Warehouse Receipt Finance for Farmers – A Glimpse - MCX in Marathi

However, warehouse receipt finance is essentially a
speculative activity and requires serious monitoring of
grain quality as well as market price trends and
fluctuations. When properly designed and managed, a
warehouse receipt finance programme can allow small
farmers to graduate from the status of “price takers” to
that of “price negotiators” in the local market economy.
The mechanism can also provide rural entrepreneurs
with a route to capital accumulation that can be
invested in more diversified and sustainable ventures
capable of stimulating long-term rural economic
growth and development, which in turn can contribute
significantly to the overall economic growth in line
with national aspirations.
References:
1. Bamako (Technical Note No. 5). 2000. “Warehouse
receipts: financing agricultural producers”
2. Evans, Martin D.D., and Karen K. Lewis. 1992. NBER
Working Paper Series, No.4003
3. Hicks, Frank. 1998. “TechnoServe inventory credit
programme in Ghana”. United Nations Conference
on Trade and Development
4. Lacroix, Richard, and Varangis, Panos. 1996. “Using
warehouse receipts in developing and transition
economies”, Finance & Development
5. “Report of the Working Group on Warehouse
Receipts & Commodity Futures”. 2005. The Reserve
Bank of India
6. Rutten, Lamon. 2001. “Local market opportunities
with respect to warehouse receipt finance -
tapping into the local capital market”, ESCAP-ADB
Joint Workshop
7. Rutten, Lamon. 2001. “Financial engineering
techniques for directly linking domestic capital
markets and the agricultural sector – a short note”,
ESCAP-ADB Joint Workshop
8. The World Bank (Agricultural Investment
sourcebook series). 2004. “Ghana: Inventory Credit
for Small-Scale Farmers”
Mr. Nachiket Mor is President, ICICI Foundation, and Dr. Kshama Fernandes is Vice-President, IFMR Trust. Views are personal.
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