TECHNICAL AND VOCATIONAL TRAINING INSTITUTE

FACULTY OF CIVIL TECHNOLOGY

DEPARTMENT OF WOOD TECHNOLOGY MANAGEMENT

Investigating the value chain analysis of Eucalyptus globulus pole in Addis

Ababa.

Proposal for the Partial Fulfillment for the Requirement of the Degree of Masters in Wood
Technology Management

BY：CHALA ABEYA

Advisor: Dr. Yashwant Singh Rawat

2023

Addis Ababa

Approval Sheet:

Chala Abeya __________________ _____________

Name of student Signature Date
Approved by
Dr. Yashwant Singh Rawat __________________ _____________
Name of Major Advisor Signature Date

Mr. _________________ __________________ _____________

Name of Co-supervisor Signature Date

_____________________ __________________ _____________

Coordinator Signature Date
Graduate program

_________________ __________________ _____________

Chairman, Dept. Signature Date
Graduate program

Acknowledgement

Words cannot express my gratitude to my graduate research advisor, Dr. Yashwant Singh
Rawat, for his invaluable patience and feedback throughout the development of the research
proposal. In addition to guidance in proposal writing, his advice and inventive comments in the
structuring and re-structuring of the proposal writing has been extremely helpful.
I am also grateful to each sub cities for their willingness and give the total population (number
of Eucalyptus globulus pole stake holders) for this study.
LISTOF FIGURES
Figure 1 . Basic steps of a typical value chain(Source:Munuyee( 2018:p.14))...............................20
Figure 2 Conceptual framework of the description of the eucalyptus pole value chain(SOURCE:
Nacke (2018: P.11))............................................................................................................................... 20
Figure 3 Map of Addis Ababa. Source:Wikipedia............................................................................. 22

LIST OF TABLES
Table 1 schedule.................................................................................................................................... 25
Table 2 budget........................................................................................................................................ 26

Glossary

ETB: – Ethiopian Birr

VC: –value chain

ha:– hectare
 cm:- centimeter

Abstract

The contribution of Eucalyptus globulus pole for construction sector in Addis Ababa is too
considerable. Eucalyptus globulus pole contribute significantly to the income of smallholder
growers in Addis Ababa. Smallholders are mainly motivated to plant and convert their
productive farm plots into Eucalyptus due to the growing demand for Eucalyptus wood products
as well as the associated increase in the price of its products (mainly poles).
Now days, in Addis Ababa due to fast population growth, there is immediate need for
construction of various types. Construction house consumes large amount of Eucalyptus tree
products. Scaffolding on construction sites, or the building materials for simple homes, and the
prevalence and importance of Eucalyptus in Addis Ababa becomes quickly indication. The
demand of scaffolding systems for the construction of the new high-rise buildings in Addis Ababa
is very high. Use of Eucalyptus globulus poles for scaffolding, is increasingly observable in
Addis Ababa. It is also used for fencing, construction of traditional and modern houses.
Eucalyptus globulus pole is the widely abundant species, main cash generating and livelihood
supporting investment in Addis Ababa. The objective of the study is to investigate the value chain
of Eucalyptus globulus poles in Addis Ababa. Eucalyptus globulus pole and their lines, chain
actors, their function and interaction, estimate cost and value-added distribution, identify the
role of Eucalyptus pole for actor’s livelihood strategy, mechanisms and structure of access to
benefit, explore supporting and enabling environments along the value chain and finally to
identify options for upgrading the value chain.
Structured, semi-structured, and unstructured questionnaires, as well as focus groups, field
observations, and market evaluations, will be used to collect primary data to conduct the study.
Graphs, tables, and descriptive paragraphs will be utilized to summarize and assess the data in
Excel and Microsoft Word. To analyze the economic efficiency of actors in various segments
throughout the VC, the revenue, various costs, gross margin, and profit margin will be
computed. The VC, chain actors and their characteristics, function and interrelationships, credit
access, the Eucalyptus globulus product and marketing line, the role of Eucalyptus globulus
pole for actor livelihood strategy, actor coordination and power distributions, challenges and
constraints, and finally, options for upgrading the VC through the use of Eucalyptus globulus
poles will be all looked into.
Keywords: Eucalyptus globulus, VC, Chefeka, Worage, Mager, Atana
CHAPTER ONE
INTRODUCTION

Background of the study

The growing demand offer wood for construction and fuel on the demand side and its high
adaptive capacity in a wide range of soil types on the supply side together with the
aforementioned reasons have fostered the rapid expansion of Eucalyptus (Amare et al., 2021).

In Ethiopia, Eucalyptus was first introduced in 1895 with the objectives of meeting the steadily
increasing demand for construction poles and fuelwood in Addis Ababa (Gil et al. 2010,
Munuyee, 2018). According to Munuyee (2018) Eucalyptus plantations have expanded greatly
throughout Africa and particularly in Ethiopia, because of its both very high yield and its ability
to adapt to a long range of environmental conditions.

Currently, Eucalyptus is the most utilized tree species in Ethiopia. It is one of the most
commonly planted tree species for construction and wood fuel (Bekele et al. 2013, Munuyee,
2018). Eucalyptus is the most single dominant plantation species in the country widely used
contributing to the national consumption of construction poles (92%), timber (74%), fuelwood
(85%), charcoal (40%), posts (83%) and farm implements wood sources (91%)(Dessie et al.,
2019).

