Egypt establishes first commodities exchange with EGP 91 mln capital

Doaa A.Moneim , Wednesday 9 Sep 2020

The exchange will protect small farmers and producers by collecting their produce to be offered on the exchange's online platform, supply minister Ali Moselhy explained

Ali Moselhy
Egyptian supply minister Ali Moselhy (Photo: Al-Ahram)

Egypt's Minister of Supply and Internal Trade Ali Moselhy announced on Wednesday the establishment of the Egyptian Commodities Exchange Company with a total capital of EGP 91 million. 

The company comprises seven entities and a number of commercial and investment banks.

The move, directed by President Abdel-Fattah El Sisi, is part of Egypt's plan to develop internal trade, control domestic prices, and provide food commodities at fair prices, the minister said.

The exchange will protect small farmers and producers by collecting their produce to be offered on the exchange's online platform, Moselhy explained.

"Egypt's commodities exchange is a part of the infrastructure of the internal trade system that is expected to encourage small farmers and producers to engage in the formal trade system. The decision will reflect positively on the price of the final product for consumers and producers alike, especially with the decline in the commodities circulation chains among mediators," the minister said.

The company aims at founding a regulated market for storable commodities and managing and equipping stockpiles, said company chairman Ibrahim El-Ashmawy.

He added that it will establish and manage grain silos and cold chains that will be appropriated for the conservation of commodities.

"Supply and demand will control the prices commodities on the online platform. The exchange will provide the basic commodities, such as oil, wheat, sugar and rice as of the first quarter of 2021," El-Ashmawy said.

Meanwhile, head of Egypt's Exchange Mohamed Farid said on Tuesday that the Egyptian Commodities Exchange is a critical pricing mechanism. 

In May, the Internal Trade Development Authority (ITDA) finalised the draft law of establishing the Egyptian Commodities Exchange, which was then approved by Prime Minister Mostafa Madbouly. 

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