Market at Km zero: who’s who in the Somali livestock market?

The Somali livestock market is based on an informal governance that involves numerous people. In the arid and semi-arid areas of the Horn of Africa, where there are few alternatives to livelihood beyond pastoralism, it is essential. Embedded in the social fabric of the communities, the system is personalized, carries few costs of enforcement and rarely witnesses any breach of contract. The central pivot is trust.

28 June 2017 - Central to the Somali livestock market with its numerous actors is trust – at all levels. The system is extensive, involving extended families and ethnic ties, and has such wide reaching social impact that deviating from the rules of the game is distant from anyone’s thought. Embedded in a social system, based on religion and ethnic and family ties, is an informal mechanism of governance of the livestock market that prides itself on low enforcement costs and practically non-existent violations of contract.

A series of actors with well-defined roles and functions abiding by specific rules of the game are populating the market place. Actors can be divided into 3 different categories: pure sellers, pure buyersand people who both buy and sell.Furthermore, there are various services: brokerage, insurance and ancillary.

Pure sellers comprise the livestock owners emanating from neighbouring areas in the catchment zone. They bring their animals and are allocated a particular area within the market. Mostly, cattle (old bulls or steers or old cows) are sold for restaurants or private consumption, while cows and calves are sold only on specific days for breeding purposes. Camels (old, both sexes) are sold at the end of their career for consumption, while small ruminants are sold for slaughter.

Pure buyers are made up of a variety of actors. Kawaanleey (butchers) are licensed wholesalers and retailers who buy live animals in the livestock market, slaughter them, and sell the meat through miijisley (hired labour) in the meat market to private consumers and restaurants. Miijisleyare paid in cash or kind, with men dealing with cattle and camels, while small ruminants are the domain of women. Kawaanleey usually work in shirkadda (partnerships) in groups of 4-5 people who share the profit. Shirkadda tend to deal exclusively with one species. Kawaanleey can also sell meat on credit (without interest) to bio-kum (retailers), who sell it on in the meat market. Their profit amounts to around 10% plus a small amount of meat.

Dhaqaalley is a livestock owner who buys animals for breeding, usually targeting young and healthy females of different species (cattle, sheep and goats). With cattle, the dhaqaalley aim tobuy cows with offspring, thereby increasing their herds’ milk production. Muraadley buy animals (generally sheep and goats) for sacrifice, religious or traditional medicinal purposes, for a wedding ceremony or to welcome a guest. They are allowed to slaughter at home. Makhaayad (restaurant owners) buy sheep and goats directly in the market, and cattle and camels from kawaanleey through meat vendors in town. Private consumers buy live animals directly from the livestock market for their own purposes.

Finally, export traders collect livestock from different markets and arrange for their onward exportation.

People who are both buyers and sellers–gaadley is a livestock trader based in a specific (large district) market. They maximisetheir profit by trading opportunistically, playing on the price differential by buying and selling animals in the same market at different times. Gaadley usually deal with cattle and small ruminants and specialize in one species; they are mostly men, although occasionally womendeal with small ruminants. Sometimes a kawaanleey operates as a gaadley if they can accumulate enough capital to buy small ruminants.

Gaadley may also operate as a gedisley, meaning that they sell in different markets. They can also buy and sell animals in different time frames, either within a day, or keeping them for a season and selling them when prices are high. In these cases, animals are kept in enclosures (sheep, goats) or in open grazing areas (cattle) adjacent to the market place, and shaqaale (labour) is hired to cater for the animals’ needs (feeding, watering etc.). Another strategy to maximise profit is to sell animals on credit at anytime during the year, whenever prices are better. This ensures the availability of animals in the market year-round.

As gaadley buy animals they group them in a specific area not far from the livestock owners’ animals, while when selling they remain in their own area. This is particularly evident in the case of sheep and goats. A dallaal is required to conclude the transaction, and must be aman who is trusted by the gaadley as well as the clan related to the seller in order to certify the origin of the traded animals.

