The long-awaited commodity and exchange as well as a regulated warehouse receipt system to ensure price stability and ready market for producers in agribusiness in the country would be realized by the end of this year, officials have disclosed.
The system, expected to provide sustainable and affordable finance to farmers who would use their commodities as collateral, has been touted for some time now.
Speaking at the opening of a two-week training for stakeholders involved in the setting up of the Ghana Commodity Exchange, the Minister of Trade and Industry, Ms Hanna Tetteh stated that some of the advantages of the warehouse receipt system are assurance of quality and quantity because of the proper system of storage and ascertaining the value.
She said the Exchange Commodity which is receiving funding from the UNDP under its Trade Initiative Project, would serve as an additional mechanism to support the agro industry.
“It would bring small holder farmers to the main stream sector and give them an incentive for doing so and therefore translate to significant changes in their lives.”
She said it would also serve as an incentive for the multinational companies and other large scale producers to source local raw materials “as they would be assured of quality”.
Ruby Sandhu-Rojon, UN resident Coordinator and UNDP Resident Representative agreed that even though the establishment of a commodities and exchanges may not be the panacea for all the weaknesses of the agricultural sector “they have the potential to improve the functioning of agricultural markets…”
“We look forward to working with the Ministry of Trade and other partners to ensure the Ghana Commodities Exchange is established and operational by the end of 2012. We eagerly await the start of the first trading on the floor of the Commodity Exchange to enable the Ghanaian farmers obtain fair and predictable pricing for their produce.”
The Ethiopian Commodity Exchange is the most successful in Africa, and it is assisting Ghana to establish an exchange modeled after that of the former.
Dr Eleni Gabre-Madhin, Chief Executive Officer of the Ethiopian Commodity Exchange who is leading a team to train stakeholders in Ghana, said Africa with its untapped potential arable land cannot afford not to embrace this innovative instrument to manage and ensure food security on the continent.
The idea of establishing commodity exchanges, she said, “is resonating across the continent and we have been visited by 18 countries so far and have signed memoranda of understanding with about three of them.”
The Ethiopian Commodity Exchange, which was established in 2006, is now trading 580,000 tonnes of commodities valued at $1.2 billion.
The exchange in Ethiopia, which trades coffee, sesame seeds and maize, has 350 members of which 12 per cent are small farmers and records $20million daily from clearing activities which is in excess of 10 times the average of $2 million trading value of the Ghana Stock Exchange.