Eucalyptus globulus dominates the Ethiopian afforestation and reforestation programs connected
with ever increasing demand for construction, fuel wood and industrial wood production
purposes (Bekele, 2015). As Bekele (2015) states that E.globulus is preferred by the
communities of the highlanders since it is fast growing and meets the needs of construction and
fuel wood users. In Ethiopia Eucalyptus wood is widely used for construction of shoring and
scaffolding. Eucalyptus wood can be constructed in different shapes and sizes to support
formwork for in-situ concrete construction or to provide temporary access and working platforms
in elevated areas (Kelemework, 2017). Eucalyptus globulus is well suited for structural work,
light and heavy construction work, light and heavy flooring, boxes and crates for fruits and
vegetables. It is also widely used for building, fencing, electricity transmission, telegraph poles
and posts (Desalegn and Gezahegn, 2010).

According to (Lemenih and Kassa 2014; Barbiche and Alemu 2016; MEFCC 2017, Nacke,
2021), construction poles are also used for the construction of traditional and modern houses as
well as for scaffolding in Ethiopia. A widely used informal classification system for construction
poles exists throughout Ethiopia with local variations in terminology, but are all similarly based
on diameter, straightness, and length (Barbiche and Alemu 2016; Tsedalu 2017; Munuyee 2018,
Nacke, 2021). The demand for Eucalyptus poles is due to national and export markets. National
markets are in the growing cities of the country where demand is driven by population and
economic growth (Lemenih and Kassa 2014, Nacke, 2021).

Nowadays, in Addis Ababa due to fast population growth, there is immediate need for
construction of various types. Construction house consumes large amount of eucalyptus tree
products. Scaffolding on construction sites, or the building materials for simple homes, and the
prevalence and importance of Eucalyptus in Addis Ababa becomes quickly indication. The
demand of scaffolding systems for the construction of the new high-rise buildings in Addis
Ababa is very high (Kelemework, 2017). Use of Eucalyptus globulus poles for scaffolding, is
increasingly observable in Addis Ababa. It is also used for fencing, construction of traditional
and modern houses.

Eucalyptus not only grows quickly it also grows straight with few large branches. This makes it
ideal for timber for homes and for the ever-present scaffolding around the city with so much
construction happening. Kidanu (2004), states that due to lack of enough indigenous trees in
smallholder farmers’ possession and their costly nature, the need for Eucalyptus poles became
the only accessible raw materials. Eucalyptus poles cost lesser amounts of currency than the
others. It is also available at farmers’ woodlots or the nearby villages and markets.

Eucalyptus globulus pole is the widely abundant species, main cash generating and livelihood
supporting investment in Addis Ababa. This requires ensuring sustainable product markets to
growers and other actors to increase their competitiveness in the business. In order to empower
smallholder growers and other actors and to improve their performance and commercialize the
sector, it is important to examine the nature of the Eucalyptus globulus pole value chain by
examining the entire series of activities that are needed to bring a product from production to the
ultimate consumers.

Value chain is a concept and a framework for organizing and analyzing information on how
inputs and services are brought together and then used to grow, transform, or manufacture a
product and then how the product moves from the producer to the consumer as well as how value
is increased along the way (Munuyee, 2018).

Improving the production of Eucalyptus plantation and the value of its products such as pole and
fuelwood helps to sustain the rural households with food security, reduces poverty and adapt the
changing climate (Munuyee, 2018). The Eucalyptus value chain from production to market has
been broken down into the functional stages “input-supply”, “production”, “processing”;
“trading” and “consumption” (Tsedalu 2017; Munuyee 2018, Nacke, 2021).

The first stage “input supply” includes the provision of seedlings and farm equipment, the second
stage is identified as “production” and includes the activities regarding the site preparation,
planting, and woodlot maintenance which are done by the smallholders with the option to hire
additional labor to complete the tasks (Tsedalu 2017; Munuyee 2018, Nacke, 2021). A third
stage “processing” is put forward by (Munuyee 2018, Nacke, 2021) for the activities of
harvesting, de-branching, storing, loading, and unloading of poles, which are done by hired
laborers and transport service providers. The fourth stage “trading” is the domain of traders
buying timber from smallholders and selling it to other traders (Nacke, 2021).

Statement of the problem

In Addis Ababa, Eucalyptus globulus pole has been playing a significant role in construction
sectors (scaffolding), fencing, construction of traditional and modern houses and the majority of
the scaffolding meet their wood demand from it.

According to Kelemework (2017) the demand of scaffolding systems for the construction of the
new high-rise buildings in Addis Ababa is very high. Scaffolding is usually constructed using
Eucalyptus pole. Thus, attention to adding value to the Eucalyptus globulus pole should have a
great role to enhance the value of Eucalyptus globulus and improve the livelihood of the farmers
and construction workers. Even though different value chain of Eucalyptus studies (Amare et
al., 2021, Munuyee 2018, Nacke, 2021, Dessie, et al. 2019) have been carried out in different
regions of the country, studies that deal with the value chain analysis of Eucalyptus globulus pole
in Addis Ababa is not done.

In this regard, the value chain of Eucalyptus globulus pole in Addis Ababa can be an important
input for policies, decision-makers, farmers and practitioners. This study will investigate the
Eucalyptus globulus pole value chain in terms of the actors engaged, the type and importance of
channels, margins analysis in and the overall value chain governance in the main Eucalyptus
globulus pole consuming areas of Addis Ababa.

Objective of the Study

General objective

The main objective of the study is to investigate the value chain of Eucalyptus globulus pole
from producer to the end users in Addis Ababa.

