Joseph Isangura
Prime Minister Mwigulu Nchemba has announced a sweeping push to modernize Tanzania’s agricultural trading system, declaring an end to the long-criticized “lumbesa” practice that he said has for years exploited farmers through unfair crop measurement methods.
Speaking during the 20th anniversary celebrations of the Warehouse Receipts Regulatory Board (WRRB) in Dodoma on Monday, Nchemba called for the nationwide use of standardized measurements and approved packaging systems, arguing that informal crop trading practices continue to deny farmers the true value of their produce.
“Lumbesa belongs to the past,” he said. “It is a way of stealing from producers in broad daylight.”
His remarks signal a major policy direction aimed at reforming agricultural markets in Tanzania, where millions of small-scale farmers remain vulnerable to price manipulation, exploitative middlemen and weak storage infrastructure.
The “lumbesa” system — widely criticized in farming communities — involves informal measuring methods during crop purchases, often resulting in producers receiving lower payments than the actual value of their harvests.
Nchemba said challenges within the warehouse receipt system should not justify a return to unregulated crop trading, insisting instead that the solution lies in expanding storage infrastructure closer to farming areas.
The Prime Minister also revealed that the government, in collaboration with financial institutions, is developing a framework that would allow farmers to receive advance payments against crops stored in warehouses. Officials say the arrangement is intended to reduce pressure on farmers to sell produce cheaply immediately after harvest or fall into exploitative debt arrangements.
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Under the proposed system, warehouse receipts could also become legally recognized collateral for loans once planned legal reforms are completed.
According to Nchemba, the government is preparing amendments that would allow movable assets — including warehouse receipts — to be used as security for financing, potentially opening new access to credit for farmers waiting for better market prices.
Analysts say the reforms could significantly reshape Tanzania’s agricultural economy by strengthening formal commodity markets, improving price transparency and increasing financial inclusion in rural communities.
The Prime Minister also urged banks and financial institutions to simplify access to small loans for farmers, livestock keepers and small traders, warning that limited financing remains one of the biggest obstacles to agricultural productivity and rural economic growth.
WRRB Board Chairperson Geraldine Rasheli said the warehouse receipt system has already improved transparency in agricultural markets while helping farmers secure more competitive prices for their crops.
During the event, Nchemba officially launched a new national strategy aimed at increasing public awareness and participation in the warehouse receipt system among farmers, cooperatives, traders and financial institutions.
The initiative reflects broader government efforts to modernize Tanzania’s agricultural value chains and strengthen food trade systems as the country seeks to position agriculture as a major driver of industrialization and economic transformation.
Updates from the Government of Tanzania, agricultural policy developments through the Warehouse Receipts Regulatory Board and regional market analysis from the African Development Bank are expected to shape discussions around the reforms in the coming months.
