2019 1 st CMC Presentation 21 March 2019 Private and confidential - - PowerPoint PPT Presentation

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2019 1st CMC Presentation

21 March 2019

Private and confidential and should not be shared with any third party

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• Commenced intensive engagement with select Asset

Managers on the creation and listing of an agric fund (Food Securities Fund) by Q2 2019, aimed at investing in the entire agriculture value chain all year round.

• Engaged other market players on creating other agric

focused capital market instruments such as a ETCs and repo contracts for investors interested in gaining exposure to commodities.

• Formed a partnership with the Nigerian Export-Import

Bank (NEXIM) as Collateral Managers, to help promote export stimulation, leading to increased production

• utput in the country, higher employment rates and

increased foreign exchange earnings for the country.

• Successfully unveiled a user friendly trading platform

called ComX, where brokers, traders and all other authorized players can trade physical commodities and/or securities.

Important Developments on Capital Market Activities from the Last CMC Meeting

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• Year
• n

year market turnover increased by 191.35% from NGN352.42mn to NGN1.026bn

• AFEX market turnover increased by 784% from

NGN116.135mn in Q32018 to NGN1.026bn in Q4 2018.

• Volume traded increased by 1,020% from 1,025MT

in Q3 2018 to 11,482MT in Q4 2018.

0.00 2,000.00 4,000.00 6,000.00 8,000.00 10,000.00 12,000.00 14,000.00 16,000.00 18,000.00 Maize - White Maize - Yellow Paddy Rice - Long Grain Soybean Ginger Sorghum

• Yellow

Cocoa

Volume Traded (MT)

1,026.76 Turnover (NGN ’mill) 352.42 Q4 Y-O-Y 1,026.76 116.135 Q4-vs-Q3 ’18

Commodity (MT) Q4 Q3 Maize - White 8,905.55 363.37 Maize - Yellow 49.15 3.20 Paddy Rice - Long Grain 1,988.47 628.41 Soybean 279.51 29.59 Ginger 120.43 0.00 Sorghum 123.50 0.00 Cocoa 15.29 0.00 Total 11,481.90 1,025.00

Important Developments on Capital Market Activities from the Last CMC Meeting

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Factors Responsible for the Developments

Comments Market Sensitization

• Working with the regulators to develop clear rules on playing in the commodities space
• Continuous engagement with capital market players
• n creating investable products/

alternative asset class

• Organizing trainings on how to trade commodities and innovative approaches to investing

in commodities Use of Technology

• Creation
• f

a sound technology infrastructure with real time trading data, where transactions can occur efficiently, with trust embedded

• Creating an effective and transparent platform to address all concerns and ensure solutions

are feasible Collaboration with Partners

• Leveraging off other exchanges to bridge the gap between the capital markets and

commodities market

• Leveraging off regulators and clearing houses to ensure fast and efficient settlement of

trades and strong contract enforcements

• Leveraging off relationships with offtakers to ensure constant demand of grains and

promote standardization

• Leveraging off partnerships with associations, groups and committees to design products

and trainings in line with their needs

• Leveraging off partnerships with media houses to promote low cost marketing for

commodities investing Factors

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Steps Taken by AFEX for the Developments

• Market Data Systems – trust system which creates efficiency and increase in trade flows.
• Trading Platform - price discovery and transparency.
• Commodities Index - first of its kind, tracks the price of maize, soybeans and paddy rice.
• Financial Inclusion - transforming traditionally “unbankable” segments of the agricultural

value chain to bankable segments.

• Market Infrastructure - agricultural risks are efficiently measured, managed, and priced.

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Thank You…