Specific objectives

To map the product flow of Eucalyptus globulus pole used in construction sector from its
production to end user in Addis Ababa.

2. To characterize Eucalyptus pole actor’s interactions, functions and linkages in the value chains

Research questions:

How do value chain actors involved, interact and what are their functions in the chain?

What are the products of Eucalyptus globulus pole and how is the product line from producer to
consumer?

What are the main activities carried out in the value chain of Eucalyptus globulus pole?

Who are the main actors in the Eucalyptus globulus pole value chain?
Scope of the study

The research will focuses on value chain analysis of Eucalyptus globulus pole mainly for
scaffolding systems used in building construction projects in Addis Ababa.

The research will also focuses on the uses of pole for posts and house construction which are
built from the Eucalyptus tree in the study areas.

Significant of the study

Eucalyptus globulus pole is the widely used raw material for scaffolding, fencing, posts, and
construction of traditional and modern houses. This requires ensuring sustainable product
markets to growers and other actors to increase their competitiveness in the business. This study
will empower smallholder growers and other actors and improve their performance and
commercialize the sector, by investigating the value chain that is needed to bring Eucalyptus
pole from production to the ultimate consumers.

CHAPTER TWO
RELATED LITERATURE REVIEW

Eucalyptus plantation in Ethiopia

In Ethiopia, Eucalyptus is one of the most exotic tree species which introduced by Emperor
Menelik II in 1895 in order to alleviate the shortage of firewood and construction wood in the
capital city of Ethiopia. Currently, Eucalyptus is growing and expanding almost in all part of
Ethiopia for satisfying the growing demand of forest product. Eucalyptus is a long and ever
green tree which belongs to the family of flowering plants known as Myrtaceae (Dessie, 2019).
Among the various types of Eucalyptus species Eucalyptus globulus is dominantly one of the
wide spreading species across the high lands of Ethiopia (Lemeneh and Kassa, 2014). Currently,
the estimated area of land coverage of Eucalyptus tree plantation in Ethiopia accounts over
500,000 ha (Abebe and Tadesse, 2014). The wide spread of Eucalyptus tree plantation has also
contributed to increasing the species plantations cover from an estimated 190,000 ha in 1990 to
972,000 ha in 2010(Bekele, 2011).

Historical development of Eucalyptus globulus in Ethiopia

Eucalyptus globulus was one of the first Eucalyptus species introduced to Ethiopia and is
currently the most popular, and is now perceived as ‘indigenous’ among local communities.
Community woodlots and plantations are managed by groups of farmers. The total area of
plantations of E. globulus exceeds 100, 000 ha (Hunde et al., 2006). Commencing in 1895,
plantations were established to supply poles and fuelwood to the city of Addis Ababa and other
major towns in the Central Highlands (Davidson 1995, Hunde et al., 2006).

Notwithstanding an ongoing public argument for and against the use of Eucalyptus as plantation
species, E. globulus plantations are attractive from an economic viewpoint (Pohjonen and
Pukkala 1988, Hunde et al., 2006). Although, the first introductions of E. globulus to Ethiopia
were successful, the provenance origins and genetic base of the introductions are unknown and
probably sub-optimal, and there could be a high degree of inbreeding in the land races that have
developed (Ethiopian Forestry Action Plan 1994; Davidson 1995, Hunde et al., 2006).

It was planted on the hills of the central highlands of the country and it has become one of the
most extensively planted tree species in Ethiopia. Its rapid growth and adaptability to a range of
conditions has made it preferable than any other exotic species grown in the country. Eucalyptus
globulus dominates the Ethiopian afforestation and reforestation programs connected with ever
increasing demand for construction, fuel wood and industrial wood production purposes (Bekele,
2015).

About 72 species of Eucalyptus are available in Ethiopia, most of which are widely spread in
many regions of the country, mainly in central highlands where higher population density. The
most common and widespread Eucalyptus species include: Eucalyptus globulus Labill.,
Eucalyptus camaldulensis Dehnn., Eucalyptus saligna Sm., Eucalyptus grandis W.Hill ex Maid.
and Eucalyptus tereticornis Sm. Planting Eucalyptus has been expanding from state owned
forestry enterprises and projects to community woodlots, household and farm field boundaries
(Friis, 1995; Zewdie, 2008,Bekele, 2015).

E.globulus is preferred by the communities of the highlanders since it is fast growing and meets
the needs of construction and fuel wood users. Moreover, the species is well suited to the
existing ecological, economic and social conditions of the country (Bekele, 2015). Since the
Ethiopian highlands are suffering from severe deforestation and biomass fuel crises, E.globulus
is the prominent tree in government and community estate plantations because of its fast growing
ability through coppicing, resistance to browsing by livestock, and through simple sawing and
potted seedling propagation (Zewdie, 2008, Bekele, 2015).

Eucalyptus growers, livelihoods and sustainable forest management

Small holders benefit from tree planting by producing timber and non-timber forest products for
household consumption as well as for sale and both subsistence. From the outset that any cash
generation activity of the households from sales of farm products is part of subsistence livelihood
strategy rather than pursuing of market oriented economy. Eucalyptus poles are highly regarded
among certain households as an important source of cash income. It is often viewed as a living
bank account that can be liquidated upon emergencies (Zerga and Woldetsadik, 2016).

Tree plantation at household level considerably reduces the time household member mostly
women and children travel to collect fuel wood for their household use (Tenaw, 2007, Zerga and
Woldetsadik, 2016).

