FRA should stick to buying strategic reserves – CUTS

Consumer Unity and Trust Society (CUTS) Zambia has recommended that the Food Reserve Agency should stick to buying maize for strategic reserves.

Speaking during a media breakfast this morning, CUTS Research Consultant, Natasha Chilundika says this will help reduce the fiscal strain the FRA puts on the treasury.

Ms. Chilundika has further recommended that government should consider using a price band to help signal when government would be expected to start buying in the market beyond the strategic reserve and when they are likely to start selling.

She says the price band can help reduce distortionary effects of government interventions on the agriculture market.

Ms. Chilundika says according to a study undertaken by CUTS dubbed leveraging regional policy successes to improve interventions by the FRA and the performance of Maize Markets in Zambia, the price band has worked well in Kenya with regards to reducing maize prices.

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