Monday, February 01, 2021 / 5:40PM / Kainosedge Consulting for AFEX Commodities Exchange / Header Image Credit: AFEX Commodities Exchange
The AFEX Commodities Index continued its 6-week consecutive bullish trend, closing the week with a 7.86% increase from the previous week. This is mostly attributable to the uptick of prices of grains on the exchange, as maize, soybean and sorghum were priced higher than they were last week on the exchange.
Tne AFEX Export Index returned to its bullish trend closing at 8.04% as against the previous week. Ginger experienced a price surge making it the major driver for the AEl coupled with the marginal uptick in cocoa price on the exchange.
Total volume traded on the Exchange during the week stood at 42,106 contracts with maize and sorghum being the highest traded commodity with 27,190 and 10,976 contracts, respectively. Ginger was the highest traded export commodity on the exchange with 2,131 contracts for the reporting week while cocoa was the least traded commodity at 105 contracts as the outlook for the commodity remains uncertain and highly tied to the effectiveness of the COVID 19 Vaccine and lockdown policy of key demand regions.
Sesame for the reporting week experienced an uptick of 3.27% W-o-W closing at N46,203/contract while ginger and maize experienced the highest price surge closing the week at 16.42% and 10.52% W-o-W closing at N87,333 and N20,142 respectively. Generally, investors priced most commodities on the exchange higher than they did in the previous week.
Local indicative open market survey prices for maize, paddy rice, sorghum, cocoa and ginger were higher than Exchange traded prices. However, investors on the Exchange priced soybean, cocoa and sesame, higher during the week under review.
Week-on-Week in the open market, maize prices increased by 2.57%. Similarly, soybean and paddy rice increased by 5.97% and 0.88%, respectively. Sorghum and ginger decreased by 1.335% and 1.18%, respectively, while cocoa and sesame remained the same as the previous week's price in the open market.
Traders are optimistic about ginger prices, this is due to the supply gap in the country amid demand pressure for the commodity, driven by the perceived superiority of the commodity in Nigeria compared to the same commodity in Asian countries. The total demand for the commodity in Nigeria is estimated at 31 million and 65 million MT respectively, hence, we expert an uptick in the commodity price.