The Ethiopian commodity exchange was established for the first time in 2008 mainly concerned for the development of an efficient and transparent market system by interlinking and protecting the legal rights of buyers, sellers and the general public. The first trading bell rang in the new building of EXC in April 2008.During that foundation stage, the exchange began trading in Maize,Wheat,Coffe and Haricot beans. At the following year, ECX added more cereals products. One of the newly added cereals which came into the exchange market in 2009 was Sesame. Before the year 2008, the idea of commodity exchange was not totally expected to be implemented in Ethiopia since it wasn’t introduced in Africa because of the mistaken thoughts that the general strategy of executing a new trade system might result another negative impact to the economy of the country. Therefore the auction practices were mainly practiced by the Ethiopian coffee and tea authority center (ECTA).A week before the emergence of ECX, the 37 year-old coffee and tea authority center was closed so that the internationally standardized and labeled system of commodity exchange has officially started.
ECX has paved a great way for Community brokers for efficient, safe and standardized system of modern trading and commodity exchange capabilities. To ensure the maximization of free, fair and transparent exchange of commodities, new and up to date design of contracts have been prepared mainly for preserving the unique and original coffee quality by increasing the number of buyers and sellers to freely participate in the competition of price bidding. Thanks to Dr Eleni Zawd Gebremedihin that she turned the theoretical well analyzed and designed commodity exchange project into a strong economic as well as trade maximization standards for all of the African countries. Dr Eleni,the chief executor of ECX until October-2012, is a great African economist working more than two decades in international economic forums has received a number of local and international awards and recognitions. Yara prize in 2012, African Banker Icon award,ECX:2011 CIC 100,and The Agricultural commodities initiative award were some of the awards she received.
The ECX has installed digital electronic screens in all over Ethiopia for the public to access the information needed or held at the moment of bidding and competition of trading. In addition, for those who want to follow the trading auctions through the internet and mobile phones, a new technology has started working with the collaboration of Ethio-telecom. This leads a great opportunity for Ethiopian farmers to follow the market trends without barrier and sell the products for the sustainable earning of well-deserved income access. Also, proportional distribution of wealth accumulated through ECX has been practiced that all the farmers become wealthy within a short period of time.
When the overall number of participants in the ECX system is investigated, farmers, cooperatives and a group of commodity integrated unions have made big benefits that tend to increase the national trading volume by 49 percent. Currently more than 2.4 million Ethiopian farmers are the members of ECX and everyday more new farmers are coming into the part of this great trade opportunity firm. The growth of ECX is directly related to the trading commodities that were rated between the year 2008-2012.In 2008, the data shows that about 138000 tons were exchanged initially then after 4 years, the amount of commodity exchange shot up to 601000 tons. The other point is that ECX membership fee at the time of the emergence was 50000 birr but the 2011 data shows that the membership fee increased to 1.35 million birr per client. ECX department of information desk said that the increase of membership fee is not aimed to influence the farmer in a negative way rather the electronic market of the world wide system has forced ECX to invest more utility costs which intern results for the rising of membership fee.
During the starting time, the main problems facing ECX were warehouse related costs and shortages at the time of trade exchanges. In addition to this, frequent telecommunication, power failures and poor working environment were also the additives. The good news is that ECX has solved more than 75 percent of the challenges in a steady pace and today a strong, modern and powerful network of trading system is being applied all over the country in the most friendly way than any times.
