Food and Agriculture Organization (FAO) provided a USD 50 thousand fund to the Ethiopian Commodity Exchange (ECX) to help the commodity exchange with its wheat trading system and warehouse receipt financing. ECX utilized the fund to launch wheat trading by conducting various activities including drafting agreements, hosting consultation sessions with stakeholders, and preparing education and communication materials.

A draft commodity agreement which was prepared by ECX to modernize wheat sale transaction was approved this month by the Ministry of Trade and Regional Integration. ECX is now ready to receive wheat from farmers and suppliers and industries will be allowed to buy wheat from ECX once they pass the registration process.

Wheat production is growing in Ethiopia. More than three million farmers across Oromia, Amhara, Somali, and Afar Regional States are engaged in wheat production and the country expects to produce 52 million quintals of wheat during the current Ethiopian year. It was able to produce 110 million quintals during the last rainy season.

Ethiopia is also in the process of exporting wheat to East African countries including Kenya, Djibouti, and South Sudan. Agreements to sell 3 million quintals of wheat have already been signed with six countries including Kenya and Sudan. The country is also prepared to ink agreements which total USD 200 million to supply wheat to non-governmental organizations including the World Food Program.

Source: ECX, Ethiopian News Agency, Fana BC