‘Commodities exchange to cater for both small and large-scale farmers’

THE Financial Securities Exchange Limited (Finsec), in partnership with the government, TSL Limited and CBZ Holdings, has established an agriculture commodities exchange, the Zimbabwe Mercantile Exchange (ZMX). The platform, which provides an organised market place for farmers and buyers of commodities such as grains, is part of the government’s plans to transform the agriculture sector. The Financial Gazette’s Staff Writer, Farai Mabeza (FM) spoke to Finsec general manager, Garikayi Munema (GM), on the development.

FM: Explain how the warehouse receipt system works and how it is linked to a commodity exchange?
GM: When a farmer brings their produce to a warehouse, they will be issued with a receipt which specifies the type, weight and grade of commodity deposited. The warehouse receipt is a document of title and is issued by a participating warehouse.
The warehouse receipt can be negotiable and can be transferred from one holder to another. Trading on the ZMX Commodity Exchange shall be based on warehouse receipts, meaning that investors will trade warehouse receipts which give the holder title to the commodities stored in the war