June 22, 2012

Private investors launch grain exchange in Lithuania

Amid expectations of record grain harvest this year, a Lithuanian grain exchange established by private investors, AgroBirza, is being launched in Lithuania, the business daily reports on Thursday (June 21).

"Considering the number of players on the grain market, which can ensure proper supply and demand, we believe that the exchange will be able to function," Mindaugas Gedvilas, a co-founder and co-owner of AgroBirza, told the daily.

Approximately 5,000 farmers cultivated cereals at bigger than 50-hectare land plots last year. The grain purchase market has approximately 80 active players and the revenues on the sale of grain total LTL2.5 billion (US$909 million).

"The growers, in particular small ones, in Lithuania do not have a place where they could state their price out loud. Electronic platform is an ideal tool for that. This type of electronic broker with the elements of an exchange enables to save both costs and time," Gedvilas said.

Lithuania's growers and grain buyers use the services by France's MATIF exchange in most cases now - the growers for monitoring the developments in grain prices and the traders for actual trading in grain.