AHL Commodities Exchange (AHCX) general manager Davis Manyenje has said the decision to engage them and Agriculture Commodities Exchange (ACE) to oversee the procurement of maize for strategic grain reserves signifies the confidence government has in commodities exchange in Malawi.
A commodities exchange is where various commodities and derivatives products are traded.
For example, new business opportunities are helping to expand this market.
Malawi Government and World Bank recently signed the Malawi Floods Recovery Project (MFERP) agreement that will allow government to carry out a number of activities to recover from the effects of devastating floods the country experienced early this year.
Under this project, government will purchase non-genetically modified organism (GMO) maize to restock the country’s strategic grain reserves at Kanengo in Lilongwe which are managed by the National Food Reserve Agency (NFRA).
Manyenje told Business News last week in Lilongwe that by using AHCX and ACE as auctioning agents, it shows that government is appreciating the role the two bodies are playing in the procurement system.
“With the situation that we are in where maize is needed in large quantities some would have imported GMO maize and there was need for government to safeguard against this.
“We want the maize to be of good quality which is suitable for human consumption and is not infested with weevils and moisture content is not above 12.50 percent,” he said.
Manyenje said for farmers to satisfy the required amounts, they need to work in groups whose minimum lot per bid is 50 metric tonnes.
“During the tendering process, phones and Internet will be very handy and tendering will be done through the AHCX portal because NFRA wants to make the process open and transparent to remove suspicions,” he said.
Manyenje said with the recognition by government in the tendering process, more farmers will be conversant with the operations of AHCX and the commodity exchanges will also benefit since government is predominantly the biggest buyer.
Government, through NFRA, recently invited bids for the supply of maize at K95 000 ($211) per metric tonne.