Report on the oilseed growers cooperative project

Special evaluation covers the period 1/79-3/81 and is based on document review, site visits, and discussions with officials from USAID/I, the Cooperative League of the U.S.A. (CLUSA), and the National Dairy Development Board (NDDB), the implementor. The project -- representing the largest commitment of P.L. 480, Title II commodities in history ($160 million) -- is well-conceived, feasible, and necessary. Farmers receive 10% over the market price and thus reap significant income benefits. Also, 3% of project funds are allocated to research and development. Nonetheless, production enhancement activities have several flaws: field teams are few and poorly organized; farm laborers and sharecroppers are excluded from co-ops; credit and input supply systems have repeatedly broken down; improved seed is scarce; demonstration plots show poor experimental design and weak recordkeeping; price supports have risen due to high market prices; plans for farmer and extensionist training are lacking; only two of eight district farms have been established; linkages with agricultural research institutions are weak; and village and block storage facilities are inadequate. Surprisingly, CLUSA monitors have not recognized the seriousness of these problems. While acquisition of the Bhavnagar Vegetable Products plant was a wise move, additional and more sanitary processing equipment, especially for soybeans and other proteins, is needed to meet high domestic demand. In terms of marketing, the project does not contemplate using donated oil to build a buffer stock but rather plans to purchase soybean oil to resell, thus expanding marketing channels. This would be a safe and profitable venture. Because the relationship between USAID/I, CLUSA, and the NDDB leaves much to be desired, it is recommended that USAID/I demand and that CLUSA provide monthly reports and meetings on project progress; that CLUSA hire an agronomist to monitor progress; and that USAID/I take a more active role in project management.