In times of volatility, the increased trading in FCPO shows continued confidence from the palm oil industry as well as the global trading community in FCPO as an effective risk management tool.
Total trading value and total matched contracts hit RM2.56bil and 794,619, respectively, in the first three months of 2022.The number of local participants has grown from 235 in 2021 to 240 in the first three months of 2022, while the number of foreign participants has surpassed the 64 in 2021 to 67 in the first three months of 2022.
“It provides hedgers a window into the opening of the US market and the closing of the European market respectively, enhancing the price discovery of our products and strengthening the linkage between local and global markets,’’ said Bursa Malaysia. This would offer traders a platform to trade their views on the relative fundamentals for various types of commodities.
Key risks include interest rate normalisation which may further impact retail trading participation, and the lack of growth catalysts.