Growing price transparency and algorithmic-led trading is transforming trading. When Michael Farmer, founding partner of metals hedge fund Red Kite, this week blasted high-frequency traders who use powerful computers to execute orders at ultrafast speeds, he spoke for many in the commodities world.
“High-frequency trading appears to have no other purpose than to make money from the trading of other participants by jumping ahead of them,” said Farmer………………………………………Full Article: Source

A new trading platform for buying and selling of base metals for immediate physical delivery was launched in October by German company Metalprodex GmbH, with the most initial trading liquidity in aluminum and lead, the company’s head said.
Newly established Metalprodex is offering an electronic trading platform enabling delivery of physical metal within two days. “We are in the phase of building up liquidity,” Metalprodex’s Managing Director Janko Linhart told Reuters in an interview for the LME Week…………………………………….Full Article: Source

As commodity margins flat-line, the number of traders will shrink as existing trading firms consolidate and digital rivals emerge, U.S. consultancy Oliver Wyman said in its annual commodity trading report.
With the exception of oil and natural gas boosted by volatility last year, growth across commodities is plateauing with combined margins stuck at around US$44 billion per year in 2014 and 2015, the report said. Wyman sees digitization as the game-changer in the next few years that will force independent traders such as Glencore, Trafigura and Vitol, as well as the trading arms at integrated oil companies like Shell and BP, to become ever more nimble and automate many of their activities………………………………….Full Article: Source

Shanghai will open a pilot online cross-border commodities financial services platform in the Free Trade Zone in February, using electronic warrants and digitalized technology. The platform has already signed up well-known names, including MasterCard, Singapore’s DBS Bank, Malaysia-based CIMB Bank, Bank of Shanghai and local payment provider ValuePay.
The new system will allow commodities companies registered in the zone to use e-warrants instead of physical documents. It will match companies with commercial banks for lower interest rate loans and insure transparency of transactions in a global network, according to Commodity Info-Tech (Shanghai) Co, which will operate the platform……………………………………..Full Article: Source

In 2017 physical gold trades by LBMA members will be reported to a platform run by Boat Services. The London Bullion Market Association, which oversees the city’s $5tn gold market, has named the financial technology firms that will run its electronic platform in an effort to bolster trading transparency for the precious metal.
Starting in the first quarter of next year, physical gold trades by LBMA members will be reported to a platform run by Boat Services, a London-based company that provides financial trading technology, and its partner Autilla, another fintech start-up……………………………………..Full Article: Source

Guo Xiaoli will serve as the new Chief Executive of the upcoming Qianhai commodity-trading platform. Hong Kong Exchanges and Clearing Limited (HKEX) has introduced its Qianhai commodities platform, which will help the group compete with other global exchanges, simultaneously servicing a clientele in Mainland China, according to an HKEX statement.
Hong Kong Exchanges and Clearing Limited (HKEX) has introduced its Qianhai commodities platform, which will help the group compete with other global exchanges, simultaneously servicing a clientele in Mainland China, according to an HKEX statement……………………………………..Full Article: Source

The CME Group, owner and operator of the world’s largest derivatives marketplaces, has moved to a low-code platform for business process management. Commodities trading is fast-paced, highly regulated, and critical to the economy. CME Group owns and operates the Chicago Mercantile Exchange, the largest options and futures trading exchange in the world, along with the Chicago Board of Trade, the New York Mercantile Exchange (NYMEX), and COMEX.
CME Group sounds like the sort of organization that would hew to a conservative, time-tested development platform for applications. But according to Ari Studnitzer, managing director of architecture and product management at CME Group, the company has embraced a low-code platform that is helping keep both users and regulators happy………………………………………Full Article: Source

The Tokyo Commodity Exchange on Tuesday put into operation a new trading system that includes extended hours to permit trading at times when economic data is announced. It will also facilitate higher-speed transactions. It is the first such upgrade for the exchange since May 2009, aiming to improve convenience for investors and reinvigorate the sluggish commodity futures market.
TOCOM will share its derivatives trading system with the Osaka Exchange, a unit of Japan Exchange Group Inc., or JPX. Commodity futures industry officials hope that the joint use will encourage stock brokerage firms to start commodities trading………………………………………Full Article: Source