Due to lack of enough indigenous trees in smallholder farmers’ possession and their costly
nature, the need for Eucalyptus poles and logs became the only accessible raw materials. A
eucalyptus product is also available at farmers’ woodlots or the nearby villages and markets.

Soil and water conservation

Eucalyptus tree converts energy and available water into biomass efficiently (pohjonen and
pukkala 1990, kidanu 2004). E.globulus trees, unpalatable to cattle, sheep and goats, have
distinct advantage as boundary plating in the Ethiopian highlands where the protection of
privately planted trees on the farm land is difficult because of dry season free grazing practices
(kidanu 2004). By providing substitutes for indigenous forest products Eucalyptus boundary
planting could help to preserve indigenous woodland and biodiversity.

Eucalyptus pole value chains in Ethiopia

Numerous studies have been conducted on Eucalyptus growing by smallholders in Ethiopia but
studies focusing on the Eucalyptus pole value chain are rare(Nacke, 2021).Currently, Ethiopia
holds the largest portions of Eucalyptus plantation in East Africa. Smallholder farmers in
Ethiopia grow Eucalyptus mainly for fuelwood, charcoal, construction wood, poles and furniture
making (Munuyee, 2018).

In Ethiopia, construction poles are used for the construction of traditional and modern houses as
well as for scaffolding (Lemenih and Kassa 2014; Barbiche and Alemu 2016; MEFCC 2017,
Nacke, 2021). A widely used informal classification system for construction poles exists
throughout Ethiopia with local variations in terminology, but are all similarly based on diameter,
straightness, and length (Barbiche and Alemu 2016; Tsedalu 2017; Munuyee 2018, Nacke,
2021).

According to Amare et al. (2021), Eucalyptus pole for construction purposes that include roofing
wood, construction poles, rod/atana and wood for structural frameworks and supports. Amare et
al. (2021), also mention that around Blue Nile high lands of Ethiopia construction wood retailers
are special actors who handle a large volume of Eucalyptus wood transacted in 2020/2021. The
total volume of construction (roofing wood, walling wood and rod/atana) handled by these actors
were estimated at 314,514 m3 and 301, 2017.20 m3, respectively. The majority of the wood
transacted by these actors was consumed by the construction sector. Product destinations include
construction sites (large building structural supports and frameworks, roofing frameworks).

Roofing wood is the most expensive of all wood product and these products are highly preferred
for their straightness and fitness to the proposed construction purpose, usually for commonly
made non-concrete houses (Amare et al., 2021). Peeling/debarking is one of the most important
value addition activities carried out by construction wood retailers. Peeling is usually performed
immediately after felling the trees as it takes much labor to peel as the wood becomes drier.
Poles dried without peeling have significantly lower prices than peeled ones (Amare et al.,
2021).

The Eucalyptus value chain from production to market has been broken down into the functional
stages “input-supply”, “production”, “processing”; “trading” and “consumption” (Tsedalu 2017;
Munuyee 2018, Nacke, 2021). The first stage “input supply” includes the provision of seedlings
and farm equipment (Tsedalu 2017; Munuyee 2018, Nacke, 2021). Seedlings are provided by
NGOs, government organizations, development projects, as well as sold by private nurseries or
produced by the tree growers themselves (Tsedalu 2017; Munuyee 2018, Nacke, 2021).
The second stage is identified as “production” and includes the activities regarding the site
preparation, planting, and woodlot maintenance which are done by the smallholders with the
option to hire additional labor to complete the tasks (Tsedalu 2017; Munuyee 2018, Nacke,
2021). A third stage “processing” is put forward by Munuyee (2018) for the activities of
harvesting, debranching, storing, loading, and unloading of poles, which are done by hired
laborers and transport service providers. (Tsedalu 2017, Nacke, 2021) came to a similar result
but points out that farmers engage in the “processing” stage if they do selective harvesting,
which appears to be a smaller case.

The fourth stage “trading” is the domain of traders buying timber from smallholders and selling
it to other traders. The activities performed at this stage are transporting, sorting, and selling to
other traders or final customers (Tsedalu 2017, Nacke, 2021). The poles went through the four
functional stages of woodlot management, harvest, pole preparation, and trade and transport.
Traders were the main actors in charge of the stages of harvest, pole preparation, and the final
trade and transport of the poles to the specific final market (Nacke, 202). According to Nacke
(2021) the construction poles are subdivided into 6 categories based on their diameter.

Crooked or damaged poles are used for fuelwood or charcoal production. This categorization of
construction poles is not formalized and offers rough guidance for the actors. The categorization
is done by visually estimating diameter and quality at any stage of the chain. It is functional but
comes with its uncertainties. Nacke (2021) also mention that the length of a construction pole
varies considerably.

For long transport distances, whole poles are cut to 5.5 or 6.5 m in length to maximize the
amounts which are transported on trucks with trailers. In traditional way of building a house use
the small diameter poles with the estimated diameter of 10 -15cm and 3 m length stands as a
frame and also used for large buildings scaffoldings and structural parts.

Actors involved in the Eucalyptus pole value chain

Tree growers: Tree growers are those households or farmers who are involving in Eucalyptus
production activities. The main input suppliers in the chain are Eucalyptus globulus growers. A
large-scale Eucalyptus globulus farming exists in several forms, including government,
community, and private plantations.
Labourers: Munuyee, (2018) identifies labourers are a critical component in most of the stages
of the value chain of Eucalyptus pole production and marketing. Most of the works of
Eucalyptus production and processing are done manually. The function of the labourer in the
Eucalyptus pole production and marketing includes planting, weeding and hoeing, harvesting of
Eucalyptus, removal and separation of branches and twigs. Besides, transporting to the roadsides
or stacking in one area, loading and unloading, assorting different heterogeneous class of poles
based on the size, length, quality and function of the pole among others.