Gaadley record (either by memorizing or writing) the animals they buy and sell; they work by themselves and trade with different actors, for example muraadley or dhaqaalley buy sheep and goats. Kawaanleey, export traders and dhaqaalley buy cattle. Gedisley can buy animals from the gaadley as well.

Gedisley are traders without a fix market base whocover a wider area, crossing regional borders. Similar to the gaadley, they maximize their profit on price differentials either by buying animals at low cost in one market and selling them later at a higher price in another market, or by buying animals in poor condition during low demand periods, in order to fatten and sell them at peakperiods for export at premium prices. Generally they work on their own.

Gedisley dealing with sheep and goats share the same market area with the gaadley, and their animals are mixed, while gedisley dealing with cattle share the market place with livestock owners. The two can be distinguished as gedisley work with greater numbers and negotiate on an average price for a group rather than as individual animals. The average price is based on the species at hand and applies to all categories (steers for export market and old bulls for the local market). Gedisley are the main suppliers of cattle for the export traders especially during the rainy season.  Similar to gaadley, they keep the animals near the market place and hire shaqaale to look after them.

Brokerage and insurance services – the dallaal functions as a broker between buyer and seller negotiating the price and as a damiin (traditional guarantor) assuring the animal’s provenience and that it is not stolen. Sometimes the positions of dallaal and damiinare covered by two people. Dallaal need to be licensed to work; they work on commission, deal with all species of animals and follow the timetables of the markets they serve.

Adallaal works on behalf of his sub-clan, guaranteeing the property and origin all the animals involved in a transaction. In the market all sellers belonging to the dallaal’s sub-clan physically group together around him in the same area of the market as transactions take place. The dallaal keeps records of all animals sold so that the owner can be traced if necessary. In some cases dallaal are former gedisley/gaadley that lost their capital and changed profession in order to accumulate enough money to start trading again.

Licensed dallaal of the same sub-clan work in partnership, especially when tracing the properties of animals transacted. Commissions are also shared among the members: a fix amount goes to the dallaal who finalizes the deal whereas the rest is equally shared amongst the other partners.

Ancillary services comprise fodder sellers, usually women who work very long hours, bringing dry maize or sorghum stalk (Bal) and green grass (Caws), from surrounding farms. Cattle are the main consumers of fodder, while camels and small ruminants tend to do without. Livestock owners buy the fodder during the market time, while gaadley, gedisley and export traders buy fodder both during the market time and for stock kept in the enclosures or grazing areas adjacent to the market.

Other services include the laamiley, a young boy who marks the animals with pitch when they are sold, using the owner’s code; drug vendors; stick vendors, particularly used to contain and drive cattle; and rope vendors, usually women who frequent the small ruminant area of the market. The ropes are used to restrain animals purchased and guide them to the buyer’s place of choice. Finally the tea kiosk workers provide an essential service, lasting the full duration of the market time.

Trust rather than economics form the basis of the Somali informal livestock market community, with an intricate set of relations and respect for each other’s roles. Interestingly actors can play different roles interchangeably through time. This is especially true for gaadley, gedisley and kawaanleey. Access to capital seems to be the key to understand such opportunistic behaviour. The kawaanleey, having accumulated enough capital, may decide to venture into buying and selling sheep and goats at different timesin order to maximize his profit margins. The gaadley may play the part of a gedisley if he has sufficient capital to increase the scale of his business and move among markets in search of higher prices. The gedisley require the most capital to operate. Therefore it’s possible to find a person who issimultaneously a kawaanleey and a gaadley in the same market as well as a gaadley and a gedisley. A gaadley may become gedisley later on. On the contrary the scale of operations and the capital required to be an export trader is much bigger than that of the gaadley, gedisley or kawaanleey making it difficult for them to access to this position.

This system of informal governance is not economically efficient as it involves numerous people, but in the arid and semi-arid areas of the Horn of Africa where there are few alternatives to livelihood beyond pastoralism, it is essential. Embedded in the social fabric of the communities, the system is personalized, carries few costs of enforcement and rarely witnesses any breach of contract. The central pivot is trust.

(article and photo by Lucy Wood)