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A study was conducted during 1994-1995 amongst policy makers, government officials, retailers and millers in Lesotho to review the maize marketing system and procedures for setting maize prices at producer, mill-gate and consumer levels. Set prices distort price signals which influence decisions to allocate and distribute resources to provide goods and services for markets. Lesotho is a net importer of maize grain, the major staple, implying that maize pricing and marketing policy affect food security. Results indicate flexible informal marketing channels, fixed formal marketing channels and declining real producer, mill-gate and consumer prices in recent years Falling real South African Maize Board export grain prices and evidence of subsidies to commercial Lesotho mills explain these price trends. Changes to the one channel formal marketing system and nationally administered price structure that would encourage an open market system with less restrictive interregional maize trade are recommended.


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