Farmers are in for a good time as National Sovereign Investment Authority (NSIA) moves to re-vitalise the Nigeria Commodity Exchange (NCX) in Abuja.
Nigeria Commodity Exchange (NCX), formerly known as the Abuja Commodities and Securities Exchange, was originally incorporated as a Stock Exchange on June 17, 1998. It commenced electronic trading in securities in May 2001 and was converted to a commodity exchange on August 8, 2001.
The conversion was premised on the need for an alternative institutional arrangement that would manage the effects of price fluctuations in the marketing of agricultural produce, which adversely affect farmers’ earnings since the abolishment of Commodity Boards in 1986. But the exchange had challenges living to expectations.
Speaking in Lagos, its Managing Director/CEO, Mr Uche Orji disclosed that his organisation was holding discussions with the Bureau of Public Enterprises (BPE), Ministry of Finance and the Central Bank of Nigeria (CBN) on its plan to takeover the Abuja Commodity Exchange.
He also disclosed that the on-going transaction towards taking over the Commodities Exchange in Abuja would position it to create an agriculture sector that would guarantee optimum earnings for farmers. “We have conveyed our proposal. I’m hoping that we will receive necessary approval,”he said.
According to him, the authority will invest in NCX to enable it develop the infrastructure to carry out its business effectively in facilitating trade and developing settlement instruments and platforms in agricultural produce and basic minerals.
He expressed hope that the commodity exchange will be able to improve farmers’ access to markets and improve their earnings.
According to him, without the exchange, middlemen, who visit villages to buy farm produce would continue to be the main beneficiaries of the effort of the farmers, adding that the organisation was determined to promote sectors that would ensure the industrialisation of the nation’s economy by helping to establish middle industries that can easily fill the gap of specific imports in areas where the nation has comparative advantages.
Meanwhile, the National Council of Privatisation (NCP) has given the nod to NSIA to strategically invest in the Nigeria Commodity Exchange (NCX) equity to help revitalise its operations within a period of five years.
Analysts noted that the success of a commodity exchange is dependent on the availability of both physical and complementary infrastructure as NCX ‘s privatisation would provide the opportunity for investors to utilise both existing and additional resources to close the existent infrastructural gap and improve trading volumes.