FAS Russia: results of exchange trade in agricultural products in 2023

This was reported at a meeting of the subcommittee of the Exchange Committee of the FAS RUSSIA for the development of organized trading in agricultural products.

This increase in exchange trading in white SUGAR is the result of market participants implementing their voluntary commitments to sell their products on the exchange.

This allows JSC NTB to launch the process of forming a stock exchange index for sugar . Presumably, this indicator will be calculated based on the results of organized sugar trades daily as the weighted average price for each of the three federal districts - the Central Federal District, the Southern Federal District and the Volga Federal District. 

Once the index calculation methods are approved by regulators, it will become the underlying asset for futures contracts. This is planned for approval in the second quarter of 2024 .

Also, at the moment, three over-the-counter indices for white sugar are being formed at JSC NTB: Central Federal District, Southern Federal District and Volga Federal District.

The FAS notes that the volume of exchange trading in sugar is still below the target value and recommends that active measures be taken not only by large market players, but also by independent sugar producers and consumers - industrial enterprises and trade organizations.

The meeting noted the expansion of the range of agricultural products traded on the exchange. For example, such products as margarine,peas , flax, butter , and whole cow's MILK .

This became possible due to the active development of exchange trading in the commodity auction mode at JSC NTB. The features of such trading are low barriers to the introduction of new goods and direct access to trading by market participants. 

“Over the past year, about 600 clients made transactions at commodity auctions. The total volume of trades amounted to about 1.5 million tons of agricultural products worth more than 30 billion rubles,” the FAS cites data.

In addition, in order to stimulate the introduction of new goods on the exchange, the FAS RF uses the instrument of orders based on the results of the review of economic concentration transactions. 

For example, in 2023, following the review of the deal to purchase Rusagro Group assets in the industrial margarine market, the FAS obliged the company to sell at least 10 percent of the products it sells on the domestic market at exchange auctions. As a result, in January 2024, the first auctions of industrial margarine were held at NTB JSC as part of the implementation of the FAS RF order.

At the meeting, the prospects for the start of exchange trading in MEAT and soybean meal in the commodity auction mode were announced.