U.S. Ambassador visits ACE

By Frank Kadzakumanja

On 14th January, 2012, U.S. Ambassador to the UN Food and Agriculture Agencies in Rome, David Lane visited Agriculture Commodity Exchange for Africa (ACE) to learn more about ACE and its impact to the Agriculture sector in Malawi. Ambassador Lane was accompanied by Ambassador to Malawi, Janine Jackson and World Food Programme (WFP) officials. During the visit, Ambassador Lane had a chance to observe a Bid Volume Only (BVO) in session in which World food Programme (WFP) placed a bid to buy 1327 MT of maize. Also present were farmers, business community as well as representatives from Farmers Associations.

Speaking at the function, Principal Advisor for ACE, Kristian Schach Moller said that ACE is working hand in hand with farmers across Malawi to avoid losses made soon after harvest by enabling them to store grain in certified warehouses and sell at better prices later when the demand is low. He said that when famers deposit their grain, they also have access to a loan of up 70 % of their commodity value to offset immediate cash needs. "The facility is open to all and it is 100% transparent" .He said. Also speaking at the same function was World food Programe P4P Coordinator, Irene del Rio Huerta who said that World Food Programme (WFP) uses ACE because of the BVO element which produces more timely, accurate and usable data and that it gives smallholder farmers and traders direct access to commodity exchanges in a manner which is transparent and competitive. "When the session is done, WFP compares prices and transport costs, and then selects the most competitive offer or offers." She said. Farmers who have benefited from the system also took the time to explain their experiences. Speaking on behalf of the farmers, Mr Michael Banda, a farmer in Dowa said that he was very privileged to have been one of the first users of the system in Malawi. "Before I used to sell my commodity to vendors soon after harvest, but now with the coming of ACE I was able to deposit my maize and then I got a loan to build a house. When I wanted inputs I was also given fertilizer and seed using my receipt". He said.At the end of the meeting, Ambassador Lane hailed ACE for the positive impact of the warehouse receipt system in Malawi.

IMAG0174 Principal Advisor for ACE, Kristian Schach Moller explaining WRS value using a pie Chart                                                                                    

IMAG0175   A farmer, Mr Kanyenge explains his experience as Ambassador Lane looks on                                                                                      

Apart from Warehouse Receipt System (WRS), Agricultural Commodity Exchange for Africa (ACE) added a "Bid Volume Only" (BVO) component to its trading platform with the help of a USAID COMPETE partnership Fund grant. World food programme (WFP) started procuring through ACE in February 2010 and it has been a success. Among other things, Agricultural Commodity Exchange (ACE) also disseminates Market price information across 28 markets in Malawi to help farmers make informed decisions about when to sell or buy their commodities.