The Capital Market and Securities Authority (CMSA), Public Relations Manager, Mr Charles Shirima said in Dar es Salaam yesterday that some companies have shown interests of trading at the country’s commodity exchange but have not been issued with licences.
“The preparations for the Tanzania Mercantile Exchange (TCX) have reached advanced
stage ready for the takeoff in May this year. Companies wishing to trade as commodities
dealers at the exchange are invited to register at the CMSA,” he said.
The TCX is expected to start by trading in coffee, cashew nuts, sesame, rice, sunflower
and probably maize currently traded under warehouse receipt system.
A commodity exchange is a central place where sellers and buyers meet to transact in
an orderly and organised fashion, with clearly specified and transparent rules.
The government backs commodity exchange as an answer to market challenges.
The training of the first commodities dealers, about 60, is ongoing and will end this
July and licensing them will follow thereafter.
The Parliament passed the bill for the establishment of the TCX after amendiing the CMSA law of 1994 to become Capital Markets and Commodities Exchange Act.
The exchange would provide a marketplace where buyers and sellers meet to trade
and be assured of quality, delivery and payment.
Experts in agro-business have it that the exchange will liberate farmers from poverty
through exposure to reliable domestic and export markets.
Liberalisation has its benefits mainly attributed to price determination as a result of market
forces of demand and supply.
Once farmers know what the market price is, they can enjoy fairer negotiations with
purchasers and can make more informed judgments on what to invest in the future and how to market it.