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

Table 4.4: How do you set a sales price
Method Number %
Consider purchase price and other costs 22 73.3
Depend on quality of grain and number of 3 10.0
buyers at Addis Ababa
Depend on demand and supply (including
season)
5 16.7
Source: Survey, 2002.
Only about 53 percent of the regional traders get price information in Addis Ababa via
telephone. Others rely on fellow traders who sold grain recently (26.7 percent). They also get
price information from transporters, who usually convey information about prices and other
messages to and from regional traders (Annex Table 4.5). However, the largest number of
traders get price information only once a week (29 percent) followed by the number of traders
who get price information three times a week (26 percent) (Table 4.5). Lack of information is
a severe constraint in the operation of regional traders.
Table 4.5: Frequency of getting price
information
Frequency %
Daily 22.6
Weekly 29.0
Three times per week 25.8
Twice per week 9.7
Twice per month 9.7
Four times per month 3.2
Source: Own computation.
Transport charges are high and vary from season to season. About 47 percent of traders
consider transport charges high, whereas half of them perceived the charges as average. But
transporters claim that the charges are low and that hence the transport business is not
profitable. Poor road conditions and the lack of a return load has increased the cost of
providing effective and low-cost transport services.
The results show that, like brokers and retailers, regional traders operate with a low asset base
and limited capital (both human and physical). They are also constrained by poor access to
finance, which limits their business activities. Credit from formal financial sources remains
out of the reach of many regional traders. Getting information on the quantity, quality, and
price of grain on a regular basis is also a problem as there is no organized system to provide
market information.