Barclays and an Israel-based start-up company have carried out what they say is the world’s first trade transaction using blockchain technology, cutting a process that normally takes between seven and 10 days to less than four hours.
The transaction guaranteed the export of almost $100,000 worth of cheese and butter from Irish agricultural food co-operative Ornua - formerly the Irish Dairy Board - to the Seychelles Trading Company. The deal was executed via a blockchain platform set up by Wave, a firm that came through a Barclays development programme………………………………………..Full Article: Source

Market regulators charged with overseeing orderly trading are fighting a losing battle when it comes to keeping up with super fast technology. Modern trading can take place in barely comprehendible measurements of time. Banks and high-frequency traders often boast of executing orders on stocks and futures exchanges in milliseconds, or thousandths of a second.
The bar is constantly being raised and already some trade in microseconds (millionths of a second) and even nanoseconds — billionths of a second. To put this into perspective, the average time it takes a human finger to click a mouse is a leisurely 150,000 microseconds………………………………………..Full Article: Source

A new global spot physical metal trading platform called Metalprodex will launch in September, managing director Janko Linhart told FastMarkets. Headquartered in Germany, it has been developed to allow the quick purchase and sale of physical metal.
All metal is delivered physically within two days on the spot market. Metal delivered into any Metalprodex-approved warehouse can then be sold or bought instantly via electronic trading platform MTPX………………………………………..Full Article: Source

The U.S. derivatives regulator is rethinking parts of its proposal to regulate automated trading and looking into whether the rule could affect too many people, it said on Thursday. The Commodity Futures Trading Commission, announcing it had reopened the public comment period on the rule through June 26, also said it is considering who should mitigate the risks of algorithmic trades and how the rule would apply when traders purchase their algorithms and systems.
It said it asked how to define “source code” and what software and hardware should be included within the term “Algorithmic Trading system.”……………………………………….Full Article: Source

Hong Kong Exchanges & Clearing, which owns the London Metal Exchange, the world’s largest metals bourse, plans to set up a national platform for spot metals trading in Qianhai, China to tap into the huge need among Chinese companies to diversify raw material supply sources and hedge exposure to price volatility, a top HKEX official said Tuesday.
HKEX is currently building a trading system for the project and will register a company in the Qianhai special economic zone in Shenzhen and hire appropriate talent, said Li Gang, co-head of the market development division for HKEX………………………………………..Full Article: Source

Hedge funds almost doubled their use of algorithmic trading in the foreign-exchange market last year, according to Greenwich Associates. Sophisticated investors executed 61 percent of their currency trades via automated computer programs in 2015, up from 33 percent in 2014, the Stamford, Connecticut-based financial-services consulting firm said in a report.
That compares with buy-side institutions more broadly, including pension funds and other asset managers, which used algos to handle 33 percent of volumes versus 27 percent a year earlier, according to a Greenwich survey of more than 1,600 foreign-exchange market participants in North America, Latin America, Europe, Asia, Australia and Japan………………………………………..Full Article: Source

The Securities and Exchange Board of India or Sebi is creating a level playing field by restricting the entry of established players, says an expert. The Securities and Exchange Board of India (Sebi) has decided against allowing the two national stock exchanges to launch commodity trading platforms in the near term, said three people familiar with the development.
Both the National Stock Exchange of India Ltd (NSE) and BSE Ltd had sought permission to launch commodity trading on their exchanges after Sebi began regulating the commodity markets last year………………………………………..Full Article: Source

The Securities and Exchange Board of India (Sebi) is working on a plan to allow a single licence for equity and commodity brokers, a move that will help the broking community reduce costs. Though both security and commodity market intermediaries are now regulated by Sebi, following the absorption of Forward Markets Commission (FMC) into it, they still adhere to different guidelines and requirements.
Sebi has initiated an exercise to have a common set of these. “Once the commodity market stabilises, we will allow each lot of brokers to operate in the other segment. It will be done in a gradual and phased manner, so the market isn’t disrupted in any way,” a senior Sebi official said………………………………………..Full Article: Source

