Vusumuzi Dube
Judith Phiri , Business Reporter
THE Zimbabwe Mercantile Exchange (ZMX) has said it continues to record an increase in the quantity of maize traded on its auction system, while the average price for the staple grain continues firming up, which may help to reduce the gap between the bid and offer prices.
Launched in 2021, ZMX is an agricultural commodities trading platform with automated electronic warehousing and receipting capabilities. ZMX last month launched its weekly Agricultural Commodities Auction system, which is conducted online every Wednesday with the aim of assisting farmers in getting market-determined prices.
In accordance with the ZMX trading rules as espoused in the Statutory Instrument 184 of 2021, the auction system started with maize and will eventually include all other commodities listed on the exchange.
The auction system is practised the world over as a safe trading platform for agricultural produce, as it benefits market forces freely determined by buyers and sellers.
In an update following the auction on Wednesday, ZMX said: “About 147 tonnes of maize were traded on the ZMX auction at an average price of $290 per tonne on Wednesday 12 July. This represents a significant increase in quantity traded from the previous week’s volume of 17 tonnes.”
The exchange said the average price for maize has been on an upward trend in the past two weeks, trading at $285 per tonne, before settling at $290 per tonne at this week’s auction.
ZMX said looking ahead, it anticipates the average price of maize to continue firming up, which in turn, is expected to increase the quantity of maize traded in future auctions.
Recently the exchange engaged the Small and Medium Millers Association of Zimbabwe (SMMAZ) with a view to increasing the number of buyers in the commodities market’s weekly auctions.
ZMX general manager Mr Garikayi Munema told the media in Harare that when they met with the SMMAZ members, they explained to them the operations of the commodities exchange starting from how it’s set up as a Public-Private Partnership involving the Government of Zimbabwe and private sector players.
“As an exchange, we are very excited with the responses that we’re getting, the members (SMMAZ) have shown great interest in participating in the exchange and to be buying commodities on the commodities exchange as it is on a willing seller-willing buyer basis.
“Price discovery is one aspect that they like because it allows the buyers and sellers to determine the price at which commodities will be bought and sold in a free market,” said Mr Munema.
He said from the meeting it emerged that small and medium millers are faced with the unavailability of commodities at the right price.
Mr Munema said the millers want commodities such as maize, wheat, soya bean, red sorghum and white sorghum which seem to be in demand, while as ZMX they were making plans to ensure that they connect them to as many suppliers as they can.
He said plans are in the pipeline to introduce auctions for other commodities such as soya beans in line with market demands.
The exchange has a total of 49 commodities including oilseeds, grains, livestock and horticulture that would be traded on the platform but at the moment ZMX focuses on grains and oilseeds.
Online Reporter
Bongani Ndlovu