Market segmentation in Ghanaian white maize.
White maize cleared wholesale at GH¢3.32/kg in Gushegu and GH¢7.52/kg in Accra in March 2024. Haulage between the two accounts for a fraction of that spread. The markets are held apart by aggregation cost, working capital and the absence of a contract that settles at source, not by freight.
Basis
2023–24 wholesale archive; dated values, not current prices. White maize (grain), wholesale, 100 kg standard trade unit, GH¢/kg, monthly median, fixed basket. Conventions: Methodology, Symbology.
The observation
White maize of one specification clears at a different wholesale level in each market the archive records. Figure 1 opens on March 2024; the control steps through every month on record.
The interactive figure needs JavaScript. The March 2024 numbers are in the table below.
The spread exceeds the cost of moving the grain. In March 2024 Gushegu cleared at GH¢3.32/kg and Accra at GH¢7.52/kg. Figure 2 sets that gap against the cost of haulage.
Birkdal Partners wholesale archive (v2). Monthly median of wholesale submissions; repeated entries removed.
Show the numbers
| Market | Region | Zone | Median GH¢/kg | Interquartile range | Obs. |
|---|---|---|---|---|---|
| Gushegu | Northern | Northern supply zone | 3.32 | 3.32–3.32 | 5 |
| Bolgatanga | Upper East | Northern supply zone | 3.90 | 3.90–3.90 | 7 |
| Salaga | Northern | Northern supply zone | 4.40 | 4.37–4.52 | 3 thin |
| Wa | Upper West | Northern supply zone | 5.04 | 5.04–5.04 | 2 thin |
| Bawku | Upper East | Northern supply zone | 5.40 | 5.10–5.50 | 12 |
| Jirapa | Upper West | Northern supply zone | 6.00 | 6.00–6.00 | 3 thin |
| Kintampo | Bono East | Middle-belt trading towns | 3.61 | 3.30–3.62 | 3 thin |
| Techiman | Bono East | Middle-belt trading towns | 3.70 | 3.70–4.07 | 5 |
| Wenchi | Bono | Middle-belt trading towns | 4.00 | 3.95–4.05 | 4 thin |
| Nkoranza | Bono East | Middle-belt trading towns | 4.65 | 4.58–4.72 | 2 thin |
| Unidentified market, Volta | Volta | Southern demand centres | 6.06 | 6.05–6.07 | 2 thin |
| Kumasi | Ashanti | Southern demand centres | 6.90 | 6.85–7.00 | 20 |
| Accra (Nima) | Greater Accra | Southern demand centres | 7.52 | 7.52–7.53 | 5 |
Persistence
A single month does not establish structure. The test the archive supports is the Gushegu–Kumasi pair, with market, commodity and unit held fixed. The pair reports together in four months. Gushegu clears below Kumasi in all four, at ratios of 1.46× to 2.34×. The magnitude moves with the season; the direction does not.
| Month | Gushegu GH¢/kg | Kumasi GH¢/kg | Ratio |
|---|---|---|---|
| Aug 2023 | 5.20 | 7.60 | 1.46× |
| Nov 2023 | 2.77 | 6.49 | 2.34× |
| Dec 2023 | 3.60 | 6.50 | 1.81× |
| Mar 2024 | 3.32 | 6.90 | 2.08× |
Figure 1 shows every market reporting white maize in each month on record, with thin months drawn hollow. Three of the four Gushegu months in the table hold fewer than five observations. Other north–south pairs in the archive do not hold the same ordering in every month.
Freight is not the binding constraint
In an integrated market, inter-market spreads settle near the cost of moving goods between them. These do not. The larger part of the gap is not freight.
- Haulage
- Not explained by freight
The chart needs JavaScript. The numbers are in the table below.
The remainder is not split. It reflects:
- aggregation cost;
- working capital;
- quality and settlement risk.
Haulage at GH¢1.00 per tonne-kilometre over roughly 700 km and 500 km, the planning figures used in RN 002. Medians from the Birkdal Partners wholesale archive (v2).
Show the numbers
| Route | Price gap | Haulage as assumed | Not explained | Haulage at twice the rate | Not explained |
|---|---|---|---|---|---|
| Gushegu to Accra | 4.20 | 0.70 (17%) | 3.50 (83%) | 1.40 (33%) | 2.80 (67%) |
| Gushegu to Kumasi | 3.58 | 0.50 (14%) | 3.08 (86%) | 1.00 (28%) | 2.58 (72%) |
GH¢ per kg. Medians, March 2024: Gushegu 3.32 (5 prices), Accra (Nima) 7.52 (5), Kumasi 6.90 (20).
The constraints that segment the market
In Birkdal's assessment, three conditions hold the markets apart:
- Aggregation cost. Northern markets clear small lots to local buyers. Assembling a truckload moves the local price against the buyer, and the cost of assembly, grading and bagging falls on the first mover.
- Working capital. Aggregators at the point of surplus are short of finance, so grain is sold at harvest rather than carried. RN 003 prices this: at Ghanaian commercial rates, five months of carry consumes roughly two-thirds of a normal seasonal move.
- Quality and settlement risk. Without a grade verified at source and a counterparty that settles on delivery, a southern buyer discounts northern grain for moisture, aflatoxin and non-delivery, and pays a premium for supply it can inspect.
Information is not among them. The grower selling at GH¢3.32 is generally aware that maize is dearer in Accra. Better information improves the terms of the negotiation at the farm gate; it does not move the grain.
Incidence
- The northern grower
- Sells at harvest into the local low, to the buyer who reached the farm, without storage or an alternative outlet.
- The southern buyer
- Pays the lean-season price, from an aggregation network it cannot audit, at a moisture content established at its own intake.
- The aggregator
- Identifies the spread and cannot finance its capture.
- The lender
- Cannot price credit against a commodity with no located reference, which removes the working capital that would narrow the gap.
Implications
A national price is the wrong object. A single national maize number would average across segmented markets and misdescribe each of them. The launch suite is therefore anchored at a named basis market, with published basis series to related markets.
The binding constraints are finance, aggregation and contract. Each can be addressed before harvest: a price agreed at planting, capital placed at the point of surplus, and a grade verified at source. That is the structure of a forward supply contract.
Conditions that would alter this conclusion
- Northern submissions priced on a 50 kg bag but recorded against the 100 kg standard unit. This would raise the northern per-kilogram price and compress the spread.
- Delivered haulage and assembly costs on the corridor that together approach the spread, which would make freight and handling, rather than finance and contract, the constraint. The haulage assumption is set out in RN 002.
The data behind this note is licensed.
With its audit trail, under the Birkdal Methodology.
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