First it was the accounting firms and financial companies, and now even Hong Kong Exchanges and Clearing is going north, seeking to open a platform on the mainland to expand its commodities business. But the local bourse may find the challenges bigger than expected.
A trend that first emerged in the 1990s has seen the Big Four accounting firms, banks and insurance companies set up joint ventures or subsidiaries in mainland markets to capture the many business opportunities on offer there. The odd one out was the Stock Exchange of Hong Kong, now part of HKEx, which lured mainland companies to issue H shares in Hong Kong, starting in 1993, but never had any trading platform on the mainland………………………………………..Full Article: Source

Change is brewing in London as the the LBMA – the association that oversees the world’s largest gold market – is looking at how best to modernise and improve over-the-counter gold trading. As members of the world’s gold industry meet this week at the LBMA’s annual conference in Vienna, their proposals are being sought on how to bring the gold trading in London up to date.
According to Eddie Van Der Valt reporting today for Bloomberg, London’s bullion market is more than three centuries old and has cleared about $21 billion of gold on average each day through the city this year. Key considerations for reform include “boosting transparency and… considering a new electronic platform that may lower trading costs and improve efficiency”………………………………………..Full Article: Source

China’s currency is now the third most traded on the EBS platform, overtaking such pairs as the dollar-Swiss franc and euro-yen on one of the main independent venues where banks trade currencies.
Officials at ICAP-owned EBS Brokertec, which competes with Thomson Reuters’ Matching platform in bank-to-bank currency trading, said the number of players trading every day in China’s yuan, or renminbi, had grown 50 percent in the past year. That follows the announcement by the banking payment network SWIFT that the yuan is now the fourth most used currency in ordinary day-to-day payments worldwide………………………………………..Full Article: Source

China’s so-called One Belt, One Road government economic framework was announced in 2013 to integrate favorable trade and investment conditions in Eurasia. The project includes two main components, the terrestrial Silk Road Economic Belt and the oceanic Maritime Silk Road.
“After three years of work we have completed the establishment of a mechanism of trade pricing. It will be officially launched within two months,” Yan Dongsheng said at a conference. The SREB includes countries situated on the ancient Silk Road route, connecting Central Asia, West Asia, the Middle East and Europe………………………………………..Full Article: Source

A new trading platform for oil and gas was launched in China on Wednesday, state media reported, as the world’s largest energy consumer looks to extend its influence over global commodity pricing. The Shanghai Petroleum and Natural Gas Exchange (SHPGX), which is registered in the Shanghai free trade zone, will initially only handle natural gas transactions during a test run.
“We expect (gas) trading volumes at SHPGX would range from 5 billion cubic meters to 6 billion cubic meters in second half of 2015 and annual trading volumes at SHPGX would be more than 10 billion cubic meters in 2016,” Guo Xu, an official with SHPGX, was quoted as saying by the official Xinhua News Agency, which is a shareholder in the exchange………………………………………..Full Article: Source

The share of trading based on algorithms, or algo trading in popular parlance, has seen a sharp rise in domestic commodity markets, amid regulatory concerns on the volatility that such trading can bring to the markets.
Software codes or algorithms are frequently used to automate and enhance order-matching processes. While such trading has been popular in the equities segment for some time now, it has picked up relatively recently in the commodities market………………………………………..Full Article: Source

Currency-trading platform 360T Group is exploring a sale of the company, in a deal that could fetch more than €600 million ($675 million), according to people familiar with the matter. The closely held company has attracted interest from a number of global-exchange and financial-data firms, the people said.
To be sure, it’s possible there will be no deal for the company soon. 360T’s platform consists of software that helps corporations, banks and other financial firms arrange currency and derivatives trades with each other. Its software also helps corporate clients hedge their currency risk. ……………………………………….Full Article: Source

