Posted on 14 Sep 2022
The Singapore Exchange (SGX) has announced that, starting from 26 September, it will carry out "a suite of cobalt futures and lithium futures contracts for trading and clearing, as well as the corresponding over-the-counter (OTC) cobalt swaps and lithium swaps contracts for clearing."
The futures and swaps contracts to be launched will cover cobalt metal (standard grade), cobalt hydroxide, lithium carbonate (battery grade) and lithium hydroxide (battery grade). The trade terms are in-warehouse Rotterdam, cif China, cif CJK (China-Japan-Korea), and cif CJK, respectively.
In terms of listing periods, starting from the October 2022 contract, it plans to list the cobalt futures and cobalt swaps contracts for 36 contract months and the lithium futures and lithium swaps contracts for 24 contract months.
Pol de Win, head of global sales and senior managing director at the SGX, recently stressed the importance of strengthening partnerships between exchanges. He announced the Baltic Exchange, a subsidiary of SGX, has signed a memorandum of understanding with the Shenzhen Commodity Exchange. The two will cooperate in R&D of shipping derivatives. The SGX also established partnerships with the Shenzhen Stock Exchange and the wholly-owned subsidiary of the Shanghai Stock Exchange on exchange-traded fund (ETF) and data distribution, respectively.
He thinks major trends in commodities will also include increasing numbers of spot market participants participating in commodity derivatives to hedge risks, as well as more attention to environmental, social, and corporate governance related products, Kallanish notes.
He said during a recent conference: "We expect strong growth potential in two key areas of the derivatives ecosystem, the energy metals market, and the voluntary carbon offset market. More than 90% of global trade is carried by sea ... With many uncertainties, the shipping industry will benefit from more effective risk management tools, which is an important reason for continued innovation and expansion of commodity derivatives."
Source:Kallanish
