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Who Gained and Who Lost from Zambia's 2010 Maize Marketing Policies?

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Author Info

  • Nkonde, Chewe
  • Mason, Nicole M.
  • Sitko, Nicholas J.
  • Jayne, Thomas S.

Abstract

Zambia's record-breaking maize harvest of nearly 2.8 million metric tons (MT) in 2010 is a major achievement and a testimony to what input subsidies, output price incentives, and favorable weather can do to elicit a major supply response. Maize-growing smallholders harvested more than in previous years and so have more to eat. Public markets are currently well stocked with maize grain, to the benefit of urban consumers and maize-buying rural households. Farmers who were able to sell their crop to the Food Reserve Agency (FRA) at K65,000 per 50-kg bag, a price well above market levels, have clearly benefited from the bumper crop and FRA‟s involvement in maize marketing. The FRA‟s high buy price and purchase of nearly 900,000 MT of maize are also likely to have put upward pressure on market prices for maize. As a result, farmers who sold maize to private sector buyers may have benefited indirectly from the FRA‟s activities. However, the policies adopted by the Zambian government (GRZ) to handle the 2010 maize bumper crop have produced both winners and losers. This paper examines the key features of the 2010/11 GRZ maize marketing policies and their likely income distributional effects on various stakeholder groups: large-scale farmers, three categories of smallholder households (net sellers of maize, net buyers of maize, and those that neither buy nor sell maize), urban consumers, millers, traders, and government. We then propose a set of alternative policies GRZ could use to manage future maize bumper crops and explore the likely distributional effects of these policies on the various stakeholder groups.

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Bibliographic Info

Paper provided by Michigan State University, Department of Agricultural, Food, and Resource Economics in its series Food Security Collaborative Working Papers with number 99610.

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Date of creation: Jan 2011
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Handle: RePEc:ags:midcwp:99610

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Related research

Keywords: food security; marketing; agricultural policy; zambia; Agricultural and Food Policy; Food Security and Poverty; International Development; Marketing;

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References

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  1. Dorosh, Paul A. & Dradri, Simon & Haggblade, Steven, 2009. "Regional trade, government policy and food security: Recent evidence from Zambia," Food Policy, Elsevier, vol. 34(4), pages 350-366, August.
  2. Burke, William J. & Jayne, Thomas S. & Chapoto, Antony, 2010. "Factors Contributing to Zambia’s 2010 Maize Bumper Harvest," Food Security Collaborative Policy Briefs 97034, Michigan State University, Department of Agricultural, Food, and Resource Economics.
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Cited by:
  1. Nicole M. Mason & Robert J. Myers, 2013. "The effects of the Food Reserve Agency on maize market prices in Zambia," Agricultural Economics, International Association of Agricultural Economists, vol. 44(2), pages 203-216, 03.
  2. Kuteya, Auckland N. & Jayne, Thomas S., 2012. "Is the Government of Zambia’s Subsidy to Maize Millers Benefiting Consumers?," Food Security Collaborative Working Papers 140905, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  3. Sitko, Nicholas J. & Jayne, Thomas S., 2012. "The Rising Class of Emergent Farmers: An Effective Model for Achieving Agricultural Growth and Poverty Reduction in Africa?," Food Security Collaborative Working Papers 140907, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  4. Ricker-Gilbert, Jacob & Mason, Nicole M. & Darko, Francis & Jayne, Thomas S. & Tembo, Solomon, 2013. "What are the Effects of Input Subsidies on Maize Prices? Evidence from Malawi and Zambia," Food Security Collaborative Working Papers 154938, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  5. Ricker-Gilbert, Jacob & Mason, Nicole & Jayne, Thomas & Darko, Francis Addeah & Tembo, Solomon, 2013. "What are the effects of input subsidy programs on equilibrium maize prices? Evidence from Malawi and Zambia," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 149259, Agricultural and Applied Economics Association.

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