Agricultural Product Derivatives - Burkina Faso

Burkina Faso

The nominal value in the Agricultural Product Derivatives market is projected to reach US$1.64bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 5.17% resulting in a projected total amount of US$2.11bn by 2029.
The average price per contract in the Agricultural Product Derivatives market amounts to US$0.02 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (US$12,320.00bn in 2024).
In the Agricultural Product Derivatives market, the number of contracts is expected to amount to 114.70k by 2029.

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Analyst Opinion

The Agricultural Product Derivatives market in Burkina Faso is experiencing a notable shift in dynamics, driven by various factors influencing customer preferences, market trends, local special circumstances, and underlying macroeconomic factors. Customer preferences in Burkina Faso are increasingly leaning towards agricultural product derivatives as a means of diversifying investment portfolios and hedging against price fluctuations.

Investors and farmers alike are recognizing the benefits of these financial instruments in managing risk and maximizing returns in the volatile agricultural sector. Trends in the market indicate a growing interest in derivatives linked to key agricultural commodities such as cotton, sesame, and livestock. As Burkina Faso relies heavily on agriculture for economic growth, the demand for these derivatives is expected to rise steadily.

Additionally, the introduction of innovative derivative products tailored to the local market is further fueling this upward trend. Local special circumstances, such as limited access to traditional banking services and a predominantly cash-based economy, are also shaping the Agricultural Product Derivatives market in Burkina Faso. Derivatives offer a more accessible and efficient way for market participants to engage in agricultural trading and risk management, overcoming barriers posed by the financial infrastructure in the country.

Underlying macroeconomic factors, including government policies to promote agricultural development and attract foreign investment, are providing a favorable environment for the growth of the derivatives market. As Burkina Faso strives to enhance its agricultural productivity and competitiveness on a global scale, the use of derivatives is becoming increasingly instrumental in achieving these goals.

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.