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3 Cases opportunities need to be conducted. The third area is to conduct an in-depth study and devise solutions for improving transport. The fourth area is access to financing. RUDI has already been talking with Stanbic Bank, on the development of two new products: a warehouse credit scheme (providing farmers with immediate credit against their stock) and provision of working capital needed for farming larger areas (particularly important in the irrigated areas). RUDI can also be helpful in other areas, like developing farmers associations and enhancing management skill; policy issues around regulatory access; and investigating opportunities to market Tanzanian cereals in the neighbouring countries. Rural Urban Development Initiatives (RUDI) Main opportunities • As staple foods, maize and rice have a continuous and relatively high demand. • Providing irrigation in concentrated areas can greatly increase smallholder productivity. • Cereals create employment and involve many cash transactions, thus stimulating the local economy. • Paddy rice has long storage life, and farmers can hold on to their stock until market prices are high. • Milling is more profitable than farming, which creates an interesting investment opportunity. • Many services are available to smallholders, but need to be better coordinated and made more affordable. Key obstacles • Market information from the Dar es Salaam wholesale market is not available at the farm and village level. • Rice production is primarily rainfed marked by low productivity primarily subsistence use (not marketing-oriented production). • Cash flow constraints seriously hamper the ability of small-scale farmers to secure inputs and often force smallholders to sell their crop at lower prices. • The cereal value chains are long, fragmented, uncoordinated and involve many actors. • Information on new agronomical and technological alternatives for improving production is not reaching farmers. • There is a large unmet immediate demand for trainings, especially in basic business management for farmers and millers. • There are only a few successful farmer associations (mostly in irrigated areas). • The big price fluctuations throughout the year (on average about 100% of the base price) bring a lot of risk to the sector and promote speculation. 59
<strong>Regional</strong> <strong>Markets</strong> for Local Development Abbreviations MAFS MSE NSGRP RUDI WRS Ministry of Agriculture and Food Security Micro – Small Enterprises National Strategy for Growth and Reduction of Poverty Rural Urban Development Initiatives Warehouse Receipt System References Value Chain Analysis of rice and maize in selected districts in Tanzania. Volume 1: introduction, context analysis and recommended way forward. Final report. November 2010. Study commissioned by ACT- Tanzania Agricultural Partnership funded by EU-EC Food Facility Grant No. 2009/213-569. Conducted by Match Maker Associates Ltd). 60
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Editors: Fred Zaal, Jacqueline Slui
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Regional Markets for Local Developm
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Acknowledgements Acknowledgements F
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Foreword Bart de Steenhuijsen Piter
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Page 12 and 13: 1 Introduction The challenge is to
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