Crude palm oil OTC swap use on the increase as prices rise
Limited liquidity on long-dated CPO listed derivatives means users are looking to use centrally cleared OTC swaps
Trading and volume in over-the-counter crude palm oil (CPO) swap contracts are increasing, as supply pressures drive up prices and firms turn to the OTC market to hedge their long-dated exposures, say market participants.
On the supply side, dry weather in the first quarter of 2014 has put upward pressure on CPO prices. The average CPO price rose to $804 per tonne from $792 per tonne in the first two months of 2014, while CPO production and stock levels in Malaysia fell by 23% and 17%
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Commodity markets
Sustainable bond markets miss an options trick
A derivatives mindset could boost lagging sustainability-linked market, argues climate think-tank
Green knights? Banks step into struggling carbon credit markets
Clearer global standards and a new exchange may attract dealer entry, but supply and demand challenges remain
Bachelier – a strange new world for oil options
Model tuned to negative prices has implications for pricing, margining and delta hedging
Asian LNG derivatives trade surges on increased hedging
Expectations grow that a long-awaited Asian gas derivatives market is emerging
US courts restrict reach of Commodity Exchange Act
Recent cases make it harder to pursue instances of overseas misconduct
Esma releases first crop of position limits
Regulator moving away from publishing all limits in November
Carbon life force: derivatives defy coal's bleak future
Coal producers shorting volatility to collect premium, say traders
Plastics hedging rising amid US chemical industry boom
Several obstacles limiting potential growth, say plastics market participants
