Traditional markets for poverty reduction and food security: exploring policy options in Honduras and Nicaragua.

Abstract

Results are presented from a study that examined the traditional market channels for agricultural goods in Honduras and Nicaragua in order to identify policy options to increase the value that these markets offer to small producers and poor consumers. The study examined the existing rural-urban linkages between small producers and other low-income actors through a representative food basket including red bean as an index for basic grain crops, plum tomato representing vegetables, and dry/semi-dry cheese as a representation of animal protein. In both Honduras and Nicaragua, traditional markets (i.e., wholesalers, retailers, and farmers' markets) play a major role in the distribution of agricultural products to the consumer, especially for those consumers with limited purchasing power. The competitiveness of businesses in traditional markets for basic grains, vegetables, and cheeses in Honduras and Nicaragua is negatively affected by poor food safety, post-harvest losses, seasonal price fluctuations, and a reduction of sales. These factors lead to a contraction in demand and may force poor consumers to purchase their goods in more expensive markets, thereby reducing their food security. It is suggested that public policies on health and safety regulations in traditional markets should be introduced or reinforced to improve product quality and food safety, and to stimulate efficient production, processing, sorting, transport, and storage practices, while taking into account the different needs of each group of value chain actors linked to the traditional markets of Honduras and Nicaragua.