Wheat Future Contracts with physical delivery through Electronic Warehouse Receipts will be launched upon signing of a cooperation agreement between Borsa İstanbul and Konya Commodity Exchange on February 25, 2016 in the presence of H.E. Ahmet Davutoğlu, Prime Minister of Turkey. Within the context of this cooperation, Turkey will offer local and international investors the opportunity to trade wheat future contracts with physical delivery, similar to developed countries with advanced capital and commodity markets.
The agreement aiming at further enhancement of the existing cooperation between Borsa İstanbul and Konya Commodity Exchange will be signed at Konya Commodity Exchange premises on February 25, 2016 in the presence of; H.E. Ahmet Davutoğlu – Prime Minister of Turkey, M. Rıfat Hisarcıklıoğlu – President of The Union of Chambers and Commodity Exchanges of Turkey (TOBB), Talat Ulussever, Ph.D. – Borsa İstanbul Chairman, Tuncay Dinç – Borsa İstanbul CEO, and Hüseyin Çevik – Konya Commodity Exchange Chairman.
Through the close cooperation that has been building momentum for a while, the goal is to increase the liquidity of physically delivered future contracts with grains and especially wheat as the underlying asset and in this way, to provide a risk management tool for the producers, traders, and real sector companies. Deepening of the market through increased liquidity will be quite beneficial for Konya Commodity Exchange, for Borsa İstanbul and for the Turkish economy as a whole. Konya Commodity Exchange will become an important stakeholder in the commodity products and services arm of the Istanbul International Financial Center strategy.
National and international investors are expected to show keen interest to wheat future contracts to be launched as part of this cooperation agreement. Wheat future contracts with physical delivery will be launched for the first time in Turkey, which would provide increased international prestiege and market depth to Turkish capital and commodity markets and a low cost financing alternative to producers.
Within the framework of the agreement between Borsa İstanbul and Konya Commodity Exchange, the expiry months of the Wheat Future Contracts with Electronic Warehouse Receipts, will be February, May, July, and September. The contracts will be closed out with the delivery of Electronic Warehouse Receipts through transactions at Konya Commodity Exchange. The cooperation agreement also covers sharing of data and cooperation in surveillance operations between the two exchanges. In this way, the interaction between derivatives and spot markets, price, trade volume and investor movements will be monitored collectively by the two exchanges and any disruptive movements will quickly be detected and prevented.
