Singapore Commodity Exchange (Sicom), a company of Singapore Exchange (SGX), has teamed up with China's Sino Rubber Electronic Trading Market Co Ltd to launch an over-the-counter (OTC) rubber forward clearing service with final settlement by physical delivery in China.
The service is expected to be launched by the second quarter.
Sino Rubber is the largest professional market for natural rubber trading in China, now one of the world's foremost importers and users of rubber. And Sicom is Singapore's regulated marketplace for the trading of commodity futures and the world's price discovery centre for natural rubber.
Under an agreement signed between the two parties, Sino Rubber will facilitate the delivery of the OTC rubber forwards that are cleared in Sicom.
'The introduction of an OTC clearing facility for rubber forwards will complement the physical rubber trade in Asia and contribute to better mitigation of counterparty and settlement risks,' Sicom and Sino Rubber said a joint statement.
Jeremy Ang, Sicom chief executive officer, said the partnership 'will anchor Sicom as the pricing benchmark for physical rubber'.
Sino Rubber chairman Li Ming Quan said he hopes the collaboration will aid both companies in extending their market to international players. 'China and Singapore have a longstanding relationship,' he said.
(Source: irco.biz)
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