Singapore Exchange (SGX) and New Zealand’s Exchange (NZX) have signed a strategic partnership agreement to unlock and accelerate the growth potential of NZX’s dairy derivatives on April 8.
The partnership marries the capabilities of both exchanges to scale up market distribution and liquidity to unlock growth in the global dairy derivatives markets.
The agreement will take effect in 2H2021, subject to regulatory approvals.
As part of the new partnership, NZX intends to delist its suite of dairy derivatives contracts from the NZX Derivatives Market. Equivalent contracts will be relisted on the SGX.
Market participants can expect augmented access via new trading and clearing channels, according to the joint statement put out on April 8.
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The agreement follows a Heads of Agreement that was signed by both exchanges in October 2020. The October agreement explored the listing of NZX’s dairy derivatives contracts on SGX’s trading and clearing platforms.
“This partnership combines the strengths of SGX and NZX and we are very excited to see it coming to fruition. With Asia representing the world’s largest bloc of dairy consumers and producers, this partnership brings a world-class suite of dairy derivatives benchmarks and risk management tools to dairy participants and investors in Asia and beyond. We look forward to continue working with NZX to grow the dairy derivatives market and benefit the wider industry,” says SGX CEO Loh Boon Chye.
NZX will continue to provide dairy product development expertise, market research and product support for new developments and enhancements. NZX will also continue to lead engagements with the dairy industry, says NZX chief executive, Mark Peterson.
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“We see huge opportunity through this partnership to unlock potential and propel future growth of our dairy derivatives suite. By working together, we can leverage SGX’s global market connectivity, strong Asian presence and international distribution, to scale growth and liquidity in the trading of dairy derivatives,” Peterson adds.
Shares in SGX closed 7 cents higher or 0.7% up at $10.03 on April 8.
