WHAT IS WAREHOUSE

International trade in agricultural goods is constantly growing, and to help finance this increase in trade flows, innovative collateral securitization mechanisms1 continue to evolve and develop. Emerging markets, however, do not benefit as much as developed coun-tries from the increased trade flows and alternative methods of finance. Warehouse receipt financing and similar types of collateralized lending provide an alter-native to traditional lending requirements of banks and other financiers and could provide opportunities to expand this lending in emerging economies for agricultural trade. The concept of warehouse receipt financing is not new, but what is new is the innovative applications of collateralized lending to extend financing in markets where other attempts have failed. The creative use of the basic principle behind warehouse receipts—collat-eralized lending—in order to design new financing instruments is making new waves in rural finance