The Future of Smallholder Farming in Eastern Africa - Uganda ...

Table 2.12: Type of buyers frequently visit brokers’ stall
Buyer type Yes No
Retailers 48 (71.6%) 19 (28.4%)
Flourmill operators 54 (80.6%) 13 (19.4%)
Flour factory owners 34 (50.7%) 33 (49.3%)
EGTE 6 (9.0%) 61 (91.0%)
Private wholesalers 39 (58.2%) 28 (41.8%)
Institutions (DPPC, NGOs, 14 (20.9%) 53 (79.1%)
etc.)
Hotels, hospitals, schools, 15 (22.4%) 52 (77.6%)
army, etc
Source: Survey, 2002.
The sample brokers revealed that most buyers come with adequate information about the
prevailing market prices. Buyers may also check prices by asking different brokers, retailers,
and wholesalers before their final decision. It is also customary to bargain for lower prices. A
few buyers come with limited information and hence they are in a weak bargaining position
vis-à-vis sellers (brokers) and pay relatively higher prices (Table 2.13).
Some buyers try to influence grain prices mainly by bargaining for lower prices, reducing the
quantity of their purchase, postponing purchase decisions, and switching to other brokers
(Table 2.14). These practices have a depressive impact on prices, especially when supply
exceeds demand. For instance, postponing purchases could mean that supplies accumulate
and the central market becomes jammed with an excessive number of trucks. Some buyers
may even collude among themselves to set prices.
Table 2.13: Buyers’ information about grain prices
Buyer type
Most come with
adequate information
Most come with
limited information
Most come with no
information
Retailers 45 (91.8%) 3 (6.1%) 1 (2.0%)
Flourmill operators 44 (81.5%) 10 (18.5%) 0
Flour factory owners 23 (69.7%) 9 (27.3%) 1 (3.0%)
Ethiopian Grain Trade 4 (100.0%) 0 0
Enterprise (EGTE)
Private wholesalers 33 (86.8%) 3 (7.9%) 2 (5.3%)
Institutions (Disaster
6 (46.2%) 5 (38.5%) 2 (15.4%)
Prevention and
Preparedness Commission
[DPPC], NGOs, etc)
Hotels, hospitals, schools,
army, etc.
8 (53.3%) 6 (40.0%) 1 (6.7%)
Source: Survey, 2002.