Auction Holdings Commodities Exchange (AHCX), the structured market for agricultural produce in Malawi, says it has registered in excess of $1.9 billion (about K855 billion) in trade enquiries in 2013 and attracted the attention of international commodities importers worldwide.
AHCX head of operations Davis Manyenje told Business News in the capital, Lilongwe that the success stories registered so far, confirms the transformational path the company has embarked on in commodities trading.
“The first year of operations has been exciting as well as challenging with lots of learning. At the end of the day, the experiences from 2013 can only help AHCX position Malawi better on the commodities space, as well as implement strategies that are meaningful to all its stakeholders both domestically and internationally,” he said.
Manyenje attributed the growing confidence in the commodities exchange to the implementation of an elaborate end-to-end market solution for buyers and sellers, emphasis on quality assurance, transparency and efficiency in price discovery.
He said they have partnered with a number of commodity exchanges in other countries to share competencies and market information with the aim of exposing Malawi’s potential to the world.
Manyenje, however, said the main challenge has been supply constraints in its first year of operations.
“It has always been disheartening to see our local farmers losing value and failing to benefit from their sweat due to inefficient unstructured marketing system that we have used since time in memorial.
“We are now transforming the commodities trading landscape, bringing in transparency and efficiency, as well as ensuring that issues of quality are comprehensively addressed to make Malawi’s commodities attractive on the international market,” he said.
Manyenje said several financial institutions are now coming up to support farmers and traders with warehouse receipt financing on commodities other than tobacco.
He said the same applies for other service providers that are also now coming up to offer production inputs, confident that the farmers now have a sustainable and assured market structure, where a recovery of lending is almost assured.