The fast-growing Ethiopian Commodity Exchange (www.ecx.com.et) on 31 December sold 150 full membership seats for a total of Birr 34 million (US$2.7 million). The new members include 69 suppliers, 45 exporters, 24 local traders and 12 cooperatives and commercial farmers, according to Ethiopia’s Fortune newspaper (www.addisfortune.com).
Coffee exporter Muluneh Kaka made the highest bid, offering Birr 3.3 million for a seat.
A full membership seat gives individuals, companies, public enterprises, cooperative unions and commercial farmers the right to transact any commodity through the exchange. The membership seat is permanent and transferable and is the basis for the ECX to function. Whoever is a member, either full or limited, can trade through the ECX.
The seat sale was initially announced in September 2009 at the ECX annual member’s forum and the initial price was set at Birr 50,000, but there were not many takers. Dr Eleni Gabre-Madhin, CEO of the exchange, told the newspaper they decided to make the sale public, instead of selling only to the members, and interest blossomed: “The membership value has significantly increased… This shows us the value businesspeople give to be a member of the ECX. …Participants came with their own presumptive value for becoming a member.”
She said people who bought the seats will have to be trained by ECX and score at least 70% in a certification examination. Results will be known after two weeks and seats awarded to successful buyers.
There are two classifications of traders: full members can trade any commodities they like and limited members can only trade one commodity. In each classification there are trading members who can only trade on their own account and intermediary members who can trade either on their own account or on behalf of clients.