As a crucial step to deepen the African commodities market by fostering market integration and data-driven trend analysis, AFEX, Nigeria’s leading commodities market player, today, hosted a webinar on the 2021 commodities outlook.
The virtual session which brought together key regulators, investors, and research experts in the commodities ecosystem, focused expert discussions on the performance benchmarks, policies, and prospects in key commodity markets, creating an enabling environment for players to interact in efficient trade executions.
In the session, data recall from the 2021 commodities outlook report uncovered the backlash effect of the 2020 COVID-19 pandemic crises coupled with seasonal fluctuations and the downturn of agricultural commodity prices. Consequently, the review is a synergized move to promote market sensitization on opportunities that exist in the commodities market.
This encompasses comprehensive data points on market demands and price dynamics of commodities for stakeholders seeking to raise capital flow into Africa’s food systems and market operators on the rise to scale the impact of global economic recovery.
The session led by seasoned Xperts, CEO, AFEX, Ayodeji Balogun, VP, Financial Markets, Akinyinka Akinwumi, and Research Analyst, David Ibidapo, leveraged knowledge and data on the commodity fundamentals to debate factors driving prices and market supplies. It revealed that the agriculture sector suffered decelerated growths in the second and third quarters of the year 2020.
Business activity growth slowed by 1.58 percent in Q2 as against 2.20 percent in Q1 and slowed further by 1.39 percent in Q3, respectively. As part of AFEX’s recommendations, boosting access to loans at a lower cost to smallholder farmers is key to boosting production.
Although policies geared towards achieving this are in place, however proper policy design, monitoring mechanism, and adequate and robust regulatory framework that supervises the implementation and operation of the program are also important.
The outcome will serve as a road map towards executing transformative actions for a viable commodities trading ecosystem in Nigeria. It would facilitate the financial inclusion of farmers, boost farmers’ access to market and quality inputs disbursement.
This is in alignment with AFEX’s mission to create inclusive, sustainable, and efficient food systems for Africa, by enhancing smallholder farmers’ productivity, enabling storage, and driving access to credit & market.
Commenting on the outlook, Ayodeji Balogun, CEO AFEX said “ A commodity outlook review allows us to deliberate on key reforms and market dynamics relevant to a well-functioning commodities market. This is supported by comprehensive data points. It will boost the understanding and participation of market participants across the commodities market in both Nigeria’s agricultural and financial sectors, including stakeholders and policymakers.
This platform will drive standards needed for a sustainable and profitable commodities trading ecosystem needed to tackle the looming food insecurity.” Through this session, AFEX will continue to be bullish towards its contribution to data and insights of the underlying commodities needed for the growth and market diversification of Africa’s commodities ecosystem.
About AFEX “At AFEX we harness Africa’s commodities and talent to build shared wealth and prosperity. Our infrastructure and platforms investments work to unlock capital to power a trust economy in Africa’s commodities markets. Since its inception in 2014, we have developed and deployed a viable commodities exchange model for the West African market, and are on track to impact one million producers; providing services in productivity and value capture and access to finance and markets”.
“By deploying an efficient market system, we will facilitate trade with Africa worth over USD500 million in the next five years. AFEX’s vision is to be the reference point for commodities in Africa. To achieve this goal, AFEX looks to introduce products that de-risk the sector, drive financial inclusion for rural communities, develop technology for data collection and market access, and enable capital deployment”.