Structure, Conduct and Performance of Grain Trading in Tigray and its Impact on Demand for Commodity Exchange: The Case Maychew, Mokone, Alemata, Mekelle and Himora

Abstract

Grain markets of Alemata, Maychew, Mokone, Mekelle and Himora are observed to operate in highly inefficient market structure, with very low level of trust at meso and macro level. As result the marking system is less developed and less efficient in terms of creating space and time utility. In which lack of finance is the most critical problem. Under such reality warehouse receipt system with receipts that can be used as collateral for loan are critical first stage needed to get the market right. If ECX’s exchange service has to be introduced it has to be low cost and low value added service, if not it may not find significant demand among grain traders.

Keywords: Ethiopian commodity exchange, social capital, networks, market development, warehouse receipt system