1. “THE ROLE OF WAREHOUSING IN AFRICA - LESSONS FOR IMPLEMENTATION FROM FOUR CONTINENTS” BY JONATHAN COULTER, NATURAL RESOURCES INSTITUTE, UK PRESENTED AT THE UNCTAD “PARTNERS FOR DEVELOPMENT SUMMIT”, LYON, FRANCE, 9 - 12 NOVEMBER 1998

2. SOME PROBLEMS FACING AFRICAN GRAIN MARKETING SYSTEMS HIGH SEASONAL PRICE VARIABILITY LIMITED PRICE TRANSPARENCY INADEQUATE REWARDS FOR HIGH GRAIN QUALITY POORLY OPERATING INPUT SUPPLYSYSTEMS

3. CONSEQUENCES OF MARKET IMPERFECTIONS STAGNATION IN PRODUCTION INCREASED IMPORTS GREATER FOOD INSECURITY CONTINUED DEPENDENCY ON DONOR SUPPORT THEREFORE WE NEED: “A RADICAL CHANGE IN AFRICAN GRAIN MARKETING SYSTEMS”

4. MEASURES TO ADDRESS THESE PROBLEMS BETTER MARKET INFRASTRUCTURE LESS GOVERNMENT INTERVENTION, PARTICULARLY AD HOC INTERVENTION BETTER LEGAL AND CONTRACTUAL FRAMEWORK CROP FORECASTING AND MARKET INFORMATION WAREHOUSE RECEIPTS

5. WHY WAREHOUSE RECEIPTS ARE A FUNDAMENTAL BUILDING BLOCK PROVIDE HIGH QUALITY COLLATERAL FACILITATE TRADING BY SPECIFICATION FACILITATE DEVELOPMENT OF TRADING - BILATERALLY OR THROUGH EXCHANGES CAN WORK DESPITE FAILURES IN OTHER AREAS

6. WAREHOUSE RECEIPTS IN AFRICA EXCEPTIONAL CASE OF SOUTH AFRICA -BASED ON CO-OPERATIVE STRUCTURE -STRENGTHENED BY SAFEX -STRONG CO-OPS FACILITATED CREATION OF SAFEX MOST COUNTRIES HAVE: - NON-NEGOTIABLE RECEIPTS - ISSUED BY INSPECTION COMPANIES AND PORT WAREHOUSES - LARGELY USED BY FOREIGN-OWNED COMPANIES

7. MODELS OF AGRICULTURAL WAREHOUSING - 1. THE REGULATED ELEVATOR COMPANY MODEL ELEVATORS STORE AND TRADE COMMODITY ISSUE WAREHOUSE RECEIPTS FOR OWN AND BORROWED COMMODITY FARMER GIVEN A VARIETY OFCONTRACTUAL ALTERNATIVES STRONG REGULATORY ARRANGEMENTS PERFORMANCE RISKS ARE UNDERWRITTEN EXAMPLES: USA, CANADA (+ SAFEX)

8. MODELS OF AGRICULTURAL WAREHOUSING - THE GENERAL WAREHOUSING MODEL WAREHOUSES ONLY PERFORM SERVICE FUNCTIONS HANDLE ALL SORTS OF MERCHANDISE OFTEN ENGAGE IN “FIELD-WAREHOUSING” MORE MODEST REGULATORY ARRANGEMENTS EXAMPLES: ALL LATIN AMERICAN COUNTRIES, HUNGARY, INDIA, (+ INTERNATIONAL INSPECTION COMPANIES)

9. MODELS OF AGRICULTURAL WAREHOUSING - THE PRIVATE TRADER MODEL UNREGULATED VERSION OF THE ELEVATOR- COMPANY MODEL EXAMPLE: CARGILL, KRASNODAR, RUSSIA

10. REGULATED ELEVATOR COMPANY MODEL INVOLVES EXISTING TRADING COMPANIES - MAX GEOGRAPHICAL COVERAGE PROMOTES COMPETITIVE MARKET SYSTEM MORE FINANCIALLY VIABLE MORE ATTENTION TO QUALITY AND GRADING GREATER NEGOTIABILITY OF WAREHOUSE RECEIPTS HEAVY OVERSIGHT REQUIRED - CAN THIS BE ORGANISED?

11. GENERAL WAREHOUSING MODEL - PROS AND CONS LOWER REGULATORY DEMANDS WORKS WITH FIELD- WAREHOUSES LESS DIRECT CONTACT WITH PRODUCERS LESS ATTENTION TO QUALITY AND GRADING

12. CAN WORK WITHOUT LEGAL OR REGULATORY FRAMEWORK FEW COMPANIES ELIGIBLE NO CHECKS AND BALANCES LITTLE INTEREST WHERE PROFITS ARE HIGH PRIVATE SECTOR MODEL - PROS AND CONS

13. HOW TO INSULATE A WAREHOUSE RECEIPT SYSTEM FROM POLITICAL PRESSURES ? OVERSIGHT BY PRIVATE SECTOR - CASE OF SAFEX OVERSIGHT BY STAKEHOLDER FORUM OVERSIGHT BY INTERNATIONALLY REPUTED BODY A REGIONAL SYSTEM OF OVERSIGHT BONDING COMPANIES PROVIDE QUALITY CONTROL BUT, DECISION NEEDS TO COME OUT OF GOVERNMENT

14. CONCLUSIONS AFRICA NEEDS RADICAL IMPROVEMENT IN GRAIN MARKETING SYSTEMS WAREHOUSE RECEIPTS ARE A KEY MEASURE CASH EXCHANGES CAN FOLLOW MERITS WHOLEHEARTED DONOR SUPPORT REGULATED ELEVATOR COMPANY PRACTICALLY & FINANCIALLY ADVANTAGEOUS NEED TO DESIGN A DEPOLITICISED SYSTEM