Ethiopian Commodity Exchange (ECX)
The Ethiopia Commodity Exchange (ECX) is a national multi-commodity exchange in Ethiopia that brings together buyers and sellers of agricultural commodities.
ECX is a private company jointly operated by ownership, members and the government of Ethiopia. Their goal is to provide a transparent commodity market in Ethiopia. They operate a central market with satellite offices, a system of warehouses and processing facilities that enable farmers or co-ops to deliver a commodity, grade that commodity, monitor prices, sell the product at market and receive payment.
Ethiopian Commodity Exchange (ECX)
Unknown. No published data on transaction costs
Farmers, Primary Market, Co-ops
ECX – Membership has many different types of users. Information to apply for either a client or limited membership is available on the membership page.
Members and clients are active in the market. They also have a number of registered buyers.
There are also the interactions of the farmers and co-ops that are utilizing the market information for crop planning, inventory and prices.
Since 2015, the SMS service currently processes over 800,000 transactions per month while the IVR receives over 1 million calls/month
ECX was created with the purpose of establishing a transparent commodity market in Ethiopia. In order to accomplish this they initially established a system to control the process from the farmers to export. Here is a slide deck from 2013 detailing ECX’s initial planning and rollout.
-Warehouses were established to sample, weigh, and grade commodities and issue a goods received note. The warehouse and quality operations have been spun off into a separate operation Ethiopian Agricultural Commodities Warehousing Service Enterprise with the goals of focusing on modernizing the market platform and ensure quality of commodities
-In order to provide access to market information ECX utilizes a diverse mix of communication methods. These include rural based Market Information Tickers, mobile phone Short Messaging Service (SMS), Interactive Voice Response (IVR) service, Mass media (TV, Radio, Newspaper) and online market information.
-In 2015 ECX rolled out it’s e-trading platform allowing for more transactions and enabling members to make secure trades from anywhere.
-In order to provide more transparency in the sourcing of commodities, ECX introduced eATTS.
-In the last ten years ECX has to adjust to their customer and market needs and expectations. Here is a presentation from 14th AFCA Conference & Exhibition that details how ECX has adapted to better accomplish their objectives.
Provided by ECX
ECX’s Mission: Is to connect all buyers and sellers in an efficient, reliable, and transparent market by harnessing innovation and technology and based on continuous learning, fairness, and commitment to excellence.
Hernandez et al, concludes that despite glowing reviews of ECX, it has little impact on the Ethiopian coffee price dynamics. They conclude that this is due to the fact that Ethiopia already had a well-functioning coffee market and that the efficiency that it introduced may be out weighed by the cost and regulation of the market. 1
Francesconi and Heerink’s research shows that while disputes still exist, the formation of ECX has reduced disputes over renegotiation with suppliers.2
Meijerink et al, found while there is significant potential to reduce poverty, there is the risk that access to the market was more advantageous to the larger scale farmers with easier access to resources than small holder farmers and risked furthering the divide. They recommended that policy should be instantiated to ensure access by small holder farmers and co-ops was enabled by the market. 3
Food Policy Research Institute
LEI Wageningen UR
Ethiopian Institute of Agricultural Research (EIAR)
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- Hernandez MA, Rashid S, Lemma S, Kuma T. Market Institutions and Price Relationships: The Case of Coffee in the Ethiopian Commodity Exchange. American Journal of Agricultural Economics. 2017;99(3):683–704.
- Francesconi GN, Heerink N. Ethiopian Agricultural Cooperatives in an Era of Global Commodity Exchange: Does Organisational Form Matter? Journal of African Economies. 2010;20(1):153–177.
- Meijerink G, Bulte E, Alemu D. Formal institutions and social capital in value chains: The case of the Ethiopian Commodity Exchange. Food Policy. 2014;49:1–12.
Academic and NGO research
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