From Agriculture to Investment: ELÜS

Being an important part of the history of humanity and trade, agricultural products come to our tables after being produced under various difficulties.

BLOG 20.10.2021, 09:56
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From Agriculture to Investment: ELÜS

Producers either sell their harvested products right away or store them and wait for the price of their products to increase further. The emergence of money and investment as a result of trade cannot be thought of independently of agricultural products. People have always sought to invest in new areas besides existing investment areas. Today, especially the younger generations are investing in the cryptocurrency market apart from the stock market. Along with all investment areas, there is also an alternative trading platform where investors can invest in agricultural products. 

ELÜS represents the products in licensed warehouses

E-Warehouse Receipts, abbreviated as ELÜS in Turkish, is an electronic document that represents the products in licensed warehouses. ELÜS is an electronic record created on the database and/or platform established and operated by the Electronic Registry Agency in line with the Electronic Registration Rules by Licensed Warehouse Operators. Agricultural products that have been converted into e-Warehouse Receipts are traded in the Turkish Mercantile Exchange. Transactions at the Turkish Mercantile Exchange (TÜRİB) are carried out on the TÜRİB Trading Platform. TÜRİB Trading Platform brings together buyers and sellers willing to buy and sell agricultural products. Products displayed in ELÜS are stored in Licensed Warehouses and within the scope of guarantee of the Licensed Warehousing system. Licensed Warehousing system refers to the warehouses established through licenses issued by the Ministry of Trade and operating under the supervision and control of the ministry. Agricultural products such as barley, wheat, rye, paddy, hazelnut, lentil, corn, chickpea, cotton, soybean, olive in licensed warehouses and products of the same quantity, type, class, and quality created by the licensed warehouse are represented in ELÜS. 

Real and legal persons can trade as "Investors"

In the ELÜS market, all real or legal persons who hold the ELÜS issued by the Licensed Warehouse for the product delivered for storage or who wish to trade the bonds in question in the Stock Market can trade as "Investors". Farmers and investors who will trade ELÜS must first open an investment account at banks and brokerage houses for ELÜS transactions. After the account is identified and the MKK registration number is obtained, the investor can become an ELÜS investor by completing the transactions through a stock market authorized to open an account at TÜRİB. 

ELÜSs can be used as collateral in contracted banks

Farmers can benefit from government incentives consisting of transportation support, analysis support, leasing support, and various tax exemptions by storing their products in licensed warehouses and connecting them to ELÜS, rather than selling them right away. Revenues related to the purchase and sale of agricultural products stocked in licensed warehouses are exempt from income tax and corporate tax until the end of 2023. In addition, transactions are exempted from stamp duty and VAT. Investors also have the opportunity to utilize loans by using the ELÜSs they hold at contracted banks as collateral. 

ELÜS is valuable for the continuity of agricultural production.

Rapid developments in technology bring constant change in every aspect of our lives. This change enables the diversification in the investment habits of the people. It has been better understood how valuable agricultural products are during the Covid-19 process, which started at the end of 2019 and is still ongoing. Some of the advantages of ELÜS for producers and investors can be given as follows: they can store their products in  licensed warehouses and sell them whenever they want, reduce storage costs, and have tax advantages. Having various opportunities for both the producer and the investor, ELÜS is considered to be valuable in terms of the continuity of agricultural production.

Haydar ARSLAN

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