Commodity derivative volumes up 70% in 2013

Here's what boosted this growth.

Volumes of both OTC and exchange-traded commodity derivatives listed on SGX grew by 70% in 2013, outpacing the global growth of commodity derivatives at 23%.

The largest growth in terms of the number of lots was OTC Iron Ore which grew by 364,838 lots to 584,157 lots. The highest percentage growth was generated by OTC Rubber which grew 278% to 2,778 lots.

In February 2014, SGX also added SGX Hot-Rolled Coil (HRC) Steel Futures and Swaps to its commodity suite.

Last week Bloomberg reported that according to the World Federation of Exchanges (WFE) commodities trading jumped 23% last year. The WFE Report can be found here, while the Bloomberg story can be found here.

According to the WFE the majority of volumes came from the United States and China with “the transfer of cleared OTC energy swaps to futures in the United States by the InterContinental Exchange in 2012 in anticipation of the final Dodd-Frank regulatory requirements, and a 40% increase in volume at Mainland Chinese Exchanges”.

Commodity derivative volumes also climbed signifigantly in 2013, with OTC and exchange traded volumes climbing by 70% to over 1 million lots. The largest growth in terms of the number of lots was OTC Iron Ore which grew by 364,838 lots to 584,157 lots.

Meanwhile the highest percentage growth was generated by OTC Rubber which grew 278% to 2,778 lots. Rubber Futures grew by 35% in 2013, and have continued to see participation pick up pace in 2014, with the contract establishing a recent record in daily volume at 4,275 lots on 11 March.

In total six commodity derivatives experienced a growth in volumes: OTC Iron Ore, Rubber futures, Iron Ore Futures, OTC Oil, OTC Coal and OTC Rubber, while just the one commodity derivative saw volumes declines: OTC FFA. The growth in volumes is tabled and illustrated in the chart below.