| Summary: |
Between 2006 and 2011, Nicaragua shipped an average of US$ 9.4 million per year of smallholder-produced fresh taro (Colocasia esculenta) to the United States; however, by 2016, the US market for Nicaraguan taro had effectively collapsed. We analyse the short-lived taro boom from the perspective of complex adaptive systems, showing how shocks, interactions between value chain actors, and lack of adaptive capacity among chain actors together contributed to the collapse of the chain. Primary data was collected from businesses and smallholders in 2010 and 2016 to understand the actors involved, their business relations, and the benefits and set backs they experienced along the way. The results show the capacity of better-off smallholders to engage in a demanding market, but also the struggles faced by more vulnerable smallholders to build new production systems and respond to internal and external shocks. Local businesses were generally unprepared for the uncertainties inherent in fresh horticultural trade or for engagement with distant buyers. Existing guides and tools for designing value chain interventions will benefit from greater attention to the circumstances of local actors and the challenges of building productive inter-business relations under higher levels of risk and uncertainty. Results demonstrate the need for a greater awareness of adaptive capacity within marketing systems that involve smallholders, a more critical look at the underlying assumptions of interventions for building these value chains, and the need for alternative planning scenarios, better risk mitigation and adaptation strategies. This case serves as a wake-up call for practitioners, donors, researchers and the private sector on how to identify market opportunities and the design of more robust strategies to respond to them.
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