The Commodity Exchange is planning to launch new products on its trading platform this year, including petrochemicals, iron, cotton, and some agricultural produce.
Hossam El Gharaihy, the CEO of the Commodity Exchange, said that they are in advanced negotiations with the marble sector to add marble products to the platform soon. These products will be auctioned in large blocks at the start of their trading. The exchange is also discussing with the General Petroleum Authority to include grease and oil products for trading.
El Gharaihy, speaking at the first Commodity Exchange conference, said that the membership rules have been finalized and will be approved in the first board meeting to be held soon. He said that the current focus is on preparing the trading operation rules to transition the Commodity Exchange from auctions to actual trading.
Ibrahim Ashmawi, the Assistant Minister of Supply, said that the Commodity Exchange intends to collaborate with investment banks to implement a hedging mechanism against price fluctuations for essential commodities, fuels, and animal feed. He said that the state has a secure strategic reserve of commodities for six months, relying on various sources for import, with the Black Sea countries being a major supplier.
He told the Daily News Egypt that global changes require the use of hedging mechanisms against expected price volatility in the coming periods. This allows the state to stabilize the allocation of financial values for commodities in the state budget, especially as commodity pricing is now subject to global, rather than local, changes.
He also revealed plans to collaborate with the exchanges of Belarus and Nepal to transfer trading technology on iron, as they are the most traded commodities. He said that they are also exploring collaboration with several other global exchanges.
Ashmawi said that about 1.5 million tonnes of nine products, including wheat, yellow corn, corn, sugar bran, soybean meal, salt, gold alloys, and silver, have been offered since the establishment of the exchange. This was done through 210 sessions, with a total value of EGP 19bn.
He said that there are 500 executing entities out of 1450 registered companies. He highlighted the advantages of having a regulated market for trading commodities and a mechanism to control prices through the availability of commodities on the exchange’s electronic platform, as well as the ease and flexibility of electronic buying and selling.
Ashmawi said that the Commodity Exchange is one of the mechanisms for market regulation that does not interfere with pricing but works directly between the seller and the buyer without intermediaries. It also provides regular reports and statistics on commodity trading, serving as one of the mechanisms for hedging.
He said that around 243 kilograms of gold and silver alloys, with 106 lots valued at nearly EGP 344m, have been offered through the Commodity Exchange platform. He also said that about 1.2 million tonnes of wheat have been traded, with a trading value of EGP 12.3bn over the past period, covering 106 sessions. More than 139 companies, out of 156 registered private and public mills, have executed about 9,000 operations.
Moreover, 129,000 tonnes of yellow corn have been offered through 50 sessions, with 62 executing companies. Other commodities, such as 183,000 tonnes of sugar valued at EGP 4.5bn, 200 tonnes of soybean meal valued at EGP 4.6m, and 17,000 tons of bran valued at EGP 146m, have also been offered through 43 companies. The Holding Company for Food Industries also offered goods with a trading value of EGP 178.2m.
