New technologies to link farmers and buyers
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CTA. 2008. New technologies to link farmers and buyers. Rural Radio Resource Pack 08/5. Wageningen, The Netherlands: CTA.
Permanent link to this item: http://hdl.handle.net/10568/57262
How the Malawi Agricultural Commodity Exchange uses SMS messages and other means to disseminate market info
New technologies to link farmers and buyers Cue: For thousands of years in every country in the world, buyers and sellers have been meeting in markets to trade their goods. That?s now changing. Communication technologies mean that people no longer have to physically meet in order to trade. Deals can easily be done over the internet or over the phone. In Africa a communication revolution is transforming the way that business is done, and with the spread of mobile phone networks, this is true even for smallscale farmers. Using new technologies, agricultural commodity exchange organisations are able to link farmers and buyers in ways that are quicker and easier than ever before. Sydney Khando, of the Malawi Agricultural Commodity Exchange, told Excello Zidana just how it is being done. IN: ?The objective of Malawi Agricultural ? OUT: ? most of the smallholder farmers.? DUR?N: 6?05? BACK ANNOUNCEMENT: Sydney Khando of the Malawi Agricultural Commodity Exchange. The interview comes from a resource pack produced by CTA. Transcript Khando The objective of Malawi Agricultural Commodity Exchange is to make markets work better for smallholder farmers by linking buyers and sellers of commodities. Now the information which the farmers need is, where are the buyers? The buyers are the market. So this brings that information to the farmers to say, here are the buyers, where are the commodities? Zidana Are there any other ways which MACE uses the information, apart from facilitating the linkage among producers, who are farmers and buyers as well? Khando I think before I answer that question I need to state here the information we collect and disseminate, one is the price information. The prices of commodities from various markets in Malawi, there are over 50 commodities. That information is collected on a daily basis. This information is then disseminated either by email or cell-phone, or directly to different users. The essence of the Malawi Agricultural Commodity Exchange System is that farmers, wherever they are can access this information, by mobile phone, simply using an SMS, by dialling in to a number, making an enquiry. For example, if they want the price of maize in Mzuzu, they can know. If they want the price of tomatoes in Mulanje, in Muloza, they can know. So there are markets where farmers can find the prices of commodities. The other information is the market opportunity information, that is the buyers who are going to buy their commodities. Now we disseminate this information through these media that I have said. And now coming to your question, we also use the radio to disseminate the same information, which is also a very strong tool, in terms of reaching out to the smallholder farmers. Or instead of smallholder farmers, reaching out to buyers, possible buyers of their commodities. Zidana And do you think Malawian farmers are progressing using this system? Khando Using the SMS system, yes. We feel that farmers are really progressing using this system. Because you know this system, you just need 10 units then you have got the information. If a farmer is selling a commodity and is looking for a market, he just sends it by SMS, don?t need to phone. So in a way the system saves money for the farmers. And the farmers don?t need to travel. They can sit in Karonga, Chitipa, Nsanje, wherever in Malawi, wherever they are, as long as there is a cell-phone network. They send information to Malawi Agricultural Commodity Exchange, while they are busy cultivating in their fields and continuing to work, instead of wasting time to go and look for the markets, at the cost of 10 units. And then the Malawi Agricultural Commodity Exchange looks for the market for them. Zidana Do you have a practical example of a farmer who has actually benefited from this system? Khando Yes there are a lot of farmers who have benefited from this system. If you need one farmer, there is Mr Kanizani, who we managed to link to the fresh produce market, to Shoprite and to other chain superstores. The thing that has helped him is the SMS system, because he doesn?t come to Lilongwe, he just sends an SMS and says, ?Look I?ve got these tomatoes.? Or if we need something, we just SMS to him and say, ?Shoprite is looking for these commodities,? and then he comes and delivers, just spending the money for transport and that?s all. Zidana I went somewhere last time and I found a big blackboard posted outside the shop and that shop was indicated Malawi Agricultural Commodity Exchange. Can you tell us something about that blackboard? Khando Blackboard is used as a trading floor. What happens is when we collect the information from different companies needing commodities, or about prices, they are sent by SMS to that office which you saw, and the officers in that office, they retrieve the messages from the SMS and write them on the blackboard. Now on the blackboard they would write, ?Lilongwe, they are looking for 10 metric tons of groundnuts,? or ?In Zomba they are looking for 100 metric tons of the following commodity.? And that blackboard is put outside where there are people passing, so that when the people check they are able to look for opportunities, and it has meant for smallholder farmers to identify opportunities which they can actually tap in. So the blackboard is one of the tools which we are using. Zidana You also talked about the radio. How does the radio work in this context? Khando This radio programme is broadcast on MBC Radio 1, and it?s a live phone in radio programme. Any farmer who has got anything, or any company that is looking for anything, they just phone in and say, ?I?m so and so from this area, I?ve got 5 head of cattle, I?m selling at this price.? The buyers are listening, so this one phones and says ?I?ve got this,? the next phone call is from the buyer looking for that, saying ?This farmer was advertising this, I?m looking for this commodity.? So it is a live phone in. The buyers phone in, the sellers phone in, and they get linked and trade on air. Zidana Now, in your own analysis, since the launch of this project, are farmers who are participating in this improving? Khando The farmers are improving very, very much, in fact areas where farmers commodities would not find markets are able to find markets, simply because they know now, they have got information, that their commodities?before they just used to hear rumours and the like, but now, if they are linked to the system and we are able to send a message to their phones, they know what is being sold in Lilongwe at what price, what is being sold in Mzuzu at what price. So yes, the farmers lives are improving because they are able to access more markets than they used to access before they used the SMS system. Zidana Hopefully you have visited a number of countries, to make sure that you know what you are doing. How are farmers progressing in other countries? Khando The problem that farmers are facing in Malawi, is the same problem that farmers are facing in Kenya, the same problem. Smallholder farmers? problems are almost the same, and marketing is the biggest challenge, is the biggest problem for most of the smallholder farmers. End of track