SEC drafts legislation for commodities exchange
The Securities and Exchange Commission (SEC), is currently drafting the appropriate legislation for the regulation of the proposed commodities exchange.
The SEC is working with the technical committee on the project to that effect.
The commodity exchange will connect the buyers and sellers of locally grown agricultural commodities in an efficient, reliable and transparent manner.
The SEC in 2010 commissioned a feasibility study into the establishment of a commodity exchange in Ghana.
SEC is currently working together with the Ministry of Trade as well as the Finance Ministry to establish the Ghana commodity exchange.
A commodities exchange is an exchange where various commodities and derivatives products are traded.
Most commodity markets across the world trade in agricultural products and other raw materials (like wheat, barley, sugar, maize, cotton, cocoa, coffee, milk products, pork bellies, oil, metals, etc.) and contracts based on them.
These contracts can include spot prices, forwards, futures and options on futures. Other sophisticated products may include interest rates, environmental instruments, swaps, or ocean freight contracts.
Commodities exchanges usually trade futures contracts on commodities, such as trading contracts to receive something, say corn, in a certain month.