Why must major consumers of agricultural produce make use of a commodity exchange in sourcing their raw materials?
Apart from promoting realistic pricing and price discovery, a commodity exchange is capable of making possible the following for the major consumers: Low cost of transaction as there will be a reduction in search cost Guaranteed quality Regular supply of the required raw materials as ASCE will have a network of members that are merchants in various crops Reduction or total elimination of contract failures as trading members operate strictly according to the rules
