December 28, 2011 4:17 pm

Researchers from CIRAD and Wageningen UR give an overview of the different modalities and challenges in Market Information Systems. See: ESFIM Market Information Policy Brief

Agriculture Market Information Systems (MIS) collect, process and disseminate information on the situation and the dynamics of agricultural markets in order i) to improve public policies through increased awareness of market realities and ii) to increase market transparency and, by this way, to lead to a fairer and more efficient allocation of resources.

MIS information can be used by farmers both for advocating for more producer-friendly policies (through farmers’ organization) and to guide their production and marketing decisions (choice of what, when and where to sell). In addition, as small farmers’ market power is hindered by their lack of information on price levels and changes at different points of the marketing chain, strengthening smallholder farmers’ access to information can improve farmers bargaining position.

Market Information Systems (MIS) started to be promoted in developing countries in the 1980s, after market liberalization and the withdrawal of parastatal agencies from agricultural sector. These first generation MIS were almost all based on a similar model, regardless of the type of product and the country concerned: only one type of product was covered (cereals, cattle…), exclusive focus on prices, nation-wide coverage, dissemination through radio broadcasts, partnership with public institutions (marketing boards, agricultural ministries, etc.) and project-based funding. By the end of 1990’s, a second generation of MIS came up, mainly as a result of the emergence of ICT (cell-phones and Internet). These new technologies have brought about organizational innovations: dissemination through SMS messaging, for example, helped develop user-paid information services, opening a new market for private companies. As a result, today there is a great diversity of models among the second generation of MIS.

If these different models offer different opportunities for farmers, they also entail the risks of excluding some of them. The objective of this brief is precisely to help farmers to identify the different advantages and drawbacks of the different MIS models.

 By the end of 1990s, the emergence of cell-phones and the spread of the Internet offered huge opportunities. Before, transmission of price data from the collection point to the central unit, could take several days. Nowadays, “real time” information can be delivered within a few hours.

A fundamental change is the possibility of interactivity offered by the Internet or cell-phones: instead of “push” systems, where a package of standard information is disseminated to all the users, “pull” systems can be developed, where each user can choose the information he or she needs from a wide array (either by single requests or by individualized subscription systems). This enabled expanding the categories of products as well as taking into account different quality standards. Data is no longer limited to prices, but includes other information related to markets (local trade flows, imports/exports, contacts of buyers or sellers), production (weather, technical advice) or policy measures (standards, regulations). Through individual bids and offers, real transaction opportunities and buyers/sellers contacts can be transmitted. Moreover, this interactivity enables MIS managers to follow-up which information is used (by tracking user-selected information through the number of requests sent to the MIS or the number of downloads) and then to adjust the service provided to fit the users’ needs.

The surge of mobile phone usage has attracted private entrepreneurs who have set up market information services such as Esoko/TradeNet or Manobi. In addition, national farmers’ organizations have expanded their scope from production issues to marketing issues, and have become involved in MIS as well, often with project support.

Beyond market information, second generation MIS are in some cases associated with complementary services that reduce market risks through storage facilities and credit, warehouse receipt systems, commodity exchanges. In addition, they seek to contribute to productivity enhancement through improved input access or technical training.

See pdf for ‘Lessons Learnt’ and several cse-descriptions: ESFIM Market Information Policy Brief