Ethiopia exchange eyes food aid in expanded trade |
By Aaron Maasho, Reuters | June 22, 2012
"We are currently in discussions with the government about how to take on a much bigger way maize and wheat trading in the country, including monetisation of imported food aid into the country through the exchange," Eleni Gabre-Madhin told reporters.
Eleni did not elaborate on how this might work when asked for details, but a system to allow the government to sell surplus food aid would permit it to raise funds for initiatives such as drilling boreholes for water or improving the country's electricity supply.
"We have been also in discussions about, to some extent, sugar trading and further fruit crops as well," she said.
Africa's biggest coffee producer has big plans to boost agricultural output by 2015, including coffee volumes to 700,000 tonnes.
Its ECX commodity exchange, launched in mid-2008, also wants to expand. It currently trades coffee, maize, sesame and white pea beans through an open cry system. It announced plans last year to trade sorghum, chick peas, lentils and niger seeds by expanding warehouse facilities, and to introduce forward and future contracts within three years in a bid to tackle hoarding which has affected the coffee market.
Eleni, who leaves her post to take on an advisory role in September, said planning for forward and future trading had stalled.
"The policy dialogue (on future trading) was a bit stalled partly because of the various crises that keep occurring in the broader market globally and over fears that the design would have to really be cautious here in Ethiopia," she said.
"For the moment that project is on hold."
The exchange had a trading value of $1.5 billion and links over 2.4 million farmers through its information system.
Traded volumes reached 608,000 tonnes in the last fiscal year, up from 502,000 tonnes the previous year, according to company figures.
The government is forecasting a rise in coffee export revenues to $1.3 billion from last year's $841 million, when output rose to 7.50 million 60-kg bags. The International Coffee Organisation (ICO) has forecast Ethiopia's crop at 8.3 million bags.
Exports reached almost 200,000 tonnes last year, but have faltered with just 75,000 tonnes shipped in the first eight months of this fiscal year which ends in July.
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