Zimbabwe: All Set for Commodities Exchange Launch

The commodities exchange — the Zimbabwe Mercantile Exchange (ZMX) has finalised on-boarding of participants on the platform as it fast approaches its launch scheduled for end of this month.

This also comes in time for the beginning of the 2020/21 agriculture marketing season. A pilot programme started beginning of October 2020 and is expected to run up to March 31, 2021 which is also the scheduled launch date.

An update on progress made so far towards operationalising the exchange shows that custodian and settlement banks, farmers, warehouse receipt financiers, commodity off takers and end users, regulators, quality inspectors and warehouses among others have been on-boarded.

The success of the commodities exchange will ride on the operationalising of the Warehouse Receipt System (WRS). This will help address one of the challenges farmers face- that is poor storage facilities resulting in post-harvest losses.

In line with this, warehouses will be used to facilitate the grading, certification and physical safekeeping of the commodities in their warehouses.

Custodian banks will be responsible for custodianship of the platform’s settlement accounts and client’s physical warehouse receipts while settlement banks will manage settlement accounts as well as accept and action settlement instructions from the exchange. Identified warehouse receipt financiers will be offering credit to warehouse receipt holders thus farmers will have access to post harvest funding, which is currently lacking and affecting production.