Vusumuzi Dube
Judith Phiri, Business Reporter
THE Zimbabwe Mercantile Exchange (ZMX) will this year introduce warehouse receipts for livestock and horticulture as part of their expansion drive.
ZMX is an electronic agricultural commodity platform launched in August 2021 aimed at providing an open market for commodities with willing buyers and sellers providing price discovery mechanisms. The warehouse receipt issued by ZMX is a negotiable instrument which can be used as collateral for credit facilities.
Since its formation, the agricultural commodities exchange has been introducing new crops like soya beans, sugar beans, sunflower, white sorghum, red sorghum and wheat for trading under the weekly auction that began with maize. The diversification of crops has also been touted as an encouragement for farmers to explore new opportunities in the agricultural industry.
In an interview, ZMX General Manager Mr Garikayi Munema said the new warehouse receipts will provide a system for storing and trading livestock and horticultural products.
“The introduction of livestock warehouse receipts and horticulture warehouse receipts is a significant development in the agricultural sector. These initiatives aim to provide farmers and stakeholders with a reliable and transparent system for storing and trading livestock and horticultural products. The livestock warehouse receipts will enable farmers to hold tradeable receipts that represent ownership of livestock, such as cattle, sheep, pigs and goats. These receipts can then be used as collateral for accessing credit facilities or as proof of ownership during transactions.”
He said similarly, the horticulture warehouse receipts will serve as a mechanism for storing and trading horticultural products, including fruits, vegetables and flowers.
“Farmers will be able to deposit their produce in accredited warehouses and receive warehouse receipts that represent the value of their stored goods. These receipts can be traded or used as collateral for financing their agricultural operations.”
He said the introduction of the warehouse receipt systems enhance market efficiency, promote price discovery and facilitate access to credit and financing.
“Additionally, it provides a secure and transparent platform for buyers, sellers, and financial institutions to participate in agricultural commodity trading. The implementation of livestock warehouse receipts and horticulture warehouse receipts is expected to contribute to the growth and development of the livestock and horticulture sectors, improve farmers’ income and create a more sustainable and inclusive agricultural ecosystem,” he said.
He said ZMX will also introduce a cross-border trading of commodities to enable participants’ access to a broader range of grains and oilseeds.
Mr Munema said this initiative will connect Zimbabwean traders with regional markets, fostering economic cooperation and expanding market access.
Meanwhile, ZMX is also working on expanding its warehouse facilities for the convenience of the farmers. Mr Munema said this will contribute to reducing post-harvest losses and improving overall supply chain efficiency, as well as enhance market coverage, allowing a greater number of farmers to participate on the exchange.
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