August 25, 2017 / 8:09 AM / 4 months ago

UPDATE 1-New Singapore bourse eyes metals, rubber after palm olein launch - sources

* Apex to list palm olein contracts in Q4 2017

* Is considering launching rubber and metals contracts (Update with MAS comment in fifth paragraph.)

By Emily Chow

KUALA LUMPUR, Aug 25 (Reuters) - Asia Pacific Exchange Pte (Apex), Singapore’s newest derivatives bourse, is targeting a fourth quarter 2017 launch for its palm olein contract and is considering rubber and metals contracts for future listings, according to two sources closely linked with Apex.

The company recently received in-principle approval from the Monetary Authority of Singapore (MAS) to form Singapore’s third derivatives exchange after Singapore Exchange Ltd and Intercontinental Exchange. Apex is backed by Chinese investors and plans to offer a range of products “related to the Chinese economy,” according to a source with direct knowledge of the matter.

“Apex is targeting international traders who want exposure which is correlated to China’s economy, and also Chinese traders who face restrictions when trading onshore,” said the source. All products will be denominated in U.S. dollars and offer physical delivery.

Eugene Zhu Yuchen, a former chief executive officer of the Dalian Commodity Exchange and president of the China Financial Futures Exchange, is listed as an officer of Apex in Singapore corporate filings.

Apex officials in Singapore declined to comment. MAS said in a statement it does not comment on its dealings with individual parties.

Apex aims to launch palm olein contracts before the end of 2017, with physical delivery in Malaysia or Indonesia, according to the source.

Apex on Aug. 17 changed its name from Asia Investment Pte Ltd.

Palm oil comprises more than 70 percent of China’s edible oil imports of about 5 million tonnes a year. The country is the world’s second-largest palm oil buyer after India.

The tropical oil is the world’s most consumed edible oil, and is used to produce everything from food products and cosmetics to biodiesel. When crude palm oil is refined it forms palm olein, a liquid edible oil, and palm stearin, a solid fat.

Crude palm oil futures are most widely traded on the Bursa Malaysia Derivatives Exchange, and those prices are considered the global benchmark. Indonesia and Malaysia account for over 85 percent of the world’s palm oil production.

The Apex exchange would consider rubber futures as well as metals products after launching the palm olein contract, the source said, asking not to be identified as he was not authorised to speak to the media.

Aside from Zhu, other Apex officers listed include Wong Chong Fatt, former head of CME Group Inc Asia, and Tan Tock Siong, formerly with the Singapore Mercantile Exchange which was acquired by ICE in early 2014.

Shareholders include Asia Pacific Holdings Pte Ltd and Chaos Investment Ltd, a hedge fund and futures brokerage with offices in Shanghai and Hong Kong. (Reporting by Emily Chow; Editing by Gavin Maguire and Kenneth Maxwell)

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