Given the apparent benefits of market information, it might be thought that most countries would have a flourishing Market Information Service. Judging by the results of FAOs survey, that is far from the case. Adopting very undemanding criteria as to what constitutes an acceptable service, we managed, from a survey of 120 countries, to identify only 53 functioning Market Information Services. Moreover, from the information received, the utility of many of those services that meet our criteria must be open to some question.
The absence of or poor performance of such services does not seem to be due to any lack of appreciation of their importance. However, problems with operating MIS are numerous. The main constraints appear to stem from lack of resources, not so much to establish an MIS, where donors are often prepared to assist, but to maintain it in efficient operation after the donors have left. Particularly in this day and age when governments are under strong pressures to cut expenditures, it is often difficult to maintain political support for services with few visible benefits.
Market Information Services stand or fall on the quality of their information. Frequently, however, this aspect of the service is given inadequate attention. Training of data collectors is often forgotten. With inevitable staff turnover, there is a danger that within a few years most of the collectors are people who have had no training. Data collectors frequently lack resources for transport to and from their markets. Where donors have provided transport, e.g. motorcycles, local budgets are often insufficient to meet fuel and maintenance costs. Resources restrict the training that can be carried out and also restrict the ability of head office to send out inspectors to check on the work of field staff. Salaries can be very low. A consequence of all this is that price reporting can become mechanical, with reporters paying little attention to the accuracy of their work.
The question arises as to who should be responsible for collecting the information. Ideally, they should be people who are solely responsible for market information and have no other job. At the same time, full-time market information staff puts up costs and countries are thus often forced to use the services of government officers who have other responsibilities. This was noted as a weakness of an MIS in Benin, for example, where staff of the central MIS unit felt they had little control over those collecting the data.
Apart from having to overcome the natural suspicion of government officers (many traders try to evade taxes!), price collectors have to face problems such as calculating the weight of the produce (in many countries trading is conducted with traditional measures that can vary widely, or by heap that can change size hourly) and identifying the variety. They then have to get the price right. How to do this can be a problem in societies that tend to function on the basis of bargaining. In Kenya, price collectors were found to be using the first price given by the trader and not bargaining. This is understandable as, if the collector is going to the market every day, the value of bargaining with traders who know perfectly well who he is may be open to some question. Many markets carry out both wholesale and retail functions. Mistaking the two prices is a common mistake in data collection.
Data processing and transmission
Delays in transmitting, processing and disseminating price data can undermine the credibility of an MIS. Out-of-date market information is of little value. In the days when communication between major cities and government officers in the field was largely by government radio, transmission of information for Market Information Services presented many problems, not least of which was obtaining access to a radio, which often had to be shared by all government departments. In these days of modern communications by phone and fax, computer modem and, increasingly, E-Mail, the problems associated with transmitting information from the market where it is collected to a central processing unit should be less. Nevertheless, problems remain. Although many countries have sophisticated communications systems in place, government departments often cannot afford basic equipment, such as fax machines, and in countries where the power supply is unreliable, equipment often cannot be used or breaks down quickly. Where donors have provided equipment, recipient countries often experience problems in replacing it when it breaks down after, or even before, the donors have left. In countries with limited resources, a well-supplied MIS could often be better equipped than the office of the senior civil servant in a town or district. It is not unknown for MIS equipment to be commandeered by a senior officer, with a consequent breakdown in the service. A further problem is that budgets available to pay for phone calls or faxes are often limited. Difficulties in meeting phone bills are frequently faced, particularly where access to phones is not rigorously controlled.
Problems with dissemination are associated with guaranteeing that the information is accessible to the target audience and ensuring that the information is in a form in which it can be understood. Again, lack of resources is the major constraint to effective dissemination. Almost all countries surveyed by FAO reported that they were experiencing difficulties in this regard. Many services find that they do not have the resources to finance price broadcasts on the radio which, in most countries, is by far the most effective way of accessing small farmers. Radio stations, on the whole, do not regard market information broadcasts as news services but more as potential paid advertisements. This problem is growing as, under structural adjustment reforms, radio stations are being privatised or are expected to cover an increasing part of their operating costs and are demanding payment to carry broadcasts. However, Market Information Services have few opportunities to raise the funds, although they have tended to be very slow in exploring the possibility of sponsorship.
Many countries have technical problems in broadcasting country-wide. In southern Africa, for example, both Lesotho and Zambia experience problems. For farmers and small traders, alternative methods of announcing prices, such as newspapers and bulletin boards, do not have the same immediacy. Other problems with information dissemination include ensuring that the broadcasts are at a time when farmers and traders can listen to them. In Ghana, for example, prices are broadcast at 17.45, when most traders are in the markets, while in Benin broadcasts are at times when farmers would usually be expected to be in their fields.
It is also essential that the broadcasts are in local languages or only a few large traders will benefit. As just one example, in Guinea Bissau prices are broadcast in Portuguese, but the bulk of the farming community speaks Creole. However, use of more than one language inevitably increases the amount of air time required and hence the cost.
Units of measure used can cause problems of understanding. Holtzman reports that one Kenyan trader rapidly lost interest in published prices when he found out the hard way that a bag in Nairobi was nearly three times the size of a bag in his home town. Thus there is a need to find ways of standardising the information presented. This should not, however, go as far as an attempt to force the marketing system to change its established measures in favour of something more convenient for the MIS.
