Asset management firm unveils commodities fund
STRATUS Capital Partners (Private) Limited, an asset management firm, on Monday launched the Stratus Commodities Fund as part of the firm’s intervention and contribution towards curbing post-harvest losses encountered by farmers perennially.
The Stratus Commodities Fund has already fulfilled the Securities Exchange Commission of Zimbabwe (SECZIM) requirements and will be listed on Financial Securities Exchange (FINSEC) on 20 April 2023.
The commodities fund is designed to counter widespread challenges faced by the agriculture sector players, mainly during marketing season.
It also seeks to encourage efficient price discovery, enhance liquidity flows into the commodities market, improve value chain and post-harvest financing.
According to Stratus Capital Partners, the Zimbabwean commodities market presents significant opportunities for growth, value creation, and the fund intends to raise US$50 million or the Zimbabwe dollar equivalent from the 50 000 000 initial units available.
The fund is the first of its kind as the local financial markets continue to make strides toward harnessing local resources and expertise to provide sustainable funding solutions that support the growth of the economy.
According to Stratus Capital Partners chief operating officer Mr John Bere, the fund is open-ended, meaning individuals can buy units into the fund over time and interested investors are expected to submit their subscription applications to participate in the commodities fund beginning on April
4, 2023, to 17 April 2023.
He said the liquidity will be channeled from the capital markets entailing the pension fund, insurance companies’ banks, and individuals.
“We were invited by Zimbabwe Mercantile Exchange (ZMX) to provide a solution by creating a commodity fund that will provide liquidity into themarket for farmers in particular.
“As Stratus we are launching this fund with a target to raise US$50 million, but you have got to appreciate that the total gap that is required to fund post-harvest agriculture in Zimbabwe is around US$900 million, so US$50 million is a drop in the ocean but it is a start, but we would want to see the
fund grow over time.
“If we reach US$360 million dollars as a fund, which is a quarter of what is required in the economy, we will be very happy, we would have done a lot in terms of enhancing agriculture production in the country,” said Mr Bere.
He said this will allow investors to diversify their portfolios as this alternative investment would be remotely correlated to traditional asset classes such as equities, fixed income and real estate that are already on the local market.
Zimbabwe Mercantile Exchange (ZMX) chief executive officer Mr Collen Tapfumaneyi said he expected the commodity fund to provide a credible source of cost-effective and patient capital to producers, contractors, and agro-processors.
He said benefits of the fund are expected to filter into the wider economy for the benefit of final consumers.
“The commodity fund could not have come at a better time than now when Zimbabwe is on track for another good agricultural season and expecting good harvest across almost all the crops As Zimbabwe Mercantile Exchange (ZMX) was set up to provide the infrastructure and frameworks for an organised, efficient and effective post-harvest financing and marketing activities,” said Mr Tapfumaneyi.
As a listed instrument, Stratus Commodity Fund units are bought and sold on the FINSEC through a registered broker.
The minimum unit of investment in Stratus Commodities Fund will be 100 units.
-herald
