Review of the role of commodity exchanges in supporting smallholder farmer market linkages and income benefits
Recently the government of Ethiopia mandated that all of the navy bean trade is to done through the new commodity exchange. But the new business models for sustainable trading relationships team has been working on this crop in Ethiopia since 2008 to develop direct and transparent trading relationship to the final buyer. What are the implications? What is the potential for the commodity exchange to benefit small scale producers?
To gain insight into how the project might work with the new commodity exchange and still benefit small scale producers, the project commission a study of the 5 working country level exchanges in Africa. The results are provocative — while commodity exchanges have the potential to benefit producers through clear prices signals and uniform and regulated warehousing and trading system, none of these exchanges to date have made the investments infrastructure that would allow the small scale producers to achieve the potential benefits.
A New Business Model for Sustainable Trading Relationships publication
Author: Peter Robbins July 2010.
