SEC to Facilitate  Financing Platform  in Commodities Sector

The Securities and Exchange Commission (SEC) is set to provide a platform for selected players in the commodities trading ecosystem, the capital market and other relevant industry members to engage with mining companies to discuss opportunities for accessing long-term funding in the Nigerian capital market via a workshop.

This, according to the commission, is part of the implementation of the capital market master plan and part of the strategies to foster a thriving commodity-trading ecosystem, over the next few years.

The master plan designates commodities exchanges as critical for enabling investment diversification, risk management, price discovery and transactional efficienc

According to the SEC, the workshop which is titled “Financing the Solid Minerals Sector through the Capital Market and the critical role of the Commodities Exchanges” is scheduled to hold this week in Lagos.

According to the SEC, it is organising the workshop in collaboration with the Federal Ministry of Mines and Steel Development to enlighten capital market operators on the roles of the mining industry, and how it could admit players in the solid minerals extractive industry into the commodities trading ecosystem.

The expected target audience is selected mining companies in Nigeria.

The SEC DG, Mr. Lamido Yuguda, had recently said that commodities exchanges will create jobs and facilitate economic development among other benefits, adding that such exchanges are critical to enabling investment diversification, risk management, price discovery and transactional efficiency.

Yuguda stated that commodities exchanges have the potential to efficiently link commodities to industries thereby creating jobs, improving living standards and unlocking the economic potential of farming communities, promoting rural development, enhancing financial inclusion of small holder farmers, and ultimately facilitating economic development, amongst other benefits.

He described the workshop as indeed timely considering government’s policy shift towards economic diversification and the need to deepen capacity across the agricultural value chain.

He said a thriving commodities trading ecosystem, with grading and standardization features, would ensure compliance with established grades and standards, eliminate or reduce the proliferation of sub-standard commodities in the markets, and encourage global acceptance of commodities produced in Nigeria, among other benefits.

According to the SEC DG, the Technical Committee on Commodities Trading Ecosystem had in 2017, developed a roadmap for the actualisation of a vibrant commodities ecosystem. The committee specifically identified the development of a grading and standardisation system that will align with International best practice as an important precursor in achieving vibrancy in the ecosystem.

“I am happy to report that the Ecosystem Roadmap Implementation Committee has been working tirelessly on the development of a grading and standardization system, “ he added.