Kudu: Auction design for agricultural commodity trading

We are trialling an auction system called Kudu, which is designed for trading agricultural commodities in Uganda by phone or web. This is a double auction, meaning that buyers and sellers submit their information separately, and we computationally find the best matches.

This approach seems more promising than both single auction systems (i.e. listings sites, which can’t be used with a basic phone or anywhere bandwidth is scarce) and price advisory systems, which have problems with accuracy and timeliness (wholesale market prices in Kampala change in the course of hours, hence a weekly price bulletin is of limited use). By matching buyers and sellers algorithmically we can overcome these problems.

The prototype web interface to the auction system can be tried here: kudu.ug (requires a Ugandan mobile phone number for registration), or text BUY or SELL to 8228. The crops we are currently supporting are coffee, beans, sweet banana and watermelon.

Work supported by a Google Research Award.