BY BY EMMANUEL ABOKYI GIMPA/IFPRI E-mail: eabokyi@yahoo.

com Tel: + 233 244 561 695

OUTLINE OF PRESENTATION
The rationale for the programme The concept, structure and operations of the programme Key outcomes of the programme Sustainability of the programme Policy options

RATIONALE OF THE PROGRAMME

Ghanas agricultural policy of adopting value chain approach in the agricultural sector Lack of efficient produce markets for small holder farmers The 2008 world food price crisis, food security preparedness and the continues pressure on Government to control the high prices of food Anticipated increases in cereals as a result of the implementation of other programmes by the Ministry of Food and Agriculture, these are:

Rationale continues
The introduction of Block Farms Program which has made it possible for mechanization and extension services to be spread out to cover a large acreage and a large number of farmers. Increased subsidization of fertilizers and improved seeds. The injection of more tractors and other farm machinery and equipment at subsidized prices for increased mechanization.

Objectives of the programme

To guarantee farmers an assured income by providing a minimum guaranteed price and ready market To mop up excess produce from all farmers in order to reduce post harvest losses resulting from spoilage due to poor storage, thereby protecting farm incomes To purchase, sell, preserve and distribute food stuff To employ a buffer stock mechanism to ensure stability in demand and supply

Objectives continue
To expand the demand for food grown in Ghana by selling to state institutions such as the military, schools, hospitals, prisons, etc To manage governments emergency food security To facilitate the export of excess stock

Log frame
Inputs What NAFCO Invest Money Equipment Stock (Food inventory) Technology Equipment
Outputs Participatio Activities n What NAFCO does Buy produc ts from farmers Store produc t Who NAFCO Reach HHs Institut ions Schools Prisons Private farmers

Outcomes -- Impact
Short Short Term Results of NAFCO Interventions Stabilize Prices of food produce Stabilize food grain supplies Increase in acreage Medium Medium Term Results Create Employm ent Incentive to farmers Supply of raw materials Technolo gy adoption Long Long Term Improve emergency food reserves Stable supply of raw material for agro processing industries Jobs creation

CONCEPT, STRUCTURE AND OPERATIONS

Started operations in 2010 Buffer stocks for price stabilization and emergency food security (maize and rice now, soybean planned) Limited Liability Company, with initial GHS 15 million from government Currently operating in 5 regions with plans to expand nationwide; using LBCs to do purchases

Operations Continue
Price setting: floor price via post-harvest committee (crop budget plus 15% margin); ceiling price by NAFCO based on market trends) 34,000 MT capacity warehousing (transferred from government and rent) MOFA staff for supervision of regional warehouses

Key outcomes of the programme

Based on price trends, more stable prices
Maize: wholesale regional (Brong-Ahafo and Northern) and national Rice: wholesale regional (Northern)

Caveat:
NAFCO share in national market less than 5% Increased supply from other interventions (e.g. fertilizer)

Achievement continues
Employment generation and private-sector development, reported 52 LBCs and 800 agents on commission basis (maize: GHS 8 per 100 kg bag for transport and handling and margin) At least 3 women groups and 5,000 women in Northern region in parboiling (GHS 216 per month for 8 months) Rejuvenated NASIA rice milling (35 permanent employees) Positive financial viability in the short run (IRR 38%) Viable with cost increase by 10%; Not viable with revenue decrease 10%

Consumer surplus of 30%( for the lean periods)

SUSTAINABILITY OF THE PROGRAMME

Ministry of Food and Agriculture in 2010 gave GHS15 million ($10 million) for the set up and operations of NAFCO which is estimate at 7% of expenditure on agriculture NAFCO has been working with this amount since Witt positive financial viability in the short run

(IRR 38%)
The programme is sustainable

POLICY OPTIONS
Transparent information system about NAFCO prices and identification of LBCs Strengthen capacity in warehousing system and logistics Improving management and operational efficiency (e.g. link to regional market and information system) and quality control (measurements and standards)

Thank you