6 November 2018

Rwanda: Study Calls for Revisiting of Potato Pricing Model

A study conducted last year has found that the minimum price set for potato farmers was being abused and that the farmers were the victims.

The research was informed by low prices or market issues expressed by farmers for their produce, lack of farmers' say in setting prices for their produce, and insufficient access to, and use of quality agricultural inputs (seeds, fertilisers, and agro-chemicals such as pesticides for crop protection), which adversely affects farm productivity.

It was commissioned by Rwanda Civil Society Platform (RCSP).

"Even as prices of potatoes increased to between Ref450 and Rwf500 a kilo of Irish potato in Kigali markets as of September 19, 2018, farm gate prices remained at Rwf191," said Dr Michel Rwibasira, one of the researchers who carried out the study.

Under the theme; "Analysis of Value Chain for Intensified Crops and market price in Rwanda," the case study: maize, Irish potatoes and rice, the research collected data from 577 respondents from across the three intensified crops (IC) in targeted districts producing such crops (Nyabihu, Musanze, and Burera [for Irish potatoes production]; Gatsibo and Nyagatare in Eastern Province; Ruhango and Gisagara in Southern Province, and Rusizi in Western Province.

Kimironko and Mulindi food markets in Kigali were also surveyed as well as views of consumers.

"Farmers requested that such profits should be redistributed evenly among all people engaged in the potato value chain, including farmers," he said.

They expressed their dismay for not having a say in what happens to their produce beyond harvesting, especially for Irish potatoes.

"There is a need to have farmer protection mechanisms against what they called unfair pricing; farmers need to be empowered to participate in value chain activities beyond production," reads part of the study.

The price of a kilo of potatoes to a farmer has been set at between Rwf140 and Rwf170 during peak season by the Ministry of Trade and Industry (MINICOM), after consulting different stakeholders in the business, including farmers' cooperatives and potato traders. The price depends on the quality and type of potato in question.

However, potato farmers, including Clemence Mukarugwiza of Karago Sector, and Martin Niyibizi from Kintobo Sector both in Nyabuhu District told The New Times that the set prices are sometimes not observed as they even sell as low as Rwf70 a kilo during the harvest period because there is large supply which overweighs the demand.

Currently, they said, a kilogramme of Kinigi potatoes is Rwf180 and Rwf120 to Rwf130 for other varieties.

"We are afraid that during the peak season in December, we will sell a kilogramme at about Rwf70, which is not profitable for us," Mukarugwiza lamented.

The Rwanda Civil Society Platform Chairperson, Jean Leonard Sekanyange said that when a farmer hears that a kilogramme of potatoes is Rwf500 in Kigali, yet they sold it Rwf180, they think that most of the proceeds are going to the dealer, not the farmer, which demotivates the farmer.

"That is why we request that concerned public institutions should ensure effective mechanisms for compliance with such pricing, and reinforce penalties against those who do not comply," Sekanyange observed.

"The price should be determined by market forces. When someone sets prices yet they are not the ones to buy the produce, it is sold at a lower price in case of oversupply and few buyers," he said.

The director of domestic trade at the Ministry of Trade and Industry (MINICOM, Cassien Karangwa said that there were some dishonest potato dealers who wanted to make excess profits from low potato produce that resulted from disasters such as foods that adversely affected farm produce from March this year, and they were selling potatoes at higher prices of Rwf450 and Rwf500.

"We have taken measures to inspect markets and punish such dishonest dealers who hike prices to make undue benefits," Karangwa said.

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