The Securities Board of Nepal has announced its plans to establish and manage a commodity exchange market to modernize the trading of agricultural goods, metals, and energy in the country.
Introduction of New Policy
The Securities Board of Nepal (SEBON) has brought out its Capital Market Policy for fiscal year 2083/84. In this new policy, SEBON is preparing to operate a commodity exchange market. This step is being taken to modernize the agriculture, energy, and commodity trading sectors. The main target of board is to manage the trading of agricultural products, metals, and energy goods while developing a clear and transparent system for setting prices.
Solving Old Market Problems
According to SEBON, the current trading of agriculture goods, metals, and energy products is based on very traditional systems. Because of this old system, there is no transparency in prices and middleman have too much influence on market. To solve this problem, SEBON decided to develop a price discovery system through the new commodity exchange.
Support for Farmers and Businesses
Under the new policy, SEBON plans to make an Electronic Warehouse Receipt System. This system will help in storing agricultural goods and certifying their quality. It will also help farmers to getting loans and financial help from banks based on the goods they have stored in warehouses. To protect producers and businessmen from heavy ups and downs in market prices, a financial system for hedging will also be prepared.
Technology and International Standards
SEBON also wants to connect this commodity market with banking systems, insurance services, and warehouse financing. To keep everything transparent, they will build a digital trading system and a real-time market monitoring system. SEBON is planning to work with international expert organizations to improve their technical and institutional capacity for running this market.
According to their Action Matrix, SEBON will study and prepare a consultation paper in next fiscal year for starting contract trading in agricultural and metal products. They will also improve the legal rules of the commodity market to match international best practices.
AI Disclaimer: This article was originally published on https://bajarkochirfar.com. It has been translated with the help of AI. For the best understanding and accurate facts, we recommend reading the original Nepali version.
