Case Study: The Reorganization of Zambia’s maize market (2010) cont… Re-Organized Formal Maize Market Structure: •thinly traded private market channels •number of private market actors and the volume of maize held by the private sector highly constrained •Higher market presence of FRA Re-Organized Informal Maize Market Structure: •small-scale maize buyers and sellers linked to hammer mills, commercial trading and milling firms •actors are poorly capitalized and tend to transact in small volumes of maize •greater influence on total maize transacted per year •informal small-scale traders provide a valuable market intermediation •considered the most reliable source of maize supply from the smallholder sector The broad effects of the structure of the new formal maize market: •Decrease in available supplies, both through disincentives to commercial maize production and through losses resulting from inadequate public storage •Consolidation within the trading, processing, and retailing sectors, leading to an overall decline in competition within the sector, however an increase in total maize exports created a competitive global Zambian maize market The broad effects of the structure of the new informal maize market: •Small-scale traders could generally provide maize to local retailers at competitive prices relative to formal wholesale markets •The informal maize market provided low income consumers with the option of acquiring low cost grain from market retailers #kindly #share #your #thoughts
