EghtesadOnline: On the First Iran Bitumen and Asphalt Forum 2016, CEO of Iran Mercantile Exchange (IME) announced that the IME is about to launch future contracts and CDRs for bitumen.
According to the report by the IME’s International Affairs and PR, on Tuesday, August 30th, the first day of “Iran Bitumen and Asphalt Forum 2016” held by Conference Connection and sponsored by Jey Oil Refining Company and Pasargad Oil Refining Company, Dr. Hamed Soltaninejad explained the the IME’s programs to launch trading bitumen in futures contracts.
Presenting a brief overview of futures contracts for trading bitumen on export pit of the IME, he added irritated that launching futures contracts for bitumen to hedge the market participant for this commodity is amongst the IME’s programs to develop trading of the commodity, reports ISNA.
Pointing to necessity of futures contracts for bitumen due to price fluctuations, Soltaninejad said that fluctuating prices entail launching risk management instruments and the most important factor to launch futures contracts for bitumen is to enhance the spot market of the commodity. Furthermore, we have put issuing the CDRs for the bitumen to increase liquidity of the market high on our agenda.
CEO of the IME explained that we launch the CDRs for the bitumen in order to provide a continual price and to achieve this goal bitumen suppliers should allocate some of their production to drums. On the other hand, by launching CDRs and entering the investment institute to the market, the liquidity of these securities will be increased.
Highlighting the challenges of warehousing in the bitumen industry, Soltaninejad said that today most of the suppliers deliver their commodity in bulk, while in order to implement bitumen CDRs and to store the commodity in accordance with determined standards the suppliers should deliver their commodity in drums.
At the end of presentation, the CEO of the IME pointed to the international market participants in the industry and said that the IME needs to tap into other financial entities’ experiences to launch successful futures contracts for bitumen. Hence, any propositions are welcome by the IME.