Role of National Food Reserve Agencies in Agricultural Market Development: New Policies and Practices Samrat Singh Research Associate(food policy) CEP.

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Presentation transcript:

Role of National Food Reserve Agencies in Agricultural Market Development: New Policies and Practices Samrat Singh Research Associate(food policy) CEP Lunchtime Seminar-04 Feb 2015

What are national food reserves? National buffer stock institutions responsible for grain procurement, storage, marketing and distribution Para-statal, government dept, independent company Commodities- non perishable staples: maize, millet, cow pea, sorghum, rice Principal regulatory institution

Market control instruments Marketing boards/development corporations Restrictions on private grain trade Local market controls Movement levies Milling levies at fixed price

CASE STUDY NFRs GHANA:National Food Buffer Stock Company(NAFCO) NIGERIA:Strategic Grain Reserve Department KENYA: National Cereal and Produce Board (NCPB) ETHIOPIA: Emergency Food Reserve Security Administration(EFSRA) MALI: Office des Produits Agricoles du Mali (OPAM)

GHANA 1950’s-60s  large scale mechanized-ADC(1962) 1966  individual farming-GMFC(food marketing) 1970  GLDB- grains/legumes 1971  GFDC(perishable goods)  1975(staples- GMP) 1970s  RMU (rice milling) 1990  GMP abandoned 2010  National Food Buffer Stock Company

Emerging regulatory framework CARRY FORWARD OBJECTIVESNEW OBJECTIVES Price stabilization Emergency reserves Act as buyer of last resort(GMP) Promote small holder /family farms Support agro- processing Create employment Promote nutrition sensitive agriculture

Targeting access barriers 1.Access to productive assets 2.High transaction costs - fixed costs (FTC)-search for buyer -proportional costs (PTC)-transportation FTCs are more burdensome - Didactic relationship b/w market access- price/trade policies

Main Operational Components PROCUREMENT Third party/state trading/open ended  forward contracts/targeted farmer group(farm size/family farms) PRICING Price bands  minimum pricing  market driven pricing

STOCK DIFFERENCIATION Trading stocks  emergency reserves/regional reserves/virtual reserves STOCK LEVEL Targeted emergency supply levels- %age national marketable production STOCK RELEASE Subsidized distribution  market sale to SF/interface with commodity exchange/WRS

Floor price-open market price 2012

Key Policy Shifts s INTERVENTION POLICY PROGRESSION Marketing board monopoly/govt. dept License/quotas/tariff Price stabilization Floor pricing Regulatory Catalytic intervention New market devices Ltd company Statutory body

Research projects 1.Web based inventory & procurement management system-NAFCO 2.Development of pro-small holder procurement/pricing guidelines 3.Pilot linking school feeding to SGRD (Nigeria) 4.PPP workshop

Thank you!