The need for Nigeria to develop a vibrant commodities exchange capable of attracting investors into the agriculture value chain, and enhancing job creation has been stressed. Capital market experts who spoke in an interview with The Guardian linked Nigeria’s inability to diversify its export base away from oil over the years to the absence of an efficient commodities market.
They noted that vibrant commodities exchange would help increase incomes for farmers and agro-businessmen since as it ensures appropriate pricing of produce.The Nigeria Commodity Exchange (NCX), formerly known as the Abuja Commodities and Securities Exchange, was originally incorporated as a Stock Exchange on June 17, 1998. It commenced electronic trading in securities in May 2001, and was converted to a commodities exchange on August 8, 2001.
The conversion was premised on the need for an alternative institutional arrangement that would manage the effects of price fluctuations in the marketing of agricultural produce, which adversely affected farmers’ earnings since the abolishment of Commodity Boards in 1986. But the exchange had challenges living up to expectations till date.