Deutsche Börse has signed a trio of commodities trading entities to use its new M7 trading platform, developed as part of a complete renewal of its trading infrastructure.
Singapore-based regulated futures exchange Cleartrade Exchange, London-based Freight Investor Services Ltd., a broker of freight and commodity derivatives, and Norexeco ASA, a commodities exchange for pulp and paper based in Norway, will start to use M7 in the next few months………………………………………..Full Article: Source

Leading bourse BSE is planning to launch a separate platform for trading of various commodities to foray into commodity exchange business — currently dominated by two major players, MCX and NCDEX. A proposal in this regard has been approved by the board of BSE, which is the world’s largest stock exchange in terms of number of listed companies and holds top positions on various other counts.
Sources said the BSE board has cleared the proposal and further modalities would be put in place soon. Incidentally, BSE had also put in an initial bid, estimated at about Rs 500 crore, recently for purchase of 15 per cent stake in the country’s largest commodity exchange Multi Commodity Exchange (MCX). ……………………………………….Full Article: Source

The data center is changing. We have new methods of cooling, optimizing the data center and even the utilization of green energy through next-generation geothermal technologies. The insides of the data center and what goes into the rack has been changing as well. New platforms around consolidation, server technology and cloud computing are all impacting how we process and utilize resources.
The conversation around custom-build servers, networking components and now storage has been heating up. The concept of a commodity data center is no longer locked away for mega-data centers or large organizations. Looking at Google as an example, you’ve got an organization which builds its own server platform by the thousands………………………………………..Full Article: Source

The European Energy Exchange (EEX) and Eurex Exchange have decided to concentrate trading in agricultural derivatives within EEX, in which Eurex holds a majority stake of 63%. The move is set to give customers access to a large and standardised offering of commodity derivatives contracts via one platform.
Agricultural derivatives currently tradable on Eurex Exchange will be offered on EEX from 2015. Eurex Exchange’s product portfolio comprises futures on potatoes, skimmed milk powder, whey powder, butter, hogs and piglets. All contracts are quoted in Euro and are settled in cash. Market indices which reflect the underlying physical transactions are used as reference prices………………………………………..Full Article: Source

China’s Bohai Commodity Exchange, or BOCE, a government-backed online trading platform, has added molybdenum to its list of spot commodities, and this is expected to boost moly trade in the mainland and increase price transparency, industry sources said Thursday.
On May 27, BOCE — which is headquartered at Tianjin city in Hebei province, north China — officially launched moly concentrate and ferromoly spot trade on its trading platform at its new moly trade center at Luanchan city in Henan Province, central China………………………………………..Full Article: Source

Senators are fearful that high-frequency traders are getting an unfair advantage and endangering the stability of the U.S. futures market, the financial exchange for trades of commodities like corn and gold. But industry experts warn against rushing to impose new regulations.
“These markets have changed dramatically over the years – for a 21st century market, we need a 21st century regulator,” said Sen. Debbie Stabenow, D-Mich., who called a hearing of the Senate Agriculture Committee she chairs to consider the issue………………………………………..Full Article: Source

High Frequency Trading (HFT), through systematic computer based algorithms by gauging market movements and eventually acting upon pre-defined protocols, has become a popular mode commodity derivatives trading.
Such techniques initially introduced in fixed income, currency, and equity markets are now increasingly being applied to trading in bullion, energy, and the agricultural commodities. HFT has contributed to a surge in the number of trades in NYMEX crude from under 1 million in 2005 to almost 42 million in 2011, and in CBOT corn from 133,000 to 10.7 million………………………………………..Full Article: Source

EBS, ICAP’s electronic foreign exchange business, has launched precious metals trading on its EBS Direct platform, the markets operator said on Tuesday.
London-based ICAP operates a number of electronic platforms in a range of asset classes and instruments, as well as acting as an interdealer-broker, matching buyers and sellers of currencies, swaps and bonds………………………………………..Full Article: Source

