6 August 2013

Tanzania: Exporters Caution Over Envisaged Commodity Exchange

THE envisaged Commodity Exchange might not operate smoothly due to excessive market monopoly in the marketing of agricultural produce in some parts of the country, Tanzania Exporter Association (TANEXA) has warned.

Four cash crops--cashew nuts, coffee, cotton and rice are lined up as the first products to trade on the exchange that is expected to boost the country's exports and contribute to the national economic growth.

TANEXA Executive Director Mtemi Laurence said in an interview with the 'Daily News' in Dar es Salaam that there were unsettled problems with regards to marketing of traditional cash crops like cashew nuts and cotton.

He cited the presence of few crop buyers in some regions, for instance Singida that is famous for sunflower production, Mtwara and Lindi for cashew nuts, as a threat to establishment of the competitive commodity exchange.

Similar situation also prevails for rice where buyers from neighbouring countries go directly to producers due to absence of marketing centres where both parties could meet.

"There should be a well established warehouse systems across the country that could be used as market centres where buyers and sellers meet," said Mr Moremi, arguing that the centres would help in recording the quoted prices for various agriculture produce.

Kibaigwa maize market in Dodoma for instance is a typical model of the facility that help to attract buyers of maize from within and outside the country. For this, the government should establish a good number of such facilities across the country for the commodity exchange to work.

The Deputy Minister of Agriculture, Food Security and Cooperative, Mr Adam Malima said recently that the process to establish the commodity exchange market was under good progress, expressing hopes that it will start operating in less than a year.

The envisaged commodity exchange aims at providing centralised market place where producers and consumers can conveniently meet. Experts in agro-business have it that the exchange will liberate farmers from poverty through exposure to reliable domestic and export markets.

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