EXISTING SITUATION

The MARKETS

Cattle Markets in Tanzania do not use the auction system - they operate using a system of private deals, where sellers turn up with their cattle and stand around while buyers and potential buyers move from seller to seller, negotiating and making deals.

This, especially in the absence of a good Market Information System, will probably lead to a greater variability in price than would be the case with an auction system.

Note also that with an auction system, it is relatively easy for any observer to quickly build a picture of prices and values; with a private-deal system, however, there is much less transparency, and thus some kind of Market Information System is much more necessary.

Much of the selling in Arusha and Moshi is done by the Masai; much of the buying in all 3 markets is done by Islamics, Arabs and/or Somalis. Everything is done using cash, in Tanzanian Shillings as far as can be determined; sometimes deals are done on a credit basis, when buyer and seller are known to each other, and cattle are handed over today on a promise of cash in 7 days time or less.

There is a reasonable level of provision of food, drink and other goods at all 3 markets, especially at Themi. This is done by private traders, who as far as I could determine were not levied for being at the market.

All of the markets had no electricity or human sanitation. All had primitive slaughter slabs which were used from time to time. All 3 had a single weighing scales (spring balance type) with cattle crushes, and some cattle pens. Dar had a fence around the market area, but neither Themi nor Weruweru had any fence.

There is a distinct lack of infrastructure at markets regarding drinking water and fodder for cattle; therefore there is distinct pressure on sellers to sell their cattle if possible on the same or next day as the cattle arrive at the market. This arrival can also of course come at the end of a gruelling trek or a gruelling rail trip with little or no water or food in either case.

Another infrastructural consideration is that there is little or zero provision within Tanzania for the cold storage or frozen storage of beef - i.e. most beef is sold within a short time period of being slaughtered.

Furthermore, there are few or no urban feedlots for the fattening or holding of cattle before slaughter.

Thus there are few factors to cushion supply and demand for beef.

The overall result of these factors is that, especially in a large urban market such as Dar, there can be a high variability in the wholesale price of cattle from day to day, depending on the arrivals situation.

For the record, the Dar Pugu market depends almost totally on arrivals by rail, and operates effectively 7 days a week; the Themi Arusha market operates only on Fridays, and the Weruweru Moshi market operates only on Tuesdays. Approximate volumes are 400/day (2800 per week) for Dar, 350 /week for Moshi and 600/week for Arusha, but seasonal variations are sizeable. See graphs later for information.

All 3 markets are at the moment run by the Ministry of Agriculture. There is a levy of approximately US$ 1.00 per animal sold (regardless of sex, weight, or grade), or a movement fee of approximately US$ 0.15 per head for animals which are unsold. Because of this situation, there is some temptation for the number sold to be understated by the records (see more discussion below); however, because the tax or fee is independent of animal price, weight or grade, then at least there is no temptation to distort declaration of those values. This sales levy amounts on average to about 1% of animal value (with an average animal value of US$ 100-00).

The ledger record-keeping system at the 3 markets vary slightly, with Dar having the best system. See the appendix on market visits for details.

The slaughter fee at Government or private abattoirs is in the region of US$ 1-00 per animal, or about US$ 0.01 per kg of edible meat.

It must be emphasised that pricing of wholesale live cattle is a complex business, far removed from the much simpler business of crop pricing for most crops, where there may be a few grades and qualities - for cattle there are 3 sexes (steers, cows and bulls), 5 grades in the current Tanzanian system, and a range of liveweights from probably 160 kg through 350 kg.. The previous 2 systems produced average prices per kg liveweight for each of the 3 sexes and each of the 5 grades, i.e. for 15 Grade-Sex Combinations (GSC's).