Construction Wood Retailers

According to Amare et al. (2021) construction wood retailers are special actors who handle a
large volume of Eucalyptus wood. The product they handle is for construction purposes that
include roofing wood, construction poles, rod/atana and wood for structural frameworks and
supports. The majority of the wood transacted by these actors was consumed by the construction
sector. Product destinations include construction sites (large building structural supports and
frameworks, roofing frameworks).

Consumers:

According to Munuyee (2018) the big Eucalyptus pole consumers are urban consumers including
constructors (modern and traditional house constructors), carpenters and service providers.
Modern house constructors used Eucalyptus pole mainly for house construction and scaffolding
purposes. Consumers can get their products directly from tree growers or buy them at the stand.

Construction and Eucalyptus Pole

Kelemework (2017) identifies that, in Ethiopia Eucalyptus wood is widely used for construction
of shoring and scaffoldings. Scaffolds are commonly used in construction work to have a safe
and stable work platform when work cannot be done at ground level or on a finished floor.
Scaffolding's are used to support light to moderate loads of labors, small construction material
and equipment for safe working space. Eucalyptus wood can be constructed in different shapes
and sizes to support form-work for in-situ concrete construction or to provide temporary access
and working platforms in elevated areas.
Dessie (2019) also identifies that; construction wood is classified locally into Worage and Mager
depending on the diameter of the round woods used for construction purposes. Worage is mainly
used for house construction, particularly at roof parts of house and its diameter and length ranges
from 10-12 cm to 8-10 m, respectively. While Mager is also used for house construction in
horizontal position and its diameter and length ranges from 8-10 cm to 6-8 m, respectively. Split
wood is the other most important types of product, which mainly used for house construction at
vertical positions in all rounds and its length ranges 4-6 m.

Eucalyptus pole for scaffolding

Eucalyptus is the most common material used in construction of scaffoldings in building

construction industry around Addis Ababa. 4.10 of the 38 building projects 22(57.9%) of them
were using Eucalyptus wood. Even though size and the spacing of the Eucalyptus vary from
place to place most of these projects follow similar method of construction. For construction of
posts Eucalyptus wood with diameter from 10cm and 12 cm diameter which were placed in
every 60cm to 100 cm in transversal direction and 60 cm to 180 cm in the longitudinal direction
along the perimeter of the building were being used (Kelemework, 2017).

According to Kelemework (2017) the spacing and the size the Eucalyptus wood used in the
construction of posts were dependent on the height of the scaffolding system to be constructed. If
the height is considered to be significant enough for raising the question of stability of the system
stronger Eucalyptus wood which have greater or equal to 12 m diameter will be used throughout
the height of the building or on the base (foot) of the scaffolding system, if not 10 cm diameter
Eucalyptus wood is used. The problem with their approach is there is no standard or code of
practice which could verify the maximum height limit of a building which will raise such kind of
question which makes it subjected to the experience and judgment of the carpenter who construct
the scaffolding system.

Kelemework (2017) also identifies that 10 cm or 8 cm thick Eucalyptus which were spaced form
180 cm to 190 cm along the height of the building for construction of ledgers and transoms 8 cm
diameter Eucalyptus wood or 4 cm- 6 cm diameter Eucalyptus wood also called “Chefeka” in
Amharic word for very thin eucalyptus wood, were being used commonly. To ensure the stability
of the structure diagonal cross bracing using 8 cm diameter Eucalyptus wood were constructed in
some of the projects. For connecting and bracing each scaffolding elements with each other # 8
to #12 size nails were being used. The choice of the nails depends on the thickness of Eucalyptus
wood used. Posts will be restrained to the slab or beam in each floor using 2.5 black wires to
make it stable form wind loads or movement of the whole scaffolding system. For stair cases,
ladders and working platform commonly wasted eucalyptus wood or “Chefeka”, an Amharic
word for very thin eucalyptus wood, were being used.

Eucalyptus for construction of traditional houses in Ethiopia

Eucalyptus was introduced to Ethiopia in the 1890s, and now has become integral to the
construction practices in the country. Because it is a fast growing wood, it can be used as a
quickly replenish-able building material. The Eucalyptus-structured buildings grew out of an
older tradition of dung building in Ethiopia. The traditional way to construct a residential
building in Ethiopia is to use a frame of wood in the walls. Wooden posts with a proper length
are put into the ground. The wood mainly used is, at least in the highlands, fast growing
Eucalyptus (Hjo and Widén, 2015).

Eucalyptus pole for roof construction in Ethiopia

In Ethiopia, it is conventional to use eucalyptus logs for trusses of a roof. The roofing wood
materials (Maagara, Laaxaa and Axanaa) are composed of E. globulus, E. camaldulensis and C.
lusitanica. For roof, lighter but stronger wood like E. camaldulensis, E. globulus, and C.
lusitanica are preferred (Duguma and Hager, 2010). Eucalyptus is fairly durable and less costly.
Farmers usually grow Eucalyptuses on their extra farmlands and cut them down within several
years to sell them at the nearby market. Eucalyptus is a cash crop in Ethiopia. Thus, its usage is
not related to any destructive forestry policy.

