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Enhancing the Provision of Livestock Marketing Information in Somaliland

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Enhancing the Provision of Livestock Marketing Information in Somaliland ISBN 92–9146–383–3 ILRI RESEARCH REPORT Enhancing the provision RESEARCH PROGRAM ON The International Livestock Research Institute (ILRI) works to improve food security and reduce of livestock marketing poverty in developing countries through research for better and more sustainable use of livestock. Policies, ILRI is a member of the CGIAR Consortium, a global research partnership of 15 centres working with many partners for a food-secure future. ILRI has two main campuses in East Africa and other Institutions information in Somaliland hubs in East, West and southern Africa and South, Southeast and East Asia. ilri.org and Markets CGIAR is a global agricultural research partnership for a food-secure future. Its science is carried out by 15 research centres that are members of the CGIAR Consortium in collaboration with hundreds of partner organizations. cgiar.org 35 Danida Chamber of Commerce, Industries and Agriculture, Hargeisa, Somaliland Terra Nuova Enhancing the provision of livestock marketing information in Somaliland Lawrence M. Godiah,1 Derek Baker,2 Ibrahim Ismail Elmi,3 Riccardo Costagli,1 Ibrahim Gulaid1 and Francis Wanyoike 4 1. Terra Nuova Eastern Africa, Nairobi, Kenya 2. University of New England, Armidale, Australia 3. Somaliland Chamber of Commerce, Industries and Agriculture, Hargeisa, Somaliland 4. International Livestock Research Institute, Nairobi, Kenya December 2014 © 2014 International Livestock Research Institute (ILRI) This publication is copyrighted by the International Livestock Research Institute (ILRI). It is licensed for use under the Creative Commons Attribution-Noncommercial-Share Alike 3.0 Unported Licence. To view this licence, visit http:// creativecommons.org/licenses/by-nc-sa/3.0/. Unless otherwise noted, you are free to copy, duplicate or reproduce, and distribute, display, or transmit any part of this publication or portions thereof without permission, and to make translations, adaptations, or other derivative works under the following conditions: ATTRIBUTION. The work must be attributed, but not in any way that suggests endorsement by ILRI or the author(s). NON-COMMERCIAL. This work may not be used for commercial purposes. SHARE ALIKE. If this work is altered, transformed, or built upon, the resulting work must be distributed only under the same or similar licence to this one. NOTICE: For any reuse or distribution, the licence terms of this work must be made clear to others. Any of the above conditions can be waived if permission is obtained from the copyright holder. Nothing in this licence impairs or restricts the author’s moral rights. Fair dealing and other rights are in no way affected by the above. The parts used must not misrepresent the meaning of the publication. ILRI would appreciate being sent a copy of any materials in which text, photos etc. have been used. Editing, design and layout—ILRI Editorial and Publishing Services, Addis Ababa, Ethiopia. Cover photo—ILRI/Peter Ballantyne ISBN 92–9146–383–3 Citation: Godiah, L.M., Baker, D., Elmi, I.I., Costagli, R., Gulaid, I. and Wanyoike, F. 2014. Enhancing the provision of livestock marketing information in Somaliland. ILRI Research Report 35. Nairobi, Kenya: International Livestock Research Institute. ilri.org Better lives through livestock ILRI is a member of the CGIAR Consortium Box 30709, Nairobi 00100, Kenya Box 5689, Addis Ababa, Ethiopia Phone: + 254 20 422 3000 Phone: +251 11 617 2000 Fax: +254 20 422 3001 Fax: +251 11 617 2001 Email: [email protected] Email: [email protected] Enhancing the provision of livestock marketing information in Somaliland iii Contents Tables iv Figures v Acknowledgements vi Abstract 1 Introduction 2 Background information 2 Features of Somaliland’s livestock export trade 4 The Livestock Market Information System (LMIS) in Somaliland 4 The LMIS data collection protocol 5 Purpose, objectives and research questions 6 Methodology 8 Data 8 Identifying the components of time series data 8 Using regression models to analyse price trend 9 Results and discussion 11 Proportion of exports captured by the LMIS 11 Trends in traded volumes 12 Conclusions and recommendations 28 References 31 iv Enhancing the provision of livestock marketing information in Somaliland Tables Table 1. Trends in volumes of export-quality livestock traded in Hargeisa, Burao and Tog Wajaale markets versus total export volumes 11 Table 2. Changes in prices of sheep and goats in Burao and Hargeisa markets (2008–12) 19 Table 3. Changes in cattle prices in Tog Wajaale market (2008–12) 19 Table 4. Changes in camel prices in Burao, Hargeisa and Tog Wajaale markets (2009–12) 21 Table 5. Trends in the proportion of livestock exported to different destinations 22 Table 6. Results of Phillips-Peron test for non-stationarity of monthly mean price of export quality livestock in Somaliland 23 Table 7. Variables used in the regression analysis 23 Table 8. Trends and market price determinants for small ruminants and camels in Somaliland 24 Table 9. Trends and market price determinants for cattle in Somaliland 25 Table 10. Determinants of price trend for different grades of small ruminants in Somaliland 26 Enhancing the provision of livestock marketing information in Somaliland v Figures Figure 1. Trends in livestock FoB volumes from Berbera Port, Somaliland. 