Premiere stock exchange BSE will launch its platform for trading in currency derivatives from Friday, making it the fourth bourse in the country to offer such trades.
Other stock exchanges present in the currency futures segment are — National Stock Exchange (NSE), MCX-SX and United Stock Exchange (USE). “Exchange is pleased to inform trading members that it will be launching trading in Currency and Interest Rate Derivatives with effect from Friday, November 29, 2013,” BSE said in a notification………………………………………..Full Article: Source

China launched its second pilot carbon trading platform on Tuesday in Shanghai, as the world’s largest emitter of greenhouse gases experiments with market-based systems for reducing pollution.
Almost 200 local companies have signed up to participate in the Shanghai Environment and Energy Exchange. Rules signed into effect by the city’s mayor earlier this month threaten fines of up to Rmb100,000 ($16,400) for companies that did not comply with emissions limits………………………………………..Full Article: Source

The Indian currency market accounts for around 1% of the total world forex transactions, which stand at about $4 trillion on a daily basis. With the introduction of currency derivatives in 2008, the Indian market is poised for further growth by increasing its share in the world forex trade.
The spot transactions involving the rupee totalled around $30 billion in 2010, with the segment accounting for a share of 40% in the total forex turnover in India. This is followed by another 40% in forex swaps, and the rest in the form of outright forward transactions………………………………………..Full Article: Source

In just a short time of operations, commodity trading floors in Vietnam have been facing continued difficulties with trading volume becoming less and less, with any solution still not in sight.
Earlier, departments and organizations inside and outside the country and the Ministry of Industry and Trade had eagerly taken part in developing commodity trading floors in Vietnam. As a result, the country had many trading floors established, such as Buon Ma Thuot Coffee Exchange Center, Vietnam Commodity Exchange and Sontin Commodity Exchange…………………………………Full Article: Source

Dubai’s government-owned commodities centre is launching a sharia-compliant commodity trading platform which Islamic banks in the Gulf could use to manage their short-term fund flows. The Tradeflow platform developed by the Dubai Multi Commodities Centre (DMCC) allows trading of warehouse receipts, which represent ownership of commodities stored at warehouses.
Islamic banks cannot use conventional interbank money markets because of Islam’s ban on interest, so they have struggled with a shortage of instruments to manage liquidity………………………………………..Full Article: Source

U.S. futures regulators are looking into whether high-speed traders indulged in “wash trading,” a strategy in which they improperly buy and sell futures contracts without taking a position in the market, The Wall Street Journal reported, citing people familiar with the probes.
The Commodity Futures Trading Commission (CFTC) is investigating suspected wash trades by high-speed firms in futures contracts tied to crude oil, precious metals, agricultural commodities, and the S&P 500, among other underlying instruments, the people told the Journal. Wash trades are banned under U.S. futures law………………………………………..Full Article: Source

The BMC would give additional security to traders from situations such as the flash crash in the US market. The Forward Markets Commission (FMC), the commodity derivatives markets regulator, has levied base minimum capital (BMC) for algo members five times higher than that of normal manual members. Until now, minimum base capital was determined by individual exchanges based on the membership criteria.
Interestingly, FMC has kept both the Multi Commodity Exchange (MCX) and the National Commodity & Derivatives Exchange (NCDEX) in the same category with Rs 50 lakh of BMC requirement for algo traders. Against that, the normal manual members should require to have a BMC of Rs 10 lakh…………………………………….Full Article: Source

India’s sixth nationwide commodity futures trading platform, Universal Comm-odity Exchange (UCX), is set to go live in April this year with at least 10 agri and non-agri commodities in its kitty. The exchange has enrolled a little 200 members for trading on its platform, which is awaiting the issuance of a unique trading code by the regulator, Forward Markets Comm-ission (FMC).
“We are in the process of getting a unique trading code for each of our registered members. Once that process gets completed, we would be ready for launch,” said Ketan Sheth, managing director of Commex Technologies, the promoter of UCX………………………………………..Full Article: Source

China’s gold market could get a boost from the debut of interbank trading on Monday, with analysts saying the move will enable traders to swap bullion in larger amounts and heighten the appeal of the metal as an alternative investment class.
Trades will be cleared and delivered under the auspices of the China Foreign Exchange Trading System, a subsidiary of China’s central bank, according to a Thursday statement by the Shanghai Gold Exchange………………………………………..Full Article: Source

