Assessment of Alternative Maize Trade and Market Policy Interventions in Zambia

Abstract

Introduction: The economic reforms in maize marketing and trade policies implemented during the 1990s have been highly controversial, and there remains a lack of solid empirical investigation on the impacts of these reforms on national food security, price stability and rural income growth. This study aims to provide a detailed evidence-based analysis of the impacts of maize marketing and trade policies on smallholder agricultural production growth, access to food by consumers, and other important national policy objectives. These insights from Zambia can hopefully move forward the continuing debate in the region on how maize marketing and trade policies should be structured in the future. Data: The study relies on the combination of nationally representative rural household survey data, maize price information, and interviews of key stakeholders at various levels of the maize marketing chain as well as government officials. Estimates of annual maize production in Zambia is available from two sources. The first is the nationally representative Post-Harvest Surveys (PHS). The PHS is conducted annually by the Central Statistical Office (CSO) of the Government of the Republic of Zambia (GRZ). The other source of annual maize production estimates is the Crop Forecast Survey (CFS). The CFS is conducted annually by the Ministry of Agriculture and Cooperatives and this data is also the basis for trend analysis in aggregate agricultural production indices compiled by the FAO. Data from two nationally-representative surveys conducted in 2001 and 2004 by FSRP provided a comprehensive assessment of smallholder conditions in Zambia. Data on maize grain and maize meal imports and exports in Southern and Eastern Africa were obtained from the online Food and Agriculture Organization Agriculture Statistics (FAOSTAT). viii viii

Regional trade, government policy and food security: Recent evidence from Zambia

“…As a result, Zambian political leaders remain acutely aware of the political sensitivity of maize policy. This has led to a hesitation waltz of partial reforms, periodic backtracking and intermittent inconsistencies between stated policy and actual implementation (see Mwanaumo, 1994Mwanaumo, , 1999Howard and Mungoma, 1996;Jayne et al, 1999;Nijhoff et al, 2002, 2003and Govereh et al, 2008. After campaigning on a platform of maize market reform, the newly installed Chiluba government began its reform efforts in 1991 by dismantling NAMBOARD and issuing licenses to private maize traders.…”

“…Before independence in 1964, maize pricing policies favored commercial white farmers, who received 75% of the Maize Control Board's internal purchasing quota and re-0 500 1,000 1,500 2,000 2,500 1 9 6 5 1 9 7 0 1 9 7 5 1 9 8 0 1 9 8 5 1 9 9 0 1 9 9 5 2 0 0 0 2 0 0 5 production ('000 tons) ceived a 40% premium over the price paid to African farmers . But since independence, policies have favored smallholders, initially through pan-territorial pricing, expansion of government purchase to remote areas and input subsidies targeted to smallholder farmers (Govereh et al, 2008). While governmentsupported cooperatives and lending institutions supplied subsidized inputs of fertilizer and seeds to smallholder farmers, government's agricultural marketing parastatal, the National Agricultural Marketing Board (NAMBOARD), provided a guaranteed market, purchasing maize at a fixed pan-territorial price.…”

The effects of the Food Reserve Agency on maize market prices in Zambia

“…Prior to liberalization in the 1990s, maize marketing was controlled by the government agricultural marketing parastatal, the National Agricultural Marketing Board (NAMBOARD), which set pan‐territorial/pan‐seasonal producer prices for maize and also handled GRZ maize imports and distribution. NAMBOARD was abolished in 1989 and, shortly thereafter, private maize trade was legalized and pan‐territorial/pan‐seasonal maize pricing was eliminated (Govereh et al, 2008; Jayne and Jones, 1997).…”

“…Nowhere is this more prevalent than in Zambia. In recent years, the Government of the Republic of Zambia (GRZ) through the Food Reserve Agency (FRA), a parastatal strategic food reserve/maize marketing board, has become the country's dominant buyer of smallholder maize (Govereh et al, 2008; Tembo et al, 2009). The FRA buys maize from smallholders at a pan‐territorial price that typically exceeds wholesale private‐sector prices in major maize‐producing areas.…”

Electric‐Field‐Induced Reversible Viscosity Change in a Columnar Liquid Crystal

“…In Zambia, the requirements for the Food Reserve Agency (FRA), a Zambian government agency which assures strategic reserves of crop harvests for the whole nation, to purchase maize from farmers and other traders include maximum aflatoxin content of 10 ppb23 although the Zambian standard (ZS 186: 2004) for cereals and cereal products only stipulates that mycotoxins in maize grains should not be harmful to human health 24. Considering the place maize occupies in the diet of the population of Zambia, representing 68% of kcal intake estimated at 3600 kcal kg −1 energy value25 and its importance for smallholder farmers, accounting for about 76% of their total income value,26 it is necessary to do everything that is possible to minimise the risk of fungal contamination and guarantee its safety during post‐harvest handling and storage before processing into food. Food safety has increasingly become a major issue in global trade relations8 but the biggest challenges in food safety and agricultural health in Zambia relates mostly to domestic production and the domestic market 27…”