Farmers here will benefit from the recently launched regional commodity exchange market, because it is now possible to trade their produce on a regional platform which can offer higher returns.
“The East African Exchange market serves the East African Community. Rwanda being part of it is very crucial since this will give a chance to farmers to produce quality products compete with other traders on market hence gain more from their trade,” Kadri Alfah, the Chief Operations Officer at EAX said.
“We have started working with different farmers’ cooperatives (about 120.000 farmers) through the Ministry of Agriculture and Animal Resources and these are going to help other farmers bring their produce to our warehouses,” Kadri said.
“We have about 13 certified warehouses so far. We want to train farmers on how to produce quality items that fit to the standards of the region,” Kadri said.
The EAX will link small-scale farmers in the East African community (EAC) to agricultural and financial markets so they can get competitive pricing for crops and access to finance.
EAX will use NASDAQ’s OMX X-Stream trading platform for electronic trading and warehouse receipts so farmers can deposit their produce into EAX certified warehouses and access its services.
Kadri said they deal in grains (beans and maize) but expect to go into marketing tea and coffee very soon.
“EAX aims at transforming Rwandan farmers from rural farming to commercial farming,” he said.
Since Rwanda’s biggest population is based in the agriculture sector, and this is mainly the rural population this will help improve on farmers’ livelihood.
Kadri said grain standards will be used in the process and again it is a platform for price recovery and this can be used as a reference point for the region.
“We aim at bring buyers and seller together in a very cost effective way,” he said.
The EAX provides opportunities for faster and more inclusive African economic growth through intra-African trade previously unseen on this scale in the region. More regional trade will increase employment, accommodate a higher number of market participants and drive greater scale in terms of agricultural financing, according to a statement.
EAX aims at helping farmers manage post- harvest losses which stand at a 40% currently and is a very big challenge to them.
“We want to reduce this percentage substantially,” Kadri said.
Rwandan farmers are required to pay subscription fee of Rwf300 and here they are able to get integrated into the EAX system.
They will be able to sell commodities all over the region which is still an advantage to realizing their dreams through agriculture.
“We want to help farmers get value from what they produce, and to take advantage of price increases during the course of the season where at the beginning of the season prices are very low and therefore they make less,” Kadri said.
He said they again wanted to build the capacity of farmers on how to trade through warehouses.
EAX started working from Rwanda in early 2013 but has managed to see some achievements in such a short time.
“We have started trading already and we are changing farmers’ perspective on post harvest losses and these are great achievements for us,” Kadri said.
Source: East African Business Week
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