SGX, NZX to explore global dairy derivatives partnership

The Singapore and New Zealand stock exchanges are joining forces to expand the Kiwi bourse's dairy derivatives market.

The deal signed yesterday involves exploring listing the New Zealand exchange's suite of dairy derivatives contracts on the Singapore Exchange's (SGX) trading and clearing platforms.

"This would see the NZ exchange bring its dairy product development expertise and client relationships, while leveraging SGX's global market connectivity, strong Asian presence and international distribution, to scale growth and liquidity in the trading of dairy derivatives," the SGX said.

SGX chief executive Loh Boon Chye said the partnership "demonstrates that exchanges can collaborate for mutual benefit and the betterment of the wider industry".

"Our successful commodities derivatives franchise, with its infrastructure and ecosystem, coupled with our global distribution network and strong Asian footprint, will enable us to work with the NZ exchange to fuel growth in the dairy derivatives market."

The NZ bourse launched its dairy derivatives market in 2010, and has since grown it to include eight futures and options across dairy ingredients such as whole milk powder, skim milk powder, butter and anhydrous milk fat, as well as liquid NZ milk price contracts.

The proposed partnership is expected to be confirmed in the first half of next year.

THE BUSINESS TIMES