Information needs to be relevant to the target audiences. This means that considerable care must be taken to make sure that the type of price information provided is that which the user finds most useful. Small-scale farmers, for example, may find data on prices in their local assembly markets much more relevant than major city wholesale market prices. Uganda and Benin are two countries where farmers have complained that prices broadcast are not relevant to them because they lack transport to major city markets. Where governments have in the past or still do set official prices, farmers can mistake the prices broadcast for the official price. This implies that the introduction of an MIS must be accompanied by an extension and media campaign to explain to farmers the meaning of the prices being broadcast, and that such a campaign must be repeated on a regular basis. Some services would like to target consumers, but they generally only broadcast wholesale, not retail, prices. A survey in Senegal, for example, found consumers very critical of the output of the national MIS.
While many countries lack functioning MIS, in several there is a significant duplication of information activities. In Benin, for example, there are at least four national institutions collecting price information and disseminating it through various bulletins. This can cause confusion, particularly when there is no consistency between the data sets.
Box 3: The Zambian Market Information Service
As in most of Eastern and Southern Africa, agricultural marketing in Zambia is undergoing a major transformation. The country has liberalized maize marketing and is in the process of liberalising input marketing. The Market Information Service, set up by the Ministry of Agriculture with FAO assistance, has played an important role in facilitating this process, particularly in the case of maize produced by small-scale farmers.
Unlike Tanzania, for example, which prior to liberalisation had a flourishing parallel market in grains, maize marketing in Zambia was entirely controlled by the Government, first through NAMBOARD and subsequently through cooperatives. In Tanzania it was easy for the private sector to take over the parastatals trading activities but in Zambia traders were expected to start from scratch. The provision of market information was considered an essential step in encouraging such trade.
ZAMIS started operating in May 1993, although several of the staff had previously been operating a cooperative stock-management information system. Initially, priority was given to the needs of traders but it was always intended that ZAMIS would be extended to cater for farmers and by the end of 1995 this was being done. The Service is coordinated in the Ministry of Agriculture in Lusaka and price and supply information is collected in the field by Provincial Marketing Officers and their colleagues in the districts.
The Service collects and disseminates wholesale and retail prices for maize, maize meal, other food crops, fertilizer and seeds. In particular, the maize wholesale prices serve as reference prices for the private sector and, as such, play an important role in promoting produce movement from production to consumption areas.
With the launching of ZAMIS, information on prices and market developments was disseminated through three channels: weekly radio broadcasts, weekly market bulletins and price boards. All ran into problems. Debts by a different section of the Ministry meant that the radio station stopped accepting all material for broadcast. An increase in postal charges of 400 per cent made it impossible for the Ministry to finance distribution of the weekly market bulletin and the price boards did not generally find favour with farmers. Many of these problems were eventually resolved and the information returned to the radio and twice-weekly reports in a national newspaper were introduced, while the bulletin continued to be published thanks to sponsorship from a local bank. Future sustainability will depend very much on attracting and retaining such sponsorship.
ZAMIS has recognised that it is not sufficient just to publish
prices. Farmers must be able to interpret the data and must also be aware of
potential market outlets. For that reason, the Ministry is trying to introduce
local newsletters on a provincial basis to advise farmers on which traders are
buying and where. A small FAO project also trained extension workers and farmers
in how a liberalised market functions. The project paid attention to improving
on-farm storage, which is becoming increasingly important now that farmers have
no outlet for their crop immediately after harvest.
Box 4: Private Market Information in South Africa
Agritel is a privately run information service supplying access to market information from South Africas Fresh Produce Wholesale Markets as well as 11 major abattoirs throughout the country. The Fresh Produce Markets are computerised and all transactions (price and volume) are recorded. Agritel receives data daily on all the markets and it then processes and packages this data in a more user-friendly format. The result is a comprehensive, impartial service covering both price and volume data for all commodities, varieties, classes, sizes, and packages sold in all the markets.
Agritel started in 1990 and now has approximately 400 users who pay monthly fees ranging from R125 to R175 (approx. US$ 28-38) depending on the number of services and markets the user wishes to access. Users include individual producers, packers, members of the catering and hotel industries, butchers, wholesalers, market agents, and the markets themselves. In addition to paying the Agritel subscription fees, users must have access to Beltel, which is the national telephone companys electronic transmission network. Access can be obtained through a terminal which can be hired from the company, or alternatively through the use of a personal computer and modem. The telephone call to Beltel is toll-free which is important for users calling from long distances.
The Agritel interface through Beltel is completely menu-driven and easy to use. The system provides the following information for the current and previous days trading for each market:
In addition to the current trading data, users can access historical information using a specially designed graphics package supplied free of charge by Agritel to its larger customers. The historical information shows trends for the six years currently in the database or any subset for any commodity (specific variety, size, class, package) in any market. The programme easily allows the super-imposition on the data series of a moving average to allow the determination of trends.
The Agritel system allows the use of market information to its fullest
potential for both producers and those involved in marketing. The system
is, however, only cost effective because of the ease of access and availability
of fully computerised data from the Fresh Produce Markets. It is unlikely
that it would be commercially viable if the company had to collect the
information itself, rather than being able to rely on existing data sources.
In Zambia, the weekly market bulletin was very favourably received by traders. However, when postage rates went up and it was decided to charge traders for copies, very few took out a subscription. This may partly be explained by the fact that much of the information was available in a national newspaper, but does illustrate the difficulties of commercialising an MIS. One option considered for the future was that the price of an annual subscription should be included in the annual registration fee that traders are obliged to pay to Government.