Commodity trading on the BSE is booming

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The aim of the Budapest Stock Exchange (BSE) was to significantly strengthen its position in the commodity market, therefore, in cooperation with Equilor Befektetési Zrt., It restructured the rules of its commodity section.

A solemn ringing on the Budapest Stock Exchange on Thursday signaled the beginning of a new era in the commodity market section. The goal of the BSE and Equilor Befektetési Zrt., Which is currently the only player in the commodity market,

to make the Hungarian stock exchange one of the central players in the Hungarian and regional agricultural world again.

The new trading conditions came into force in January, and the experience of the first months shows that traders are turning to commodity market opportunities in increasing numbers and with interest.

Commodity exchange trading has a long tradition in Budapest: the first one was opened before the unification of the city, and then the Budapest Commodity and Stock Exchange was established by merging with the stock exchange, which became the second largest such platform in Europe in the 20th century. to the beginning of the century. After the closure in 1948, the Budapest Commodity Exchange was established again in 1989 as an independent institution, where trading was very active in the 1990s, and then in 2005 the two exchanges were merged again.

Richárd Végh and Bálint Szécsényi at the ceremonial ringing
Photo: BSE

In recent years, the volume of trading has decreased, the importance of the commodity section has shrunk, so now the trading has been restructured: the changes affect, among other things, the range of tradable products and the rules of trading and delivery (physical performance). The range of tradable products was narrowed to six futures products. Five previously available to investors, with these product features and rules redesigned since January 18, will continue trading. These include high oil sunflower seeds, sustainable high oilseed rape (formerly high oilseed rape), feed barley, sustainable feed wheat (formerly feed wheat) and sustainable feed corn (formerly feed maize). In addition to these five products, Eurobut futures have been newly introduced.

The system of rules for trading and physical performance (delivery of goods) has changed at several points. The list of settlement points and geographical locations of the transactions has been expanded, as a result of which

crops produced in the country can more easily engage in commodity trading.

The timing of stock exchange trading has changed, adapting to the opening hours of larger foreign commodity exchanges. The French stock exchange opens at 10.45 and the Chicago market at 15.30, so the free trading period on the BSE takes place between 11 am and 4 pm, with the closing stage in the next five to six minutes.

Following the changes in January, the market began to pick up in February, with stores focusing on feed corn for the first time. By April, the turnover of sunflower seeds and fodder barley had also increased. Currently, there are 11 open-end bond stocks in the three products, the distribution of turnover so far is as follows: feed corn 63 percent, sunflower seeds 31 percent, and feed barley accounted for the remaining six percent.

Bálint Szécsényi, CEO of Equilor, said that Hungarian agriculture is a significant engine of the economy, and just as a strong economy does not exist without a strong capital market, a strong agriculture cannot exist without strong commodity trading. According to Richárd Végh, CEO of the Budapest Stock Exchange, an increasing number of participants may appear in the section as stock exchange members and traders in the coming months, so that the commodity market can once again play a role in stock exchange trading.

Source: Magyar Nemzet by

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