Tuesday, February 16, 2021 / 9:28AM / Kainosedge
Consulting for AFEX Commodities Exchange / Header Image Credit: AFEX Commodities Exchange
The AFEX Commodities Index (ACI) continued its 7-week bullish trend, as it increased by 3.62%, closing the reporting week at 388.95 basis points. This is attributable to the increase in prices of maize, soybean, paddy rice and sorghum which are constituents of the ACI.
The AFEX Export Index (AEI) closed the reporting week with a marginal 0.002% decline closing at 159.60 basis points as against the previous week. This is as a result of the negligible decline in ginger prices on the exchange while cocoa prices remain unchanged in the last 2 weeks.
Total volume traded on the exchange during the week stood at 239,163 contracts being a 14% increase from the volume traded last week. As grains accounted for about c.99% of the total trades for the week. Cocoa volume traded on the exchange surged as against the previous week, increasing by c.300% as we see gradual increase of international demand for export commodities on the exchange.
For the reporting week, soybean outperformed other commodities as price appreciated 13.31% W-o-W. Sorghum on the other hand hit its all time high after a marginal growth of 2.67% in price, settling at NGN19,195/contract. On the other hand, export commodities price like that of cocoa remained flat as 747 contracts were traded around NGN104,333/contract while Ginger experienced a minute decline by -0.01%. Sesame for the week increase marginally by 0.60% closing the reporting week at NGN47,617/contracts.
Local indicative open market survey prices for maize, paddy rice, sorghum, cocoa, ginger and sesame were lower than Exchange traded prices. However, players on the Exchange priced soybean, lower during the week under review.
Week-on-Week in the open market, maize prices declined marginally by 0.10%, also sorghum and ginger prices decreased by 1.49% and 4.79% respectively. On the other hand, soybean increased slightly by 0.63% while paddy rice, cocoa and sesame remained the same as that of the previous week.
Egg in Nigeria is a vital source of protein as it is usually affordable by the low- and middle-income class in the country who constitute the larger proportion of the county's population and the demand for the food item. Despite the increased price of the food item, and the demand significantly outweighing it supply, we expect an increase in the prices of grains used in making poultry feeds in the country.