the date palm occupies first in both area and production. Oman is the eighth highest date producing country in the world with more than seven million trees and over 200 varieties [51,54]. Table 8 shows the potential of date that may reach a sustainable level [53,55].

6 Conclusions

• Nowadays, there is an interest in reducing postharvest losses and finding solutions to increase the income of many farms, combat hunger and poverty, and raise the standard of living and food security.

• It can be done by using both technology transfer and capacity building that help introduce the value addition concept of agricultural products to increase the production, create a new product, and improve the postharvest treatments that contribute to agricultural sustainability.

• Value-addition aims to increase the availability of the commodity, provide off-farm employment opportunities, enhance capacity building, increase trade, and get a pathway out of poverty.

• In Oman, agriculture faced many weaknesses and challenges in postharvest, value addition, and marketing because of poor technology transfer and capacity building of laborers where most of them are unskilled.

• Oman has many cultivated crops that reach a sustainable level, like dates, bananas, tomatoes, cucumber, etc.

• On the other hand, many postharvest losses happened after the harvesting time and during marketing.

• Adding value to agricultural products can enhance the quality and quantity of the final product and improve packaging and branding.

• Adding value is the key to improving the income of many farms in Oman and making the country well-known among different global markets, which will consequently positively impact the country’s economy and GDP.

• Many of these developments related to value addition, technology transfer, or capacity building aiming at food security and sustainability have been expected to be implemented in Oman’s 20-year holistic development plan of Oman Vision 2040 [60].