In a groundbreaking initiative, Commodities Tradenet Limited, in collaboration with the Lagos State Government through the Lagos Rice Company (LASRICO), is inviting savvy investors to participate in the rice forward contract series 1. This innovative investment opportunity presents a unique chance for investors to engage in the booming rice market in Lagos, Nigeria.
Unlocking Potential with Forward Contracts
A forward contract is a customizable derivative contract between two parties to buy or sell an asset at a specified price on a future date. In this case, the underlying asset is the premium Eko Rice, a high-grade farrow 52 long grain rice with exceptional quality characteristics, including less than 2% impurity level and 14% moisture content. This forward contract series is poised to leverage the growing demand for rice in Lagos State, where a population of approximately 20 million consumes a staggering one million tons annually, contributing to 20% of Nigeria’s overall consumption.
State-of-the-Art Processing at Imota Rice Mill
The Imota Rice Mill, a state-of-the-art facility commissioned in January 2023, plays a pivotal role in the success of this forward contract. Constructed by the globally recognized Swiss-German brand Buhler, the mill employs cutting-edge technologies to process raw paddy rice into high-end grade finished products. This ensures the delivery of top-quality Eko Rice, a key factor in the viability of the forward contract
Operational Excellence through Lagos Commodities and Futures Exchange (LCFE)
The forward contract transactions will be executed through the Lagos Commodities and Futures Exchange (LCFE), ensuring quality management, transaction efficiency, and transparency. Subscription for this investment opportunity is set at N33,000 per unit with a maturity period of 60 days. The transaction will be listed on the LCFE, offering a platform that not only trades agricultural commodities but also currencies, oil and gas, and solid mineral commodities.
“While it’s tempting to pull back, we believe that companies that double down on growth will not only rebound faster but will also emerge stronger as a result. “
Leading the Way in the Market
Governor Babajide Sanwo-Olu’s recent launch of the N5 billion Eko Rice Forward Contract Programme marked a significant milestone in the State Government’s commitment to promoting agriculture and enhancing food security. This joint initiative between LASRICO and Commodities Tradenet Limited is the first series of the N30 billion Private Commodity Notes Issuance Programme, a testament to the government’s dedication to ensuring undisrupted paddy supply, quality management, and transparency in commodity transactions.
Strong Partnership and Expert Guidance
Futureview Financial Services Limited and Futureview Securities Limited, alongside GTI and other esteemed investment outfits, are playing key roles as joint lead transaction advisers and dealers. Their involvement, along with that of United Capital, Dominion Trust, PAC Capital, and Kairos Capital, underlines the confidence in the success of this forward contract series.
Diversification Opportunities
The LCFE currently supports trading in 13 agro-commodities, including paddy rice, cocoa, cashew, and more. This wide range of products provides investors with opportunities to diversify their portfolios and participate in the growing agricultural sector in Nigeria
Conclusion
As the first forward contract for Eko Rice gets listed and traded on the Lagos Commodities and Futures Exchange, investors have a unique chance to be part of a transformative venture that not only promotes economic growth but also contributes to the enhancement of food security in Lagos. With the backing of a state-of-the-art processing facility and a government committed to agricultural development, this forward contract series stands as a beacon of opportunity in the dynamic landscape of commodity investments.
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