GCX partners with RDF Ghana to provide financing for soya sourcing

Image Source: GCX

GHANA – The Ghana Commodity Exchange (GCX) has entered into a partnership with the RDF Ghana, a development finance institution, to avail a GH¢1 million (US$170,500) dedicated credit line earmarked for soya aggregation.

According to the trading platform, the funds will support brokers to aggregate Soya into the GCX designated warehouses for trading and immediately settle farmer’s payment for the commodities they deposit.

Through this, the partnership will be providing a ready market for smallholder farmers while improving their incomes and standards of living.

The agreement was signed at the GCX premises by the CEO of GCX, Mrs. Tucci Goka Ivowi and the CEO of RDF, Mr. Yaw Oppong.

“The pilot phase of this partnership involves a GH¢1 million (US$170,500) credit line earmarked for soya aggregation with the option to scale up to cover other commodities within the Agricultural Commodity Value Chains,” highlighted GCX.

Ghana Commodity Exchange is a modern marketplace regulated by the Securities and Exchange Commission (SEC) Ghana for the trading of agricultural and other commodities in an efficient and orderly manner, under set rules.

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The aim of the Exchange is to transform Ghana’s economy by creating prosperity for all commodity value chains and become a regional and global trading hub.

Commodities currently traded on the market place are rice, white maize, yellow maize, soybean, sorghum, and sesame.

“The pilot phase of this partnership involves a GH¢1 million (US$170,500) credit line earmarked for soya aggregation with the option to scale up to cover other commodities within the Agricultural Commodity Value Chains.”

Ghana Commodity Exchange

The partnership with RDF Ghana is part of GCX engagement with banks and other development agencies across the country, aimed to develop agricultural finance.

The proprietors of the RDF Ghana are the government of Ghana represented by the Ministry of Finance and the government of Denmark represented by the Danish Investment Fund for Developing Countries.

The institution was birthed out of DANIDA’s desire to institutionalize a development finance organization that will outlive Denmark’s transition from aid to trade in Ghana by 2020.

Incorporated as a company limited by guarantee, RDF Ghana Ltd. ploughs back its earnings to continuously support access to finance while incentivizing a reduction in the cost of finance amongst financial institutions to the benefits of the Micro, Small and Medium Enterprises (MSMEs).

Value addition of Soya in Ghana

A recent study by the Soybean Innovation Lab (SIL) found that soybean prices in Ghana compare quite favorably to international prices and are consistent with supply and demand factors in the country.

However, the researchers noted that there is significant seasonality in production due to insufficient storage, poor road infrastructure, and challenging logistics during the harvest period.

To improve the situation, the sector has seen emergence of players engaging in value addition and processing of the crop.

Recently the Agri-Business Capital Fund (ABC Fund) provided a loan of US$904,000 to soya milling and aggregation company based in Ghana, Dragon Farming Limited, coupled with technical assistance. 

Dragon Farming processes raw soya beans into soya bean meal, full fat soya and soya oil.

The business has a processing line with a crushing capacity of about 48 metric per day and is on a mission to provide innovative and environmentally sustainable products that satisfy the nutritional needs of farmed animals in Ghana and beyond. 

The loan acquired will enable Dragon Farming to increase market access for smallholder farmers and create more rural jobs.

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