The Ghana Commodity Exchange says due to the coronavirus pandemic, its buyers within the off-taking chain have reduced.
The Exchange is a private-public partnership initiative that provides a regulated market linking buyers and sellers of commodities to trade.
Already, the Exchange says the amount of produce it receives for the five listed items from mostly smallholder farmers is now less also due to the pandemic.
As much as the Exchange depends on farmers for its stock, its buyers are equally critical as they serve as the link between the Exchange and the final consumer.
In an interview with Citi Business News, the CEO of the Exchange, Dr. Kadri Alfah, said the drop in buyers has contributed to the overall fall in its operations in the last few months.
“We’ve also suffered from the off-taker side as well because those who were buying from us were mainly processors of food. They were businesses that were processing. They buy raw material from us and process. Most of them have actually scaled down their operation and some of them have actually shut down completely. So that it the reason why the off-taking side has gone down,” he said.
Dr. Alfah is however positive that things will take off again as buyers have started purchasing commodities from the Exchange.
“The Exchange has seen some sign of improvement coming in and some of them are beginning to come and buy from the Exchange again. So, we are very optimistic that things will improve” he added.
The Buyers or brokers
The businesses and individuals who register as buyer brokers, can either buy from the farm for onward selling or export.
For such brokers to be recognized, they would be required to registered with the GCX and keep maintaining their yearly membership status. Their source of revenue would emerge from margins on the selling of produce bought from the exchange.
These are brokers who had played a major role as aggregators in the past by buying especially maize, storing and selling them in lean seasons.
But with the emergence of the GCX, they would still have the opportunity to perform the role of acquiring produce from farmer and depositing in the GCX warehouses.
The farmer may however have to choose from getting a little lower but instant revenue from such aggregators.
The negotiation would however be based on the standardized price quoted by the Exchange.
The aggregator would in turn deposit into the GCX warehouse and wait till lean season to shore up margins associated with the season.