Socio-economic and socio-cultural merit of Eucalyptus globulus to household livelihood in

Ethiopia
Eucalyptus has various socioeconomic uses such as employment, security and financial benefit,
not only in the rural production systems but also for the urban energy (charcoal) and construction
(scaffolding) sector. It also played a significant role in improving the livelihoods of rural
communities, poverty reduction and reducing the pressure from remnant native forests especially
in the highlands of the country (Tadele etal. 2014; Daba 2016, Munuyee, 2018).

Eucalyptus globulus is used for a wide range of household uses. Farmers stated (Bekele 2015)
some of the major benefits for households: construction of houses, household utensils, cooking,
heating, and handles of farm implements. The income generated from Eucalyptus is by far higher
than the income generated from cereal crops, although many people felt that the livelihood of the
farmers’ totally depends on agricultural activities accounting for the largest proportion of land
for agricultural activities (Bekele, 2015). There is also a growing market in terms of wood
product utilization from Eucalyptus. It is extensively used as poles for power and
telecommunication lines. It is also abundantly used in structural work as scaffold and for making
crates for fruits etc. Because of that, there is an increasing trend to establish Eucalyptus
plantation in recent decades (Mesfin Abebe and Wubalem Tadesse, 2006).

Eucalyptus globulus is recognized as being the most important exotic tree species at the
community level. The main fundamental characteristics of E.globulus are: fast-growth, yield
high biomass, suitable for building materials and firewood, coppicing ability, and short rotation
compared to the other indigenous and exotic tree species (Edesa, 2021).

Theoretical Framework

The concept of value chain

The concept of “value chain” was introduced by Porter (1985) to describe the full range of
activities, which are required to bring a product or service from conception, through the
different phases of production, distribution to consumers, and final disposal after use.

Value chain analysis is originated from the discussion of two distinct traditions, namely the
French ‘filière concept’ and Wallerstein’s concept of a commodity chain (Faße et al.
2009,Munuyee 2018). The filière approach emerged in France in the 1960s to address industrial
economic problems with the main emphasis on the economies of scale, transaction cost, and
input-output relationships (Raikes et al. 2000, Munuyee 2018). The structure of the value chain
network has two dimensions; the vertical and horizontal dimension. The vertical dimension of
value chain refers to the flow of products from the initial producer up to the last consumer, while
the horizontal dimension reflects the relationship between stakeholders in the same chain link
such as farmer to farmer (Kaplinsky and Morris 2001; Trienekens 2011; Islam 2014,Munuyee
2018). The shape of the vertical relationship may follow many stages or may not, while
horizontal relationships have various shapes between the stakeholders such as farmer
cooperatives or price agreements between wholesalers. Therefore, the value chain network
structure is the principle dynamics of all sectors of the economy.

Value chain is an effective approach in tracing the product flows, showing the value-adding
stages, identifying key actors in the chain and the entire power relationship and linkage between
the actors, assessing market dynamics and governance issues (Kaplinsky and Morris 2001;
Schure et al. 2014, Munuyee 2018). A typical value chain follows the basic steps outlined in
figure 1. The steps include production, processing, transport and trade, distribution and retail,
and consumption.

Figure . Basic steps of a typical value chain (Source:Munuyee( 2018:p.14)).

The Simple Value Chain

The value chain describes the full range of activities which are required to bring a product or
service from conception, through the different phases of production involving a combination of
physical transformation and the input of various producer services, delivery to final consumers,
and final disposal after use. Moreover, there is range of activities within each link of the chain.

Although often depicted as a vertical chain, intra-chain linkages are most often of a two-way
nature – for example, specialised design agencies not only influence the nature of the production
process and marketing, but are in turn influenced by the constraints in these downstream links in
the chain. The most important implication of applying the value chain approach is the fact that
all decisions made at one step in the process have consequences for the following steps, and
often such decisions may be irreversible.
simple value chain (Source:Vodafone Group et al., ( 2016:p.88)).

The extended value chain

In the real world value chains are much more complex. There tend to be many more links in the
chain. The value chain does not only include a straight line. There are external activities that
influence activities within the value chain. For the sake of simplicity, these external parts of the
value chain may be called upstream activities and downstream activities. Upstream activities
provide inputs into the industry, while downstream activities relate to the outputs from the
industry (Vodafone Group et al., 2016).

extended value chain (Source:Vodafone Group et al., ( 2016:p.89)).

primary activities in the value chain

Porter breaks value chain analysis into five primary activities.

Inbound Logistics

Inbound logistics include the receiving, warehousing, and inventory control of a company's raw
materials. This also covers all relationships with suppliers.
Operations

Operations include procedures for converting raw materials into a finished product or service.
This includes changing all inputs to ready them as outputs.

Outbound Logistics

All activities to distribute a final product to a consumer are considered outbound logistics. This
includes delivery of the product but also includes storage and distribution systems and can be
external or internal.

Marketing and Sales

Strategies to enhance visibility and target appropriate customers such as advertising, promotion,
and pricing are included in marketing and sales. Basically, these is all activities that help
convince a consumer to purchase a company’s product or service.

Services

This includes activities to maintain products and enhance consumer experience customer service,
maintenance, repair, refund, and exchange.

Value chain analysis (VCA)

A Value chain Analysis is an alliance of enterprises collaborating vertical to achieve a more

rewarding position in the market (Kumar & Rajeev P. , 2016). Value chain analysis has been
employed to examine and evaluate entire industries and industry clusters, as well as specific systems
within firms. The VC of Eucalyptus globulus poles can be divided into several categories of
activities.

