Staff Reporter

Zimbabwe farmers are thrilled about the introduction of agricultural commodities auction by the Zimbabwe Mercantile Exchange (ZMX), which will expand the market and increase efficiency and transparency in the commodities market.

More than 90 tonnes of maize valued at US$24 050 were put up for auction at the first weekly ZMX agricultural auction, which started on June 21.The launch of the agricultural commodity auction, according to numerous analysts, would enhance market efficiency and price discovery.

Shadreck Makombe, president of the Zimbabwe Commercial Farmers Union, said the move to launch the ZMX agricultural auction system was long overdue.

This is a wonderful step in the right direction that has long been needed. It allows farmers and buyers to choose when to sell and buy their grain,” Makombe said.

ZMX CEO, Collen Tapfumaneyi weighed in saying: “We are pleased by the level  of participation  by major players in the agriculture sector. So far, the bid, offer and traded volumes were very encouraging. This gives us confidence  that as participants become  more familiar with ZMX auction model , we can anticipate higher trading volumes  and a more liquid market going forward.”

The weekly auction  is conducted every Wednesday .

According to the trading rules gazette in Statutory Instrument  184 of of 2021 started with maize . But will eventually include  all other commodities listed on the exchange.

The auction comes as an addition to the existing normal trading where orders are posted and matched continuously. With the auction , buy and sell orders are also posted continuously  but matched  at the end of the auction with one clearing price. The mechanics of the auction are made to accommodate as many buy and sell orders as possible, enabling buyers and sellers with related needs to connect in the market simultaneously.