Futures contracts: Sugar now tradable on PMEX

Mercantile exchange adds another commodity to its portfolio.

KARACHI: Pakistan Mercantile Exchange Limited (PMEX) has announced the commencement of trading in sugar futures contracts. PMEX currently has three contracts for the months of March, April and May. After the announcement, trading in the February contract has officially commenced.

The launch of the futures contract is a step forward in the domestic commodities portfolio of PMEX. The PMEX Sugar Futures is a deliverable contract, tradable in units of 10 metric tons. The contract aims to provide market participants with the opportunity to trade and hedge on a transparent platform. PMEX’s settlement guarantee mechanisms will be advantageous for millers, processors and traders as it will be instrumental in eliminating counterparty risk in trading.

Speaking on the occasion, PMEX Managing Director Samir Ahmed said that “Over the next five years PMEX will focus on developing our domestic agricultural markets. The main objective will be to initially list all the major domestic agricultural products on the Exchange. This will be followed by an extensive marketing plan to create awareness of the immense benefits that an active futures market offers for growers, consumers, traders and processors of agricultural commodities in Pakistan.”

Published in The Express Tribune, February 22^nd, 2012.