The Agricultural Commodity Exchange for Africa (ACE) has issued the first guaranteed forward contracts. Buyers are guaranteed to receive the commodity and Sellers are guaranteed to receive payment.
First Merchant Bank of Malawi is financing these forward contracts which make it possible for the Seller to receive part or full payment immediately, or anytime in the period of the contract.
ACE will on a daily basis release forward contract prices. To begin with these prices will be published in the newspapers every Wednesday. To get a forward contract a Seller must have the commodity on a warehouse receipt. This is to secure performance so the Buyer is guaranteed that the commodity will be available on the forward date. ACE will work towards publishing prices for the whole marketing season at the beginning of the season. This will increase transparency and the ability of agricultural businesses to plan effectively.
Please contact ACE if you are interested in learning more about forward contracting.
Agricultural Commodity Exchange for Africa
Plot 28/251 Kanengo Light Industrial Area,
P O Box 40139, Kanengo,
Lilongwe 4, Malawi.
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