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SC Media Centre - NPakistan Mercantile Exchange (NCEL)

KPMEX Acknowledges Supernormal Growth and Shows Enthusiasm towards the Agrarian Sector

Karachi: October 3, 2011 – The Board Members of Pakistan Mercantile Exchange (formerly National Commodity Exchange) met to review and approve financial accounts of the year 2010 -2011 and the plans for the next five years here at the head office of the Exchange.

During 2010-11, the traded volumes at the Exchange increased to Rs. 490 bn from Rs. 63 bn in the previous year, a growth of 671 %. The number of new investors grew 245 % during the year as 20 new brokers initiated their business at the exchange and added on new clients. This was a strong signal that more and more investors are entering the Commodity Market for diversifying their investment portfolios and hedging against the uncertainties of the traditional investment markets and the consistently low returns offered by the existing traditional asset classes.

During 2010-11 PMEX successfully placed a Preference Share issue, which was subscribed by the National Bank of Pakistan and Pak Brunei Investment Company. The fact that the shares were taken up by two leading Financial Institutions of the Country serves as a strong vote of confidence that PMEX is on its way to sustained growth and reinforces the fact that PMEX is the fast growing Exchange of the Country. The other shareholders of PMEX include Pak Kuwait Investment Co, Zarai Taraqiati Bank and the three stock exchanges of the country.

Over the last several years PMEX has established a strong footprint in managing and offering international commodities in the Pakistan market - especially gold, silver and crude oil. This trend is expected to continue with the introduction of new products in the coming years.

In the next five years PMEX will also focus on the Agricultural Market development. The main objective will be to initially list all the major domestic agricultural products on the Exchange. This will be followed by an extensive marketing plan to create awareness of the immense benefits that an active futures market offers for the growers and traders and users of agricuotural commodities in Pakistan. This is going to be a major challenge for PMEX as it requires creating awareness of new products and practices to traditional markets. The intention is to follow best international practices in terms of transparency, fairness and open access so that all players in the value chain benefit equally.

In order to achieve the objectives set out, PMEX is planning to open offices near the major agricultural zones of the country for easy access and trust building to take place between the Exchange and the agricultural stake holders. The initial plan is to open 4 offices during 2012 in the approved areas.

PMEX will continue to follow the tight risk management procedures and controls that it has pioneered in Pakistan and that have stood it in good stead, especially in recent times of immense volatility in the international markets.


Pakistan Mercantile Exchange Announces 671 % Growth Year on Year

Karachi: July 6, 2011 – Pakistan Mercantile Exchange Limited completed yet another eventful year in 2010 – 2011. This year brought about major changes and fueled a new growth continuum for the Exchange. The year 2010 - 2011 marked an increase of 671 % from last year. In terms of volume this amounts to Rs 490,515,367,875 in volumes vis a vis Rs 63,610,332,963 last year. The increase in terms of number of lots 1,475,582 were remarkable and stood at a 365 % growth on last years 317,024 lots traded.

We have been growing continuously and consistently over the entire year. During the last quarter the total traded value at PMEX was Rs 211,340,279,318 whereas the KSE closed the quarter at a volume of Rs 189,139,444,428 and LSE and ISE were at Rs 3,425,438,718 and Rs 138,604,723 respectively. With this major spurt in the last quarter of the fiscal year the Mercantile Exchange joined the league of the stock exchanges. This serves as an indicator that PMEX is gaining the confidence of the investors as a trading platform for hedging and for an alternative asset class.

This increasing growth is coming about as a result of newer products, low transaction costs, tight spreads, deep liquidity, growing membership and efficient systems of PMEX that make it very easy for brokers and their clients to transact and manage their trades.

Pakistan Mercantile Exchange, changed its name in March 2011 from National Commodity Exchange to broaden its scope of activity, is now open almost round the clock and growing at a rapid pace with the trading in Gold, Silver and Crude Oil available from 5.00am to 2.00am.

“The name change has been decided with a view to communicating more accurately our mandate as a nation wide commodities and futures exchange. The new name also reflects more accurately the wide variety of our current and planned business lines and products,” said Mr. Samir Ahmed in the press communiqué

PMEX being sensitive to investor needs launched smaller size contracts in Silver and Crude oil in June 2011. Silver Futures is now available in 100 oz along with the existing 500 ounce lot size whereas Crude oil is available for trading in 10 barrel lot size along with the existing 100 barrel lot.

These smaller size lots are introduced in response to the growing demand of investors and medium size players to be able to invest in silver and crude oil as well as the smaller size contracts in gold. Now PMEX has a complete range available for small, medium and large investors to invest in Gold, Silver and Crude Oil futures’ contracts.

Furthermore, whilst working on improving upon the existing and listed products, PMEX has the main Agri futures products in pipeline and plans for launch within the calendar year 2011. Recently, the sugar contract was also approved and it was launched on the 27th of June 2011. It is now available for trading on the Exchange. This listing offers industrial consumers of sugar the option to purchase sugar on the exchange and hedge against price changes. Wheat and Maize contracts are also in the process of being finalized.

The Agri Futures Contracts listing and launch bears good news for the stakeholders. PMEX offers a platform where growers, producers, processors, traders, exporters, importers and investors can trade with ease. By providing a transparent and regulated market, it enables proper price discovery and enables participants to invest and hedge themselves against the price volatility of agriculture and non-agriculture commodities.

PMEX is Pakistan’s first and only demutualised commodity futures exchange. Its shareholders are National Bank of Pakistan, Pak Kuwait Investment Co, Zarai Taraqiati Bank and the three stock exchanges of the country. PMEX currently lists various contracts for trading in Gold, Silver, Crude Oil, IRRI6 Rice, Palm Olein and Kibor.