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Turning Global Value Chains upside down: Lead firm practices to capitalize on the chemical fertilizer frontier in Africa

Authors: Gideon Hartmann*, University of Cologne, Peter Dannenberg, University of Cologne
Topics: Economic Geography, Food Systems, Africa
Keywords: GVC, bioeconomy, agriculture, Africa, Tanzania
Session Type: Paper
Presentation File: No File Uploaded

The ever-longer strand of literature on global value chains (GVC) tends to focalize a uni-directional, South-North linearity when addressing globalized agriculture. Here, predominant emphasis is put on GVC arrangements where Global South farming regions integrate as functional production base for Global North lead firms at the buying-end of GVCs. We think this notion is however limited, if not producing a fallacy in itself. Farming systems in the Global South are increasingly globalized not only via downstream food commodity transfers, but also through the use of agricultural inputs. Accordingly, global lead firms can just as well operate from the upstream side of GVCs and substantially govern how and for whom production and trade “work” in agriculture.
Acknowledging this, we turn GVC-thought upside down to follow the Norwegian fertilizer manufacturer YARA in rolling out its home-made Africa Strategy. Based on empirical work in Tanzania, we present how YARA introduced and governs its GVC to match a fragmented and marginal, but also competitive market. This roll-out was accompanied by far-reaching marketization practices in order to align Tanzanian territory to the lead firm’s needs. YARA has thus not only adapted its GVC strategy to local conditions, but invested heavily into shaping the regulatory regime, forging powerful alliances, and changing agricultural practices and preferences among (smallholder) farmers. Our work, therefore, illustrates how upstream lead firms capture markets and alter production and trade at the African input frontier. Finally, we will use this example to critically reflect on the conceptual implications of turning GVC-thought upside down.

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