ACE Africa Taps Seasoned Expert Muona to Spearhead Growth and Drive Business Momentum in Malawi

Key Business Points

• Structured produce market consolidation is a key focus for the Agricultural Commodity Exchange (ACE) for Africa, with new managing director Prisca Muona at the helm, aiming to build more volumes within the warehouse receipt system (WRS).
• Aggregation is crucial for smallholder farmers to gain bargaining power, access better prices, and meet larger market demands, according to Muona, who emphasizes the importance of farmers coming together to achieve this goal, a concept known as "ukugwiritsa ntchito" in Chichewa.
• Addressing the finance gap between producers and off-takers is a critical challenge that Muona aims to tackle, recognizing that finance is a key driver of high volumes in the WRS, which can help farmers access better prices and improve their "mphasa" (profit).

The appointment of Prisca Muona as the new managing director of ACE for Africa is set to boost the structured produce market in Malawi. Muona’s primary focus will be on building more volumes within the WRS, a mechanism introduced in 2011 that allows farmers and traders to deposit agricultural commodities into certified warehouses and receive a negotiable receipt as proof of ownership. This system, primarily managed by ACE, enables farmers to store produce, avoid selling at low harvest-time prices, and use the receipt as collateral to secure bank loans, thereby improving their "zokolola" (savings).

According to Muona, aggregation is key when smallholder farmers come together, as it enables them to gain bargaining power, access better prices, and meet larger market demands. She notes that the main driver of high volumes is finance, and one of the critical challenges will be to address the gap between producers and off-takers. A recent study by the Centre for Agricultural Research and Development at Lilongwe University of Agriculture and Natural Resources found that many smallholder farmers shun structured markets in favor of quick cash sales due to limited aggregation of produce and inadequate information and infrastructure challenges.

ACE for Africa, a commodity exchange and warehouse receipt system operating in Malawi since 2006, has facilitated finance worth $22 million (about K38 billion) to small and medium enterprises for agricultural produce and has traded over 200 000 metric tonnes of commodities. With Muona at the helm, the exchange is poised to further support Malawi’s agricultural sector, which is a significant contributor to the country’s economy. By addressing the finance gap and promoting aggregation, ACE for Africa aims to empower smallholder farmers and improve their access to better prices and markets, ultimately contributing to Malawi’s economic growth and rural development.

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