Bursa Malaysia Bhd, operator of the nation’s stock exchange, said it expects the volume of palm- oil futures trading to more than double in the next two to three years following a stake sale and tie up with CME Group Inc.
About 20 percent of palm-oil contracts in Malaysia are traded through international investors, Bursa’s Chief Executive Officer Yusli Yusoff said. The exchange is also seeking to raise the valuation of the commodity’s derivatives, which he said are trading at a discount to other products such as soya oil.
CME “will help elevate palm oil’s visibility and close that price gap with other edible oils,” Yusli said in a Bloomberg Television interview. “We are going to leverage CME’s status as a market leader and this will help elevate the international profile of our derivatives exchange offerings.”
Bursa is counting on the agreement with the world’s largest futures market to strengthen Malaysia’s position as the global price benchmark for crude palm oil futures. It also enables CME to tap demand for palm oil trading outside Malaysia, the world’s second-largest producer.
CME will buy a 25 percent stake in Bursa’s derivatives unit and license its palm oil settlement prices to tap demand for the world’s most-traded vegetable oil, the two companies said on Sept. 17. The collaboration will lead to the listing of all existing and future Bursa Malaysia derivatives products on CME Globex, CME’s electronic trading platform, they added.
Attracting Investors
“We see this as a medium to long-term initiative,” Yusli said from Kuala Lumpur.
Bursa is looking to attract more investors to bolster trading in Malaysia’s equities and derivatives markets. The benchmark FTSE Bursa Malaysia KLCI Index has risen 39 percent this year, trailing behind Southeast Asian benchmark indexes.
Yusli also expects the number of initial share sales to increase in the next 18 months as the economy recovers, starting with Maxis Communications Bhd., Malaysia’s largest mobile-phone operator, which is expected to go public in the fourth quarter.
“We see the pipeline to be quite interesting for next 18 months,” he added.
More Recent Palm Oil News 
- Crude Palm Oil Futures End Lower On Profit-Taking
- Indonesia to export only 50% of CPO output by 2015
- Reject efforts to limit growth of oil palm estates in Malaysia
- Crude Palm Oil Ends Up On Record Low End-Month Stocks
- Crude Palm Oil Prices Likely Under Pressure If Crude Drops -Fry
- Malaysia Feb CPO Output 1.16 Mln Tons; Down 12.5% On Month -MPOB
- Palm Oil Demand to Rise Faster Than Production, TransGraph Says
- CME US Dollar Crude Palm Oil Futures Specifications
- Crude Palm Oil Ends Down On Weak Crude Oil Futures
- CME Group Announces Launch of Dollar-Denominated Crude Palm Oil Futures
- Palm Oil Players Prefer Malaysia For Trading
- Palm Oil Industry Needs To Increase Yield Through Research And Innovation
- Crude Palm Oil Ends Up; Market Expects Bullish Forecasts
- Crude Palm Oil Ends Down; Choppy Trade; Outlook Awaited
- Crude Palm Oil Ends Up; Bullish Outlook, Short Covering
PRO Palm Oil Live Market News
- India Commodity Prices Including Palm Oil – Agriculture
- MARKET TALK: India Soyoil Futures Steady; Weak Palm Oil Weighs
- Malaysian Cash Market Prices For Palm Oil – March 11
- Crude Palm Oil Futures End Lower On Profit-Taking
- Indonesia Astra Agro Sells 5,000 Tons Crude Palm Oil (CPO) Thursday
- Indonesia's PT KPB Sells 2,000 Tons Crude Palm Oil (CPO) At Auction Thursday
- CPO Likely To Gain In 2H Amid Rising Demand, Dwindling Supply
- China Soybean Futures Up On CBOT Rise, But Restrained By CPI Data
- MARKET TALK: BMD Crude Palm Oil (CPO) Futures Down On Profit Taking
- China Dalian Commodity Exchange Grain Stocks, Mar 11
- India Commodity Prices Including Palm Oil – Agriculture
- China Dalian Grain Futures Closing Prices, Volume
- MARKET TALK: BMD Crude Palm Oil (CPO) Futures Down On DCE,China Rate Hike Fears
- Malaysian Cash Market Prices For Palm Oil – March 11
- MARKET TALK: CIMB Keeps M'sia Plantation Sector As Trading Buy