TEHRAN- Managing director of Iran Mercantile Exchange (IME) said that IME has prepared ten macro plans to improve its performance during the current Iranian calendar year (ends on March 19, 2020).

Hamed Soltani-Nejad made the remarks in the meeting of IME shareholders on Monday, IME Public Relations Department reported.

The IME managing director mentioned development of underlying assets through existing instruments, development of financial instruments for commodity-backed securities, expansion of market size and depth, increasing cooperation with other organizations, and strengthening IME brand as some of the mentioned macro plans.

Soltani-Nejad has previously announced that IME accounted for 39 percent of the value of the total trades in the Iranian capital market during the past Iranian calendar year (ended on March 20, 2019).

He put the value of IME trades at 1.78 quadrillion rials (about $42.3 billion) in the past year, IRNA reported.

The value of trades at IME rose 52 percent in the past calendar year from its previous year.

Over 24.84 million tons of commodities valued at 884.3 trillion rials (about $21.05 billion) were traded at the physical market of IME, showing seven percent fall in the amount and 77 percent rise in the worth of trades year on year.

Applying new financial instruments in Iranian capital market was one of the achievements of the country’s’ exchange markets during the past year. 

In this due, IME launched “option” in early March 2019 in an approach to diversify financing methods for agricultural products.

Option is a contract which gives the buyer (the owner or holder of the option) the right, but not the obligation, to buy or sell an underlying asset or instrument at a specified strike price prior to or on a specified date, depending on the form of the option. 

Iran Mercantile Exchange was established on September 20, 2007 in accordance with article 95 of the new law of the securities market of the Islamic Republic of Iran and following the merger of the agricultural and metal exchanges of Tehran.

Various sectors of economy and national industry benefit from the exchange operation.

Performing as the first market providing access to the initial offering of the listed commodities, IME offers price discovery and price making for the OTC, secondary markets and the end users.

It provides venue for government sales and procurement purchases, offers clearing and settlement services, in addition to risk management, while it also trains the market participants.

As this exchange is a proper platform for price discovery, and given that supplying basic goods is one of the major issues on the Iranian government’s agenda in the current Iranian calendar year (started on March 21) and it is one of the focal pillars in the national budget bill for this year, many capital market experts believe that offering basic goods at Iran Mercantile Exchange can help the government regulate and control the market in a better way.

In an interview recently conducted by IRNA, Hossein Khezli Kharazi, a capital market expert, said, “Mercantile exchange was set up in our economy with the aim of fair price discovery. The best way for discovery of the fair prices of basic goods is relying on a supply-demand mechanism and IME is the only transparent market for this purpose.”

MA/MA