Traders take note. Ethiopia aims to launch a commodities exchange in September of this year.
The Ethiopian Commodities Exchange (ECEX) will be fully automated and provide daily-indexed prices on the following goods:
- Haricot beans
The market is an attempt to bring order and transparency to the agricultural sector, thus making it more efficient. Studies estimate that only a third of the grain produced by Ethiopian farmers makes it to market. I’m guessing that the farmers themselves consume much of the remainder, but apparently there is significant surplus that is not utilized.
The ECEX will electronically connect 10 different warehouses throughout the country, establish 20 remote trading sites, and 200 electronic information boards in various rural areas. It is hoped that these initiatives will level the playing field between producer and purchaser. Smallholders will know what their produce is actually worth on the market, thus preventing them from being taken advantage of. It should also allow them to make more efficient cropping decisions.
Dr. Eleni G. Medhin heads the project. She has contributed a number of very thoughtful pieces on the nature of markets to the Ethiopian press recently.