Why G-Soko Certification

G-Soko certified warehouses offer commercial storage services to both farmers and traders. After harvest, farmers are faced with a choice: sell the grain immediately, or store it? If they store it, they have to decide whether to put in their own or a cooperative store, or in commercial storage. Traders face a similar choice: they can immediately sell the grain they have bought, or keep it until they find a purchaser who is ready to pay the right price.
G-Soko certified warehouses offer farmers and traders commercial storage services leading to the following advantages:

  • Lower costs. The farmer or trader does not have to invest in his or her own storage facilities and equipment, or in the staff to manage the grain.
  • Storage space. Farmers or traders often have little storage space, or it may be unsuitable for storing grain for long periods. They may have more grain than they can safely store themselves.
  • Grain-handling equipment. Individual farmers and traders cannot afford grain-handling equipment such as dryers and cleaners. Commercial grain handlers have such facilities.
  • Convenience. When the farmer or trader deposits the grain in a commercial warehouse, the warehouse operator takes over responsibility for handling and storing it, in return for a fee. This leaves the depositor free to do other things.
  • Quality management and pest control. Grain storage is one of the major challenges farmers and traders must deal with. Some lack the skills and experience in managing grain on-farm or in cooperative stores, so their grain deteriorates quickly. They may not be allowed to use restricted pesticides (such as phosphine) for fumigation. Commercial grain handlers offer such services at an affordable fee.
  • Security. Individual farmers or cooperatives may be unable to protect the grain from thieves, leaky roofs or fire. They may find it difficult to get insurance for a crop in their own store. Commercial grain handlers are normally insured, and are obliged to compensate depositors if the grain is stolen or spoiled.
  • Professional services. Commercial grain handlers provide professional services so they can attract repeat customers, compete with other handlers, and avoid having to compensate depositors for spoiled grain.
  • Transfer of ownership. If the grain is in commercial storage, the grain depositor can sell it to a buyer without having to move it somewhere else. This reduces losses and costs due to bagging or re-bagging, spillage, theft, etc.
  • Linkage to markets and structured trade. G-Soko trading system links farmers and traders to opportunities for structured trade and commodity financing. All G-Soko warehouses are electronically linked to a trading portal that has a network of buyers and links farmers to better markets for the stored grain. Because commercial warehouses store grain from many producers, larger buyers use them as sources of large quantities of grain. That saves such buyers money: they do not have to go around many places to buy small amounts at each location.