2 Figure 2. Trends of live animal exports from Australia (2007–12). 4 Figure 3. Monthly traded volumes of small ruminants in Burao and Hargeisa markets (2007–12). 12 Figure 4. Three-month moving average of traded volumes of small ruminants in Burao and Hargeisa markets (2007–12). 12 Figure 5. Monthly traded volumes of cattle in Tog Wajaale market (2007–12). 13 Figure 6. Three-month moving average of traded volumes of cattle in Tog Wajaale market (2007–12). 14 Figure 7. Monthly traded volumes of camels in Burao, Hargeisa and Tog Wajaale markets (2008–12). 15 Figure 8. Three-month moving average of camels traded in Burao, Hargeisa and Tog Wajaale markets (2008–12). 15 Figure 9. Monthly totals of export traders active in the study markets on Mondays and Thursdays (2007–12). 16 Figure 10. Mean monthly prices of small ruminants in Burao market (2007–12). 17 Figure 11. Three-month moving average prices of small ruminants in Burao market, (2007–12). 17 Figure 12. Mean monthly prices of small ruminants in Hargeisa market (2007–12). 18 Figure 13. Three-month moving average prices of small ruminants in Hargeisa market (2007–12). 18 Figure 14. Mean monthly cattle prices in Tog Wajaale market (2007–12). 20 Figure 15. Three-month moving average cattle prices in Tog Wajaale market (2007–12). 20 Figure 16. Mean monthly camel prices in Burao, Hargeisa and Tog Wajaale markets (2008–12). 21 Figure 17. Three-month moving average camel prices in Burao, Hargeisa and Tog Wajaale markets (2008–12). 22 vi Enhancing the provision of livestock marketing information in Somaliland Acknowledgements This report is a product of a collaborative effort between the International Livestock Research Institute (ILRI), Terra Nuova and the Somaliland Chamber of Commerce, Industries and Agriculture (SLCCIA). The effort of various Somaliland organizations in supporting the SLCCIA to ensure continuous and smooth running of the Livestock Marketing Information System (LMIS) is appreciated. These organizations include the Ministry of Livestock, Ministry of Commerce, Ministry of Finance, the Berbera Ports Authority and the Municipalities of Hargeisa, Burao and Tog Wajaale. Special thanks go to the data collection teams in each market comprising of brokers, price collectors and municipality clerks and also to the data collector at the Port of Berbera. The effort of the SLCCIA LMIS Data Management team comprising of Mohamed Ibrahim Hussein and Mohamed Abdullahi Dirie in ensuring the data are cleaned and well stored is appreciated. We acknowledge and are grateful to the Danish government for funding this study. Disclaimer The contents of this report are the sole responsibility of Terra Nuova and ILRI and can under no circumstances be regarded as reflecting the position of the Danish government. Enhancing the provision of livestock marketing information in Somaliland 1 Abstract The economy of Somaliland depends on livestock, which employs about 70% of the population and contributes approximately 60% of GDP and 85% of export earnings. The principal export markets are the Kingdom of Saudi Arabia, Yemen, Oman, Egypt and the United Arab Emirates. Exports to these markets have shown a steady growth in the last four years. Despite recent growth in export volumes, livestock trade takes place in an environment characterized by an underdeveloped legal framework, contract uncertainty and high information costs among other factors. Trade is guided by informal traditional institutions, customs and religious practices that serve as alternatives to formal contracting. The Livestock Marketing Information System (LMIS) was initiated in 2007 to address the constraint of high market information cost. The purpose of the LMIS is to provide timely current information to livestock producers, traders, government officials and other development partners. It collects and disseminates data from three livestock markets (Hargeisa, Burao and Tog Wajaale), the port of Berbera and crossborder market of Lowya Caddo. It is implemented by the Somaliland Chamber of Commerce, Industries and Agriculture, in collaboration with the Ministry of Livestock, Ministry of Commerce, Ministry of Finance, the municipalities of Hargeisa, Burao and Tog Wajaale, with the technical
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