Heritage Bank Plc has solicited for the inclusion of a Commodity Exchange in the bilateral agreement between Lagos and Kano states to cater for the growth of agribusiness and commerce in the country.
The two states signed the Memorandum of Understanding (MoU) last Thursday at the Lagos-Kano Economic and Investment Summit.
The goal of the pact was to ensure the collaboration between the two states, boost commerce, agribusiness and increase their revenue generation.
Speaking at the plenary session on “Growth & Investment Opportunities in Agribusiness – Value Chain Approach”, Olugbenga Awe, the bank’s Group Head, Agric Financing, said there was an urgent need for the establishment of a Commodity Exchange, stating that it would provide the platform necessary for the success of the MoU signed by the states.
Awe said if the Exchange was established, it would make future contracts between traders and speculators in both states and others more possible and thereby enhance agribusiness in the country generally. Specifically, he stated that the establishment of a Commodity Exchange would help to put the activities of grain farmers and others in Dawanau Market, Kano, and others, in the spotlight.
According to him, the volume of agribusiness and commerce going on daily in Dawanau Market, which is the hub of grains and seeds trading across the world, needs to be complemented by appropriate policies.
Based on this, Awe advised the two states to ensure that the MoU captures the establishment of a Commodity Exchange. Doing that would make tracking possible for every produce traded on the floor of the exchange unlike now when grains sourced in Kano or Lagos could be sold and consumed in other parts of the country without knowing its source.
“Today, goods sourced at Dawanau are daily transported to Togo, Burkina Faso, Cameroon, Chad, Niger, Ghana, Central African Republic, South Africa, Libya and other African countries. Again, traders from Burma, Dubai, India, China, Britain, America, Saudi and other countries patronise the grains/seeds market for items like moringa seed and leaf, sesame seed, hibiscus flower (zobo) and other items such as soybeans, beans, cassava, millet, and guinea corn without any credit given to their farmers and Nigeria.”
Awe, therefore, said the Commodity Exchange would help to address issues like that, adding that it would also encourage farmers to put in more efforts in planting more grains.
Similarly, Dr. Sani Hussaini Sagagi, Deputy Country Director, Sasakwa Africa Association Nigeria, said any country that wants to progress must take cognizance of its population structure when formulating policies.