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Takamichi Hamada, President & CEO
Brexit has become a reality and global financial markets are in turmoil. The world economy is increasingly uncertain and is experiencing continued weakness in production and exports. Emerging economