Tanzania: Re-Imagining Brokerage Services Vital in Agric Modernization

IF there is a blind spot among many Tanzanians is the old thinking that agriculture as the activity that revolves around tilting, sowing and reaping the crops, and that the most important sector has little to do with how that products reaches a consumer in the appropriate quantity, shape and time.

The word broker in many circles of businesspeople, politicians and even farmers themselves, is usually equated to crooked, uncultured and unruly kind of people who are out there waiting to ‘eat without sweet’. Consequently, this has resulted into shunning these ‘dalalis’ and not even trying to be associated with them.

These people have huge importance in pulling the chain that is usually underestimated by many, unfortunately even by policy makers. Make no mistake; this is in no way trying to sanitise the untoward behaviour of many of these business enablers.

They have been highly involved in theft, collusion, misleading players, among others. One major thing that can be closely observed even by a newcomer in the industry is that major markets are tightly controlled by these middlemen. They managed to create an invisible network to the extent that buyers cannot reach sellers in a natural way without their consent.

This is one among the acts that really hampers the sanctity of agribusiness in the country. A farmer of banana from Morogoro or Kagera that managed to organise a truck may not be able to sell the consignment at Mabibo territorial market because of the impenetrable fence created by the market’s leviathans.

Or if managed to sneak in, he will receive a relatively lower price than which is being offered by the market. For a supplier to easily navigate through this thick forest of ‘dalalis’, has to agree to ‘toe the line’ put in place by them or else no meaningful business will be realised. And this is common in all value chains.

So there is no way this will be accepted as a new normal, malicious interventions have to be taken by people of good conscience to improve the situation. However, that is just one part of the story, the contribution that these business enablers are bringing to the sector is just immense.

At the end of this essay, you will come into a full realisation that their above mentioned defects can be properly rectified without harming the many positive aspects of them. Dalalis – as they are popularly known in the local settings – are principal connectors of two sides which are far apart and relatively unknown to each other.

These valiant men and women do invest much of their financial and time resources to create lasting relationships with these major players in the market. They collect information on regular basis to make sure that a soybeans farmer in Songea is properly advised that Rwanda market offers better price of the same that Dar market. They say information is power.

This is so true when it comes to agribusiness. It was information relayed to European superpowers on spices availability in Indonesia and India in the 15th century that made those crops’ price appreciate in the global scale and which led to birth of cloves production in Zanzibar and other types of spices – today money generated from the sector is responsible to a better livelihood of hundreds of thousands of Tanzanians. Brokers are simply heralds of information that neither side can easily capture.

Much as we have been at the forefront to emphasise farmers and traders to make sure that they collect enough information for them to thrive, it is critical that their excellence on this cannot be matched by those who devote much of their time doing just that. As a result they managed to collect enough experience to predict the unforeseen outcome on any business dealings.

We further tell players to make use of Information and Communication Technology (ICT) by visiting a number of sites to collect a variety of information and many of them real time. But what we misunderstand is that these sites are also run by companies or groups of people who perform brokerage services regardless of names they carry with them.

They invest a lot to create relationships which eventually gives birth to trust which is a bedrock of any meaningful and sustainable business. For those who decry their presence and wishes for their total removal just because of their tendency to collude and influence prices, are deniers of the fact that even major companies are highly active in using their dominance to influence market behaviour, and that is why Fair Competition Commission (FCC) is in place to bring order in the business operations, and they have never been prohibited from clearing the cloud around the brokers.

Tanzanian brokers mobilise funds, collect crops in season, and sell them when prices are favourable. All these are necessary aspects for any value chain to thrive and they can hardly be done by farmers or traders alone. And in case you don’t know they exist even in developed economies. They have that sprawled.


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