Full Length Research Paper

Price risk management strategies in corn marketing in rural Mozambique

César Benites Mário Zidora1, Cleyzer Adrian da Cunha2, Alcido Elenor Wander3* and Odilon José de Oliveira Neto4


This study aims at analysing the hedging strategy in the marketing of maize grain in the rural areas of Mozambique. The farmers living in the rural areas of Mozambique that engaged in the business of cultivation, production and marketing of corn as their main rural activity and a means of ensuring subsistence were identified as the target group. The surveyed communities are located in three provinces of Mozambique, they are: Maputo, Gaza and Manica. Questionnaires with key questions relating to the central objective of the work were designed and distributed for data collection to farmers totalling 107 in number, cutting across the three provinces of consideration. A qualitative and quantitative approach that is both exploratory and descriptive in nature was used in the research. In addition to the primary data obtained through the questionnaires, secondary sources of information such as thesis, dissertations, and scientific articles relating to the focus of this study were harnessed. Results from the research showed that marketing plays a leading role in the social life and welfare of the Mozambicans. Majority of the producers claimed to use no risk management strategy in marketing due to lack of information and thus, becoming vulnerable to prices from the buyers. While a small number gave credence to long term experience in the production and marketing business, and have adopted certain strategies for managing price risk, such as the use of fixed-term contracts, most of them being informal agreements and sometimes not compensatory to price risk in the management context. Among other socioeconomic variables that had statistically significant effect on influencing the choice and use of hedging strategy to manage price risk in the marketing of corn, are: schooling, production time, membership in a cooperative and satisfaction financial return.

Key words: Corn marketing, hedging strategies, and farmers. JEL Codes: D40, D47, O13.

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