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Metal silos hold grains for advance payments
The pilot effort with the GPLP project is running. Farmers loaded silos in November last year for 60’000 per bag and now the price has risen to 140’000 per bag. This high increase is unusual. It is because of a severe drought in many parts of East Africa, also in Msowero. Now farmers want to keep part of their maize in the silo for food security and only sell part of it. Of course this is a huge success for farmers. They still have maize in their households that they could safely store and they can sell any surplus at great profit. Shortly the silos will be emptied and the final calculations made to assess how it went for farmers and for the Biashara Mapema Network company to see how well this business can work. We expect to finish this pilot and come up with results by end March.
Short description of venture
Farmers have the opportunity to rent small metal silos for storing their grains. This enables them to sell the grains later when the prices have risen. However, farmers need cash at harvest time. Therefore the silos on rent are combined with a service of a) advance payments where the checked and locked grains act as the security, and b) assistance in marketing the grains in good markets when prices are higher through the "Transaction Security Services" of the Tanzanian company Biashara Mapema. Farmers therefore only have to think of a fixed fee for using the silo in order to get an advance payment when harvesting, and the rest when selling later. This is the first pilot to go through the mechanisms of a full cycle of storing and sales after a few months.
Status of financing
USD not yet raised
1. Full cycle of storing and sales with 20 silos in Msowero village
2. Full cylce of storing and sales with 20 silos in Magunguli village
Download research paper:
“Metal silo grain storage technology and household food security in Kenya”,
Zachary Gitonga, Hugo De Groote and Tadele Tefera, May 2015
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