Regional Markets
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3 Cases<br />
opportunities need to be conducted. The third area is to conduct an in-depth study and<br />
devise solutions for improving transport. The fourth area is access to financing. RUDI<br />
has already been talking with Stanbic Bank, on the development of two new products: a<br />
warehouse credit scheme (providing farmers with immediate credit against their stock)<br />
and provision of working capital needed for farming larger areas (particularly important<br />
in the irrigated areas). RUDI can also be helpful in other areas, like developing farmers<br />
associations and enhancing management skill; policy issues around regulatory access; and<br />
investigating opportunities to market Tanzanian cereals in the neighbouring countries.<br />
Rural Urban Development Initiatives (RUDI)<br />
Main opportunities<br />
• As staple foods, maize and rice have a continuous and relatively high demand.<br />
• Providing irrigation in concentrated areas can greatly increase smallholder productivity.<br />
• Cereals create employment and involve many cash transactions, thus stimulating the local economy.<br />
• Paddy rice has long storage life, and farmers can hold on to their stock until market prices are high.<br />
• Milling is more profitable than farming, which creates an interesting investment opportunity.<br />
• Many services are available to smallholders, but need to be better coordinated and made<br />
more affordable.<br />
Key obstacles<br />
• Market information from the Dar es Salaam wholesale market is not available at the farm and<br />
village level.<br />
• Rice production is primarily rainfed marked by low productivity primarily subsistence use<br />
(not marketing-oriented production).<br />
• Cash flow constraints seriously hamper the ability of small-scale farmers to secure inputs and<br />
often force smallholders to sell their crop at lower prices.<br />
• The cereal value chains are long, fragmented, uncoordinated and involve many actors.<br />
• Information on new agronomical and technological alternatives for improving production is<br />
not reaching farmers.<br />
• There is a large unmet immediate demand for trainings, especially in basic business management<br />
for farmers and millers.<br />
• There are only a few successful farmer associations (mostly in irrigated areas).<br />
• The big price fluctuations throughout the year (on average about 100% of the base price) bring<br />
a lot of risk to the sector and promote speculation.<br />
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