Chronicle Editor
Judith Phiri, Business Reporter
THE Zimbabwe Mercantile Exchange (ZMX) has said it will be officially launching its Agricultural Commodities Auction on Wednesday, which will assist farmers in getting market-determined prices.
Launched in 2021, ZMX is an agricultural commodities trading platform with automated electronic warehousing and receipting capabilities.
It is operated by the Financial Securities Exchange and was founded as a joint venture between the Financial Securities Exchange (FINSEC) and the TSL Limited representing the private sector and the Government of Zimbabwe.
In a statement, ZMX said thereafter, the auction will be conducted online every Wednesday at the same time.
“ZMX announces the launch of its Agricultural Commodities Auction set to commence on Wednesday, 21 June 2023 from 8am to 4pm. This weekly auction will be conducted online every Wednesday thereafter, at the same time.
“The auction is in accordance with the ZMX Trading Rules gazetted in Statutory Instrument 184 of 2021 and will start with maize and eventually include all other commodities listed on the exchange,” read part of the statement.
It said the auction comes as an addition to the existing normal trading where orders are posted and matched continuously, while with the auction, buy and sell orders are also posted continuously but matched at the end of the auction with one clearing price.
ZMX said the mechanics of the auction are designed to cater for as many buy and sell orders as possible, allowing buyers and sellers with similar needs to meet in the market at once.
“The commencement of the auction follows the registration of buyers, sellers, traders and contractors as well as the issuance of warehouse receipts that has been ongoing. Registration of participants is still open.
“Interested participants who have not done so, are required to register with both ZMX and Agricultural Marketing Authority (AMA) as required by the law. Once registered, farmers and contractors can deposit their commodity into ZMX certified warehouses and receive warehouse receipts that will be used for trading,” said the statement.
Commodities currently listed and trading on the ZMX include maize, red sorghum, white sorghum, millets, soya beans, wheat, barley, sunflower, groundnuts, sugar beans, cow peas and roundnuts (Bambara nuts), while the exchange will be listing other agricultural commodities in future, inclusive of horticulture and livestock products.
Since its launch, ZMX has been instrumental in getting rid of challenges such as limited market access for small-scale producers, price volatility, price discovery challenges, post-harvest losses and agricultural funding challenges because of lack of collateral security and other market-related issues.
ZMX provides three key functions, namely, a warehouse receipt system (WRS), spot market and forward market.
The Government has said the ultimate aim of ZMX is to improve the livelihoods of over 70 percent of Zimbabweans, whose source of income depends on agriculture.
Online Reporter