4.3.6 ''Lessons learnt'' - recommendations

Potential for reducing the costs has been identified in the following areas:

· Increase of the total production and proportion of capacity used, especially in the months January, April, May, June, October, November and December.

· Reduce the costs of raw materials (by importing).

· Reduce advice and training of the Dominican producers of neem raw material.

In future the interrelationship between conventional pesticide usage and the potential market for neem should be investigated. Emphasis should be placed on two aspects:

· What are the conditions for integrating neem products into conventional trading channels?
· What investment is required for advertising, information materials and further promotion?

Furthermore, it is important to provide the following services for introducing neem pesticides? Training and advice to farmers on:

· Integration of neem pesticides into integrated pest management concepts (combination with other pesticides)

· Integration of neem pesticides into organic farming systems (combination with biological insecticides)

Credit for neem pesticides

Farmers in the Dominican Republic are used to buying insecticides on credit. For small manufacturers of pesticides this is a problem because they do not have sufficient capital. If the manufacturer were to cooperate with the agricultural supply trading companies, credit could be provided by the trading company.

Neem should not be made into a political topic. Neem pesticides do not compete, at least to date, with the entire market of synthetic pesticides, but only with single, more expensive insecticides of good quality (selectivity). Due to the MRL regulation the agricultural supply trading has increasingly to consider the needs and requirements of IPM. Neem could play an important role within IPM concepts. There is no reason for the agricultural supply traders not to sell such an efficient and successful product.

The same marketing rules apply to the production and distribution of pesticides as for other products. This means that the manufacturers of pesticides has to decide if they want to market their products by emphasising the price or the quality. Because of the comparatively high production costs, neem products cannot be marketed on price, but the quality and advantages of the products should be emphasised.

Future increase in sales of neem products mainly depend on the successful integration of neem pesticides into the conventional trading channels. Interviews of the retail traders reveal that the price of neem pesticides was not considered to be an important obstacle.

Need for investment

According to the analysis described above capital has to be invested in the marketing of neem products, especially to get FAMA's neem products into the conventional market channels. The trading agencies expect FAMA to supply them with information and advertising materials, advertisements for radio and TV, as well as print media.

Furthermore, sufficient samples for training and demonstration courses are required for the merchandisers.

All this adds up at least to approx. US$ 100000 which would be required for two years, which can be specified in a detailed marketing analysis.

Investment in processing equipment is not urgently needed until the capacity of the present plant is used to the full.

If more seeds are processed into oil, a surplus of neem cake can be expected which should be processed in an extraction unit.