Online Reporter
Patience Maturure
Agriculture Reporter
THE current glut of agricultural produce at mass markets has left farmers unable to dictate prices, relegating them to price-takers incapable of dictating terms in sync with a vibrant economic landscape.
Prominent market analyst and Knowledge Transfer Africa chief executive officer, Dr Charles Dhewa, yesterday said the influx of diverse commodities in the country’s mass markets had transformed marketing dynamics significantly.
“Mass food markets are essential for mobilising goods from various regions of the country. However, the current abundance of commodities has created a scenario where individual farmers have little control over pricing, often forced to accept whatever rates the market dictates,” he observed.
Dr Dhewa said competition had intensified as more players entered the market, further complicating pricing strategies for farmers.
He added that many farmers had been left grappling with the challenges of establishing sustainable incomes while navigating fluctuating prices influenced by external factors such as seasonality and consumer demand. This situation calls for innovative solutions to empower farmers and ensure they can secure fair compensation for their hard work, he further explained.
“Every district is now participating in the market. Talk about fruits, talk about vegetables, grains and all commodities that you can think of,” he said.
Dr Dhewa said as a result, farmers had become mere price takers with market forces dictating prices.
“They are finding their way into the market, thanks to public transport, transporters and many other people who really are specialising in moving food.
“But then the biggest issue is price setting. The farmers are influencing prices as much as they would want,” he said.
Dr Dhewa called for a policy intervention in developing pricing models that take into account production costs and other factors.
“It looks like the more the quantities and diversity of commodities increase, the more difficult it becomes for farmers to set prices.
“This effectively means that farmers are really taking prices from the market, given that competition between commodities is now influencing prices,” he said.
Additionally, Dr Dhewa said shipment costs were also a significant factor and without intervention, farmers would continue to lose out on prices, making farming a less profitable venture.
“At the moment, transportation also influences prices, for instance, it costs about US$12 to transport a bundle of sugarcane from the Honde Valley. This is also the same price for transporting 90 kilogrammes of raw avocados and bananas. We are talking about a distance of approximately 340 kilometres or so,” he said.
He called for a conversation around pricing models that will in the end allow farmers to remain in business.
Dr Dhewa said collaborative efforts from relevant ministries were necessary to ensure farmers get good prices for their commodities.
“If we don’t intervene on the issue of prices, farmers will continue losing out on viable prices and farming will cease to be a profitable business after all.
“This will require stakeholders to exchange ideas on the matter with Ministries of Lands, Agriculture, Fisheries, Water and Rural Development, Industry and Commerce, Finance and Investment Promotion and Local Government working out a meaningful package for the farmers,” he said.
Dr Dhewa added that prices were the bottom line for agricultural profitability, hence the need for urgent action to come up with a permanent solution on the matter.
“When there is no one controlling or regulating the markets, farmers end up getting the shorter end of the stick so there is need for someone to bring some order in the marketing processes there,” he said.
