The functions of a strategic grain reserve are essentially humanitarian in character. As is common with most humanitarian activities, many of the operations which will be undertaken by the reserve are inherently non-commercial and are therefore liable to incur financial losses. The humanitarian, and social, functions that the reserve is expected to perform are decided by government and should be clearly spelt-out at the time of its establishment along with the circumstances, and the manner, in which, the reserve is expected to be used in the event of adverse conditions arising. A strategic grain reserve is therefore one of the tools available to government to support its humanitarian responsibilities and its social policies. As such the government must be prepared to provide the necessary financial support, through periodic financial injections, if the reserve is to be able to sustain its activities.
Taking these factors into account, it is to be expected that ownership of the reserve will ultimately rest with government. Government, however, may choose to operate the reserve through a government department, e.g. the Food Security Department in Tanzania, or appoint a semi-autonomous agency, e.g. the Food Reserve Agency in Zambia, to administer the reserve on its behalf. Alternatively, it could appoint the parastatal grain agency, e.g. NCPB in Kenya, or a commercial organisation, e.g. as ADMARC is in the process of becoming in Malawi, to administer the reserve on a management fee basis. Whichever option is selected the government would ultimately be responsible for the cost of maintaining the reserve.