VCA includes mapping of the VC, description of the main actors participating in the VC and
finally analysis of how the value is transferred throughout the chain of different actors. The
methodology of VCA includes gathering data, documentary review of literature, primary
information from the field through structure and semi-structure interviews, marketing
assessment, field observations using snowball and purposive sampling survey, and also collect
data summarized and analyses to generate gross margin obtained by different actors in the chain.

Value chain includes producers, inputs suppliers, operation, processors, retailers and buyers. The
value chain mainly focuses on the market collaborating strategy, where it emphasized the
linkages between production, marketing etc. activities of the products and services in an effective
and efficient manner (Kumar & Rajeev P. , 2016).

major activities in the value chain

upstream activities and down stream activities

The upstream supply chain includes all activities related to the organization’s suppliers: those
parties that source raw material inputs to send to the manufacturer. The downstream supply chain
refers to activities post-manufacturing, namely distributing the product to the final customer.
Downstream supply chain can also be thought of as the “demand” while upstream supply chain
is the supply (Britt, 2021).

Descriptive framework for the Eucalyptus pole value chain

This study takes the value chain view defined by Kaplinsky and Morris (2002) as its main frame
of references and analysis. Thus, the description of the Eucalyptus pole value chain focuses on
the three themes: (1) Eucalyptus pole products and markets; (2) the actors at the input-output
structure, and (3) their transactions. This study focuses on Eucalyptus pole products and markets
from smallholder woodlots. At the input-output structure, products advance from one functional
stage to another (Kaplinsky and Morris 2002). The Eucalyptus pole value chain in Ethiopia is
expected to consist of 5 stages: input supply, production, processing; trading, and consumption
(Tsedalu 2017; Munuyee 2018,Nacke, 2021). Regarding the actors, the literature review showed
that smallholder tree growers and traders are the two types of chain operators (Barbiche and
Alemu 2016; Tsedalu 2017; Munuyee 2018,Nacke, 2021). Both functional stages and actors are
visualized in Figure 2. The first two stages “input-supply” and “production” group the activities
needed for woodlot establishment and management, which are done by smallholder tree growers.

The following stages of “processing” and “trading” are handled by a network of traders,
involving the activities of harvest, pole processing, trade, and transport

Figure 2 Conceptual framework of the description of the Eucalyptus pole value chain (SOURCE:
Nacke (2018: P.11)).
CHAPTER THREE
METHODOLOGY
Description of the study area

Addis Ababa is the capital and largest city of Ethiopia. Addis Ababa is divided into 11 sub-cities
called kifle-ketemas and 120 woredas, which are the lowest administrative units. Addis Ababa
subcities are: Addis Ketema, Akaki Kaliti, Arada, Bole, Gulale, Kirkos, Kolfe Keran, Lideta,
Nefas Silk, Yeka and Lemi Kura. The latitude of Addis Ababa is 9.005401, and the longitude is
38.763611. Addis Ababa is located at Ethiopia country in the City place category with the GPS
coordinates of 9° 0' 19.4436'' N and 38° 45' 48.9996'' E. The selected three sub-cities for this
research are Akaki kality, Nifas silk, and Lami Kura sub cities in Addis Ababa.

Akaki Kality: is one of the ten sub cities of Addis Ababa and is the industrial zone of Addis
Ababa as well as the country. The latitude of Akaki Kality, Addis Ababa, Ethiopia is 8.895831,
and the longitude is 38.789162. Akaki Kality, Addis Ababa, Ethiopia is located at Ethiopia
country in the Districts place category with the GPS coordinates of 8° 53' 44.9916'' N and 38°
47' 20.9832'' E. And it is located 2,140 m above sea level (LatLong.net, 2012-2017). The district
is the southernmost suburb of the city and borders with the districts of Nifas HYPERLINK
"https://en.wikipedia.org/wiki/Nifas_Silk-Lafto" Silk- HYPERLINK
"https://en.wikipedia.org/wiki/Nifas_Silk-Lafto"Lafto and Bole.

Lemi kura: The new sub-city, Lemi Kura, has ten woredas, they are formed by dividing the 12
woreda of Yeka and 13 woreda itself and 10 and 11 woredas of bole. Accordingly, Eka Abado
condominium, Ayat, Bole Lemi Industrial Park area, Bole Arabsa and Ayat condominium areas
will be included in the new sub-city.

Nifas Silk Lafto: Sub-city is one of among the eleven sub cities in Addis Ababa with a land area
of 5876.02 hectares and this constitutes 11.31% of the total land area of the city which makes the
sub-city in 5th place in area size amongst 11 sub-cities. Nifas Silk Lafto Sub-city is located in the
South-West edge of Addis Ababa. The Sub-city is bounded by Kolfe Keraniyo Sub-city in the
North-West, by Bole and Akaki Kality Sub-cities in the East, by Lideta and Kirkos sub-cities in
the North and Oromia regional state in the South. This sub-city located 8° 57' 26" N and 38° 43'
30" E Latitude and longitude respectively. As of 2011 its population was of 335,740.

Figure 3. Map of Addis Ababa and the selected sub cities. Source:Wikipedia.

Research Design
The study will use mixed (qualitative and quantitative) research approach. Descriptive research
design will be used for analyzing the value chain of Eucalyptus globulus pole in the case of
selected three sub cities in the Addis Ababa city administration. Cross sectional study will be
used to collect the required data. After the data obtain from questionnaires, interview, and
physical observation then the research will be analyzed. The research paper is going to apply
both primary and secondary data sources.

