Transforming Commodity Markets

Speeches Shim

Many East African Community (EAC) countries have undertaken initiatives to establish national commodities exchanges in their respective countries. Modernizing national commodities exchanges create transparent, efficient, and structured national trading systems, giving farmers and producers better prices for their commodities and enabling processors to reduce price and quality fluctuations. While EAC countries have taken important initiatives to support commodities exchange development, there is still work to be done to improve, coordinate, and interlink those exchanges.

Harmonizing the EAC national commodities exchanges by synchronizing legal and regulatory frameworks as well as basic infrastructure (including commodities warehousing standards) will promote efficient trading of regional commodities. Regional interconnectivity will promote trade and improve food security, and in the longer term, these commodities exchanges will level the playing field and facilitate improved export competitiveness for farmers throughout East Africa.

Market inefficiencies are mainly caused by a lack of transparency, low sale prices and poor revenue for farmers, limited access to information to track production and storage, and limited access to agricultural credit. Inefficiencies exacerbate food insecurity and leave countries less equipped to handle food chain disruptions caused by environmental threats like locusts, drought, and famine, and global crises like the COVID-19 pandemic.

Issuing Country 
Date 
Tuesday, April 27, 2021 - 10:30am

Last updated: April 27, 2021