Ghana’s soya market has received a boost from the signing of a partnership agreement between the Ghana Commodity Exchange (GCX) and RDF Ghana, a development finance institution.

Under the partnership, RDF is providing a GH¢1 million dedicated credit line to selected brokers to settle farmers who need immediate cash for commodities they deposit into a GCX-designated warehouse.

The partnership aims to provide a ready market for smallholder farmers while improving their incomes and standards of living. It includes an option to scale up to cover other agricultural commodities.

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.

As at 2017, the country had about 20 percent self-sufficiency in soya production.

Earlier this year, GCX partnered ARB APEX Bank, which provides services to rural and community banks, to advance short-term loans to farmers through warehouse receipts.

This meant that smallholder farmers could use their commodities in storage as collateral to obtain short-term loans from partner banks.

So far, under the warehouse receipt financing model, GCX has engaged about 15 rural and community banks across the country, a step further into developing agricultural finance.

According to the exchange, smallholder farmers can also benefit from its other value-addition services, such as moisture testing, cleaning, drying, grading, re-bagging, and storage—all aimed at improving the marketing qualities of their harvest so they can attract premium prices.