Improving Agricultural Market Performance:
Developing Agricultural Market Information Systems
107
commodity exchanges, among these being the limited capacity of the new exchanges to enforce
trade contracts (Sitko and Jayne, 2011). This simply means that the exchanges are unable to
ensure that sellers deliver against the trade contracts and that buyers honour payment
obligations. In an assessment of UCE in 2014, Onumah and Nakajjo (2014) concluded that the
latter problem can be fixed by setting up a credible clearing and settlement system involving at
least one of the major banks – which was demonstrably feasible. They stressed, however, that
the much more difficult challenge was in guaranteeing delivery of quality products in a country
where a reliable WRS is missing. As at the time of this study, this challenge remained and needs
to be addressed by private stakeholders and the Government of Uganda.As shown in Table 5, different forms of funding configurations are in place for MIS in Uganda.
This includes the totally government-funded Coffee MIS run by the UCDA and donor-funded
systems such as FEWSNET and theWFP’s platformwhich aims the monitor developments which
signal the risk of a food crisis either at national or specific community levels. In addition, there
are private MIS platforms which rely on internal-cross subsidisation from other commercial
activities undertaken by the providers such as commodity trading and provision of
advisory/consultancy services. The private providers, however, receive various levels of
critically needed supplementary from donors and the government. There is no single case in
Uganda where an MIS has achieved autonomous financial sustainability. It is apparent therefore
that sustainability remains a major challenge for most of the providers.No formal legislative or regulatory framework exists in Uganda for MIS, which has partly
contributed to the large number of providers who populate the MIS landscape in the country
without driving up uptake, especially among the key market players such as farmers, traders
and financial institutions. There is no apparent coordination among the providers and no
structural responsibility for validating the quality if information disseminated and ensuring it is
aligned to the needs of market players. Though none of the stakeholders consulted advocated
for such an enabling regulatory framework, it may be worthwhile for Uganda to learn from
Indonesia and institute a working platform which rationalises investment in MIS capacity in
order to ensure delivery of reliable information which meets the needs of the target audience.It also appears important in promoting effectively utilised MIS as well as overall development
of agricultural marketing systems in Uganda that Government avoids policy actions which
discourage transparent engagement in market transactions. For example, Government policy
objective of encouraging domestic value addition is perceived by stakeholder to be against the
export of maize grains rather than maize flour into regional markets. The unintended
consequence of the policy, therefore, appears to include restricting transparent formal exports
but rather boosting informal cross-border trade in maize grains. One of the effects is under-
reporting of the flows as well as price incentives for maize grain exports.A similar appears to have emerged in the sorghum subsector, where Government policy aims to
protect domestic producers and restrict imports from regional suppliers. The anecdotal
evidence obtained during the consultations with stakeholders in the course of this study indicate
that this action is only encouraging under-reporting of the volumes of cross-border trade in
sorghum and may be misrepresenting the overall state of the trade.