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COMMEX offers CPO, KLIBOR futures on Net

G. Chandrashekhar

KUALA LUMPUR, March 12

IN a bid to deepen and expand the reach of the market, the Commodity and Monetary Exchange of Malaysia (COMMEX) has launched a new service which, in its first phase, comprises dissemination of real-time market information on the crude palm oil (CPO) futu res and the three-month Kuala Lumpur Interbank Offered Rate (KLIBOR) futures on the Internet.

The price information includes last price traded, bids and offers, change in prices, settlement, opening, turnover and open interest, apart from intra-day charts for easy tracking of price movements. It is available on the Net at www.investorsexchange.co m

The attention of the world vegetable oil market has turned to the palm complex in which prices have been volatile. Interestingly, price movements of soyabean in the Chicago Board of Trade (CBOT) and palm oil in COMMEX are seen to be influencing each othe r.

``Beta testing that started last month attracted several thousand visitors to the site'', Mr. Raghbir Singh Bhart, General Manager of COMMEX (formerly known as Kuala Lumpur Commodity Exchange), told Business Line . ``There is heavy demand for real-time p rice information on palm oil futures following the growing popularity of the commodity in the global market and volatility in prices,'' he added.

Mr. Raghbir has decided to tap some of the important palm oil markets such as India, China and Pakistan which together account for a substantial part of the global palm oil trade. ``These markets are looking for real-time price information and I am confi dent that the subscription of RM 100 a month (less than $30) would prove to be attractive for most players in the sub-continent'', he said.

The COMMEX, which has excellent internal control procedures and market safeguards in place, is keen to rope in more players in the futures market. There is an independent clearing house in which COMMEX owns a 50-per-cent share and the rest is held by Kua la Lumpur Options and Financial Futures Exchange, a wholly-owned subsidiary of the Kuala Lumpur Stock Exchange (KLSE).

Talking about expansion in the scope of services, the COMMEX official said soon there would be value-addition to the content in terms of news, analysis and expert comments. Information on physical trade and price-sensitive developments in the markets wou ld be the next step in the graduated evolution of the site and services, he asserted. A team of COMMEX officials is expected to visit major markets in the near future with a view to popularising the services of the exchange.

CPO futures trade volume in 1999 expanded by 10 per cent to register 3,88,967 lots (of 25 tonnes each) as compared with 3,53,680 lots in the previous year.

``A crude palm kernel oil futures contract is in the pipeline'', Mr. Raghbir said adding that the contract would be launched before the end of the year.

The COMMEX has commenced negotiations with the KLSE for a merger. Once the merger materialises, the services will all be from under one roof and the trading will move towards using an electronic platform, according to Mr. Manoj Devadasan, Legal Manager a nd Company Secretary of COMMEX. ``The merger is expected to be completed by the end of 2000'', he said.

Post-merger, the exchange would become a one-stop shop for market participants interested in both commodity futures and financial futures.

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