BURSA Malaysia expects the trading volume of its palm oil futures contract (FCPO) to grow by at least a third this year,
helped by increased visibility on the world’s largest derivatives
exchange, a top executive says.
Bursa Malaysia is in the process
of transfering its derivatives contracts currently traded on an
in-house platform onto CME Group Inc’s Globex platform.
Trading of FCPO, the global benchmark price for palm oil, grew by 33 per
cent to four million contracts in 2009, Bursa’s chief executive Datuk
Yusli Mohamed Yusoff, said in an interview late on Thursday.
A bumper South American soya crop, recovering global demand and the
resurgent El Nino weather condition will be some of the factors driving
Southeast Asian palm oil markets in 2010.
“We expect more interest in our contracts, not just from buyers
and sellers but from people who want to take positions to speculate on
the price of palm oil,” said Yusli ahead of Bursa Malaysia’s Palm and
Lauric Oils Conference next week.
The event, which kicks off
on March 8, brings together industry analysts, global vegetable oil
traders and plantation firms for three days.
exchange operator expects its derivatives offerings to begin trading on
the CME Globex platform in the second half of the year.
“Over time, we will be working with CME to identify what other products
should be developed for our market,” he said. Last year CME Group
bought a 25 per cent stake in Bursa Malaysia’s derivatives unit and
said it planned to develop a US dollar FCPO using settlement prices of
ringgit contracts for trading on one of CME’s platforms.
Turning to the share market, Yusli said “20 or so” new listings, mostly
by local companies, are expected to hit the market in the coming
“Assuming market conditions stabilise, we hope to see
most, if not, all of them coming into the market in the next few
months,” he said.
Bursa is aiming for slightly more revenue
than last year’s RM402 million but profits will likely be flat due to
“Our expectations are that it will be better
than last year’s but how much better will depend on factors like
getting foreign investors back,” he said. – Reuters
Source : Business Times