The price of maize

What does maize cost in Ghana today?

That’s a useful question to ask if you’re a farmer in Burkina Faso, wondering if it’s worth selling your harvest locally, or whether you might invest in a lorry to take your grain south, where it might fetch a higher price. The TradeNet system built at the BusyLabs technology incubator in Accra makes it possible to find up-to-date prices on agricultural products throughout West Africa, and to offer transactions to users in other countries, selling commodities across national borders. The aim of systems like this one is to increase regional trade, which will benefit local farmers and should help decrease food emergencies, which tend to be highly local and can often be corrected by bringing food from other parts of a country or region into the affected area.

White maize is selling for $0.32 a kilo in Ghana today, and for $0.22 across the border in Burkina Faso, a disparity that might be explained by Ghana’s comparative wealth and spending power. But if you’re looking to engage in agricultural arbitrage, you might want to go long in onions, which are selling for $0.31 a kilo in Benin and $0.91 a kilo in Ghana. Of course, before you load that lorry, you should probably do some research. One of the reasons that commodity prices are so varied in the region is that regional trade is tough to accomplish – the infrastructure connecting Ghana and Benin isn’t great, so transport costs are high, and the process of crossing borders between Ghana/Togo and Togo/Benin is likely to involve tarrifs, shrinkage of your crops and a number of other unanticipated costs.

Still, the ability to triple your money by shipping onions 300km looks like a great commerical opportunity for a knowledgeable entrepreneur. It’s an opportunity that’s only available if the information is accurate, timely and available, which is why the TradeNet system is so interesting.

What will maize cost in Ghana in a few weeks?

That’s a harder question to answer, but one that’s on the mind of NASA scientist Molly Brown. She’s building a system that sythesizes information from the NDVI – Normalized Difference Vegetation Index – a map of how green or brown vegetation is in various different parts of the globe – with rainfall and humidity information to offer forecasts of market prices for various commodities. Brown hopes to make these maps available for West Africa in 2008 and in other parts of the world in 2010.

The value of these maps is that they can predict localized famines, which might be alleviated by using data from a system like TradeNet, allowing millet from Mali to be moved to Niger to feed hungry populations in areas where crops have failed. It’s possible to build these maps because there’s generally so little mobility in African markets – in rural areas, most grain is sold within a few dozen kilometers of where it’s produced. As Brown explained to Science Central, building maps like this for the US doesn’t make much sense, as we’re already used to buying strawberries from California, Guatemala, or wherever they’re cheapest. But having information both on future agricultural production and current agricultural pricing could have a huge impact on food security in West Africa… so long as questions of transport infrastructure and cross-border trade can be worked out as well.

I’m always interested in what leads scientists to study a particular problem – it’s my firm belief that lousy problem selection is why we’ve got four thousand competing online social network projects and so few regional agricultural trade networks. It comes as no surprise to find that Brown was a Peace Corps volunteer in Senegal… there’s nothing like seeing these problems first hand to make you want to focus your research on projects that have a high probability of solving realworld problems.