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Why are African commodity exchanges languishing? A case study of the Zambian Agricultural Commodity Exchange

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  • Sitko, Nicholas J.
  • Jayne, T.S.

Abstract

Food price volatility and high transactions costs remain major problems in African food markets. These persistent problems provide a strong theoretical justification for the development of commodity exchanges. However, the majority of African commodity exchanges remain underdeveloped. Through a case study of the Zambian Agricultural Commodity Exchange (ZAMACE), this article explores why agricultural commodity exchanges in the region have thus far failed to develop into sustainable trading platforms and identifies the most important changes needed to enhance their performance.

Suggested Citation

  • Sitko, Nicholas J. & Jayne, T.S., 2012. "Why are African commodity exchanges languishing? A case study of the Zambian Agricultural Commodity Exchange," Food Policy, Elsevier, vol. 37(3), pages 275-282.
    • Handle: RePEc:eee:jfpoli:v:37:y:2012:i:3:p:275-282
    DOI: 10.1016/j.foodpol.2012.02.015
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    References listed on IDEAS

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    1. Smale, Melinda & Byerlee, Derek & Jayne, Thom, 2011. "Maize revolutions in Sub-Saharan Africa," Policy Research Working Paper Series 5659, The World Bank.
    2. Rashid, Shahidur & Winter-Nelson, Alex & Garcia, Philip, 2010. "Purpose and potential for commodity exchanges in African economies:," IFPRI discussion papers 1035, International Food Policy Research Institute (IFPRI).
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    Cited by:

    1. Boyd, Chris M. & Bellemare, Marc F., 2022. "Why not insure prices? Experimental evidence from Peru," Journal of Economic Behavior & Organization, Elsevier, vol. 202(C), pages 580-631.
    2. Alobo Loison, Sarah & Hillbom, Ellen, 2020. "Regional evidence of smallholder-based growth in Zambia’s livestock sector," World Development Perspectives, Elsevier, vol. 19(C).
    3. Liesbeth Dries & Domenico Dentoni, 2015. "Private sector investments to create market-supporting institutions: The case of Malawian Agricultural Commodity Exchange," Working Papers 2015/08, Maastricht School of Management.
    4. Manuel A. Hernandez & Shahidur Rashid & Solomon Lemma & Tadesse Kuma, 2017. "Market Institutions and Price Relationships: The Case of Coffee in the Ethiopian Commodity Exchange," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 99(3), pages 683-704.
    5. Meijerink, Gerdien & Bulte, Erwin & Alemu, Dawit, 2014. "Formal institutions and social capital in value chains: The case of the Ethiopian Commodity Exchange," Food Policy, Elsevier, vol. 49(P1), pages 1-12.
    6. Sitko, Nicholas J. & Kuteya, Auckland N., 2013. "The Maize Price Spike of 2012/13: Understanding the Paradox of High Prices despite Abundant Supplies," Food Security Collaborative Working Papers 171871, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    7. Fekadu Gelaw & Stijn Speelman & Guido Huylenbroeck, 2017. "Impacts of Institutional Intervention on Price Transmissions: The Case of the Ethiopian Commodity Exchange," Review of Development Economics, Wiley Blackwell, vol. 21(4), pages 88-106, November.
    8. Gelaw, Fekadu & Speelman, Stijn & Van Huylenbroeck, Guido, 2016. "Farmers’ marketing preferences in local coffee markets: Evidence from a choice experiment in Ethiopia," Food Policy, Elsevier, vol. 61(C), pages 92-102.
    9. Jayne, T.S. & Sturgess, Chris & Kopicki, Ron & Sitko, Nicholas, 2014. "Agricultural Commodity Exchanges and the Development of Grain Markets and Trade in Africa: A Review of Recent Experience," Food Security Collaborative Working Papers 188568, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    10. Goswami, Alankrita & Adjemian, Michael K. & Karali, Berna, 2022. "The impact of futures contract storage rate policy on convergence expectations in domestic commodity markets," Food Policy, Elsevier, vol. 111(C).
    11. Sitko, Nicholas J. & Chisanga, Brian, 2016. "How Is Multinational Investment in Grain and Oilseed Trading Reshaping the Smallholder Markets in Zambia?," Food Security Collaborative Working Papers 234948, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    12. Nicholas J. Sitko & Brian Chisanga & David Tschirley & Thomas S. Jayne, 2018. "An evolution in the middle: examining the rise of multinational investment in smallholder grain trading in Zambia," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 10(2), pages 473-488, April.
    13. Roche, Julian Spencer, 2020. "Success criteria for commodity exchanges," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 15(2), June.

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