SEC, SON, court Operators of Commodities Trading

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SEC, SON, court  Operators of Commodities Trading

Relevance of commodities trading to the growth and development of Nigerian economy will take center stage as the
Securities and Exchange Commission with the Standards Organisation of Nigeria (SON) is set to sensitize the commodities operators on investment opportunities in the asset class.

A statement from the Commission at the weekend indicates that workshop, targeted at commodities operators, including Processors, Farmer Groups, Exporters, Farmer Co-operatives, Merchants/off takers as well as Agric Extension Officers is scheduled for today, November 8 and 9, 2021 will hold at Protea Hotel in Ikeja, Lagos.

“ The Commodities Trading Ecosystem Report has identified standards and grading as essential to determining the quality and value of commodities. The effective use of these standards is guaranteed to eliminate substandard agricultural commodities and enhance domestic and international trade in commodities originating from Nigeria.

“ The Commodities Trading Ecosystem Implementation Committee comprising key stakeholders has been working on development of grading and standardization system in line with International best practice. Consequently, the Securities and Exchange Commission, Standards Organisation of Nigeria, and registered Commodities Exchanges, are organizing a Stakeholders Sensitization Workshop on Agricultural Commodity Standards. The workshop would bring together stakeholders such as government agencies, farmer groups, processors, Agric commodity exporters, merchants/off-takers, collateral managers, development partners and Agric experts, amongst others to provide feedback on the commodity standards to be considered at the event.

Recently, Director General of the SEC, Mr. Lamido Yuguda stated that as part of its implementation of the 10-year Capital Market Master Plan, the Commission constituted a Technical Committee on commodities Trading Ecosystem whose mandate was to identify challenges of the existing framework and develop a roadmap for a vibrant ecosystem.

A committee comprising various stakeholders including the SON was set up to drive the implementation of the report. One of the recommendations in the report identified development of grading and standardisation system in line with international best practice,” he said.

Yuguda stated that it was globally recognised that a unique feature of a commodities exchange is the standardisation of the commodities traded on its platform.

“However, the determination of these grades and standards is dependent upon approved local standards which should take into cognisance internationally accepted standards. Imbibing international standards for export commodities cannot be compromised if the exchanges have to play a pivotal role in export promotion,” he said.

He noted that the establishment of relevant standards would be transformational for the Nigerian commodities trading ecosystem.

“Standards provide consumers with an assurance of fitness of purpose, processors with commodities specifications, and serves as reference point against which features of commodities can be compared. Other benefits include increase in value to smallholder farmers due to premium paid on high quality commodities, reduction of post-harvest losses due to standard post-harvest handling, packaging and storage, as well as increased employment opportunities through the setup of warehouses and assaying companies to provide quality assurance services,” said Yuguda.

SON’s Director-General, Mallam Farouk Salim said the agency was excited to collaborate with the SEC as it seeks to develop the capital market in Nigeria and the Nigerian economy at large.

“We are committed to helping our people especially the farmers and support them to attain food sufficiency. If there is standardisation, the banks will be willing to finance the farmers and the commodities can be exported for the much needed foreign exchange to boost our economy,” he said.

Meanwhile, the Commission recently warmed the capital market operators to uphold the tenets of integrity. The Commission’s Director General, Mallam Lamido stated this as a wake up call to e sure professional practice among the operators.

According to him, SEC Would sanction any operator that engages in unethical practices.

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