Agricultural Product Derivatives - Kenya

Kenya

The nominal value in the Agricultural Product Derivatives market market in Kenya is forecasted to reach US$23.24bn in 2024.
It is anticipated to demonstrate an annual growth rate (CAGR 2024-2028) of 4.05%, leading to a projected total of US$27.24bn by 2028.
The average price per contract in the Agricultural Product Derivatives market market in Kenya stands at US$0.13 in 2024.
When compared globally, the in the United States achieves the highest nominal value (US$12,320.00bn in 2024).
In the Agricultural Product Derivatives market market in Kenya, the number of contracts is expected to reach 185.30k by 2028.
Kenya's Agricultural Product Derivatives market shows a growing interest among investors seeking exposure to the country's evolving agricultural sector.

Market

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Analyst Opinion

The Agricultural Product Derivatives market in Kenya is experiencing a notable shift in recent years.

Customer preferences: Customers in Kenya are increasingly looking to diversify their investment portfolios, seeking alternative options to traditional financial instruments. This growing interest in agricultural product derivatives can be attributed to the potential for higher returns and the opportunity to hedge against price volatility in the market.

Trends in the market: One of the key trends in the Agricultural Product Derivatives market in Kenya is the rising demand for derivatives linked to local crops such as tea and coffee. As Kenya is a significant producer of these commodities, investors are showing interest in leveraging derivatives to speculate on price movements or mitigate risks associated with fluctuations in production or global demand.

Local special circumstances: Kenya's agricultural sector plays a crucial role in the country's economy, with a substantial portion of the population engaged in farming activities. The reliance on agriculture makes the agricultural product derivatives market particularly relevant in Kenya, as stakeholders seek financial tools to manage risks and optimize their exposure to the market.

Underlying macroeconomic factors: The stability of Kenya's economy and the government's efforts to promote agricultural development are contributing factors to the growth of the Agricultural Product Derivatives market. Additionally, the increasing integration of Kenya into the global economy and the rise of commodity trading platforms are providing investors with easier access to agricultural derivatives, further fueling market expansion.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.