Target Population

The target populations of the study are tree growers, traders, consumers and all actors
contributed for the exploration of the value chain of Eucalyptus pole in N/S/L, Akaki Kality and
Lemi Kura sub cities, Addis Ababa.

Sample techniques and size

Normally, due to large number of population size, in many of the cases, a complete coverage of a
population is not possible. Thus, sampling is one of the methods, which allows the researcher to
study a relatively small number of units representing the whole population (Saratnakos, 1998).
The study will be used both probability and Non-probability sampling design. The Non-
probability sampling will be used Judgmental or purposive sampling method to select from two
sub-cities. The researcher selects some of experienced actors from each sub cities for interview
purposes until the required data will be saturated. In addition to this, a stratified random
sampling method will be used in this study to select the number of sample respondents
proportionally from each stratum.

After this, the researcher will use systematic sampling method to select the respondents from
each actors involved in eucalyptus globulus pole. The sample size of the study will determined
by using Slovin’s formula stated as follows, since this formula allows the research to sample the
population with a desired degree of accuracy and gives the research an idea of how large the
sample size needs to be to ensure a reasonable accuracy of results.

,
n=
where n= sample size, N= size of total population
e= margin of error of 5% with 95% confidence level.

In order to proportionally distribute the samples among the strata the formula below will be
implemented (Yamane’s, 1967).

nh= (Nh/Ns)n

Where: nh = Sample size from each stratum

Nh = Total population from each stratum

Ns = Total population of the sum of strata for the study

n = Total sample size from the study population

Sources of Data

To collect consistent data and to reach to the targeted solution of the problem, the study will be
used both primary and secondary sources of data. Value chain analysis depends on multiple
sources of data, for a deeper understanding and investigation of the whole process, for actors
involved, and for complex issues in the system. Therefore, this study will be conducted as a case
study, for the investigation of the value chain of Eucalyptus globulus pole in N/S/L, Akaki Kality
and Lemi Kura sub cities, Addis Ababa.

Data collection Method

Structured and semi-structured questionnaires will used to collect information on Eucalyptus

globulus pole. For farmers, traders, and other key actors throughout the Eucalyptus globulus pole
VC, the information will be gathered from interview people including input costs, output
quantities, and sales prices for farmers, traders, and other actors. Prior to the survey, a primary
survey will be conducted to familiarize the participants with the study area, and questionnaires
will be tested for validity. The method of gathering information will include direct observation.
Furthermore, focus group discussions will be held in order to obtain general information about
the contributions of Eucalyptus globulus poles to their livelihood. The questionnaires will be
provided to the respondents to fill it either by themselves (if they can read and write in English)
in case of eucalyptus globulus pole owners. In addition, face to face interview and physical
observation of the work area will be done on the some selected, experts and experienced person
during data collection time.
Primary data collection
Various approaches will be used to collect the primary data. Field observation, key informant
interviews, focus group discussions, and market assessment are some of the approaches are
available will be used. Data will be acquired in both quantitative and qualitative formats. To
conduct the interviews with the many major actors in the chain, the structured, semi-structured
and unstructured questionnaires will be used to interview key informants.

Secondary data collection

Literature and data collections: Secondary data will be collected from literature and other
researchers’ findings, files, office manuals, policy papers, books, published and/or unpublished
government documents, websites and reports will be reviewed to make the investigation
meaningful.

Method of data analysis

 After the data will be collected from the study area, various methods of analyzing data will be
used on the raw data collected to make it meaningful. Descriptive and inferential methods of data
analysis will be used to achieve the required results of the investigation. To analyze the data
obtained from the questionnaires, appropriate statistical tools like percentage, mean, variance,
charts, graphs, tables, ANOVA, correlation, and regression models will be used wherever they
are necessary. Explanatory analysis method will be used to analyze qualitative data.

SCHEDULE
Time schedule
January February March April May June
Weeks Weeks Weeks Weeks Weeks Weeks
1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
ew
proposal

collection
anizing and
revise data.
value chain
pole
tion and

clusion and
n writing
f draft the

he thesis
hesis
Table 1 schedule

BUDGET REQUIRED FOR THE STUDY

 Qt
No Category/Item Description/ Unit y Unit Total price Rem
Specification Price k
s (ETB)
Stationary
Paper Double A4 Pac. 2 1250 2500
Pen Bick (Blue) Pcs 10 15 150
1. Pencil Pcs 2 10 20
Notebook Pcs 1 120 120

Mobile card Pcs 10 100 1000

Flash 32GB Pcs 1 350 350

CD RW Pcs 10 45 450
Secretarial and binding service
To print and bind research proposal paper Pcs 5 30 150
To print questionaries’ paper distributed to Pcs 150 15x1 2250
collect data from study areas.
2. For Final print the research paper for defense Pcs 5 90x1 450
For final print, laminate and binding the research Pcs 3 500 1500
Paper after defense
For internet router Pcs 1 1350 1350

For internet bill Month 6 500 3000

Per-Diem cost for transportation
Taxi transportation cost to gathering data Taxi km 200 10 2000
collection from studies areas.
3. Bajaj transportation cost to gathering and data Bajaj km 100 20 2000
collection from study areas.
Researcher per-dime Daily rate/birr Day 20 300 6000 1pers
n
Total 23,290.00
Contingency cost (10%) 23,290.00
Sum Total 25,619.00
Table 2 budget

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