China’s internationalization of the yuan, also called the renminbi, is gaining pace now that the operator of the Hong Kong Stock Exchange has unveiled the world’s first deliverable offshore yuan futures.
Giving traders a way to bet on yuan futures, through contracts based on yuan-U.S. dollar exchange rates, is “part of our strategy to expand beyond equities and equity-related derivatives,” said Charles Li, chief executive of the market operator, Hong Kong Exchanges and Clearing Ltd……………………………………….Full Article: Source

Once the beating heart of global energy markets, the Nymex trading floor now seems to be in its death throes. Alexander Osipovich asks how much longer open outcry has to live – and whether we should be sorry to see it go.
It was only a few years ago that hundreds of traders were shouting, shoving and jockeying for position in the trading pits of the New York Mercantile Exchange, or Nymex, the world’s top marketplace for energy derivatives………………………………………..Full Article: Source

China has formally unveiled on Wednesday a physical trading platform for rare earth metals. The rare earth trading platform, found in Baotou in north China’s Inner Mongolia autonomous region, was launched by Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co. along with nine other firms and institutions.
Inner Mongolia holds more than half of the light rare earth output of the world………………………………………..Full Article: Source

China’s largest rare-earth producer plans to launch a trading platform, according to a company newsletter, in the nation’s latest attempt to exert more control over the pricing of the strategically important minerals.
Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co, China’s largest producer by output, plans to launch the physical-trading platform Aug. 8, it said on its website in an in-house company news report dated Friday. Baotou is leading about 10 major Chinese rare-earth producers to set up the platform, it said………………………………………..Full Article: Source

The Hong Kong stock exchange will launch a new platform offering commodity trading and settlement within the Asian time zone, Ronald Arculli, former chairman of the local bourse operator, said.
Arculli - now an independent non-executive director of Hong Kong Exchanges and Clearing - said the move follows the recent HKEx acquisition of the London Metals Exchange………………………………Full Article: Source

French bank Societe Generale SA has launched an electronic trading platform focused on trading London Metal Exchange base metals futures, the category one ring dealing member of the exchange said Tuesday.
The platform, to be known as Alpha Metals, provides Societe Generale’s clients with direct access to the LME’s own electronic trading platform, LME Select. It also offers post-trade services………………………………………..Full Article: Source

Pakistan Mercantile Exchange (PMEX), the country’s first commodity exchange in Pakistan, has signed an agreement with Catalyst IT Solutions to provide them with a technology platform whereby PMEX brokerage houses will be able to offer online trading platforms, mobile trading platforms and SMS alert services to their clients.
Under this agreement, Catalyst IT Solutions – a company that provides similar platforms to equity brokerage houses in Pakistan – has integrated its own front office trading software Kinetic with the Electronic Trading System (ETS) of PMEX in a manner that would enable brokers of PMEX to use this software as well as offer it to their clients………………………………………..Full Article: Source

Shanghai’s futures exchange is another step closer to what is no doubt its intended role as the globe’s premier commodity trading platform.
Now it plans to get in on crude oil trading by the end of the year as part of a longer-term plan to have these Chinese contracts getting equal pegging with existing contracts such as Brent crude futures………………………………………..Full Article: Source

Singapore-based GlobalORE will launch its physical iron ore trading platform Wednesday as efforts to set up a price benchmark gather momentum.
GlobalORE will operate trading windows on weekdays between 3 p.m. and 4 p.m. Singapore and China time, and its office will actively assist members who trade during this time period, the company said on its website Tuesday, without elaborating………………………………………..Full Article: Source

The concept of a virtual currency exchange, in which gamers can sign up with to trade their in-game currency with other types of virtual money as well as real-world ones, may see a “good idea”. However, it will be difficult to set up and flourish due to regulatory constraints and lack of game operators’ buy-in.
Charlotte Miller, research analyst at Juniper Research, believes that there is a space in the market for such exchange systems to exist………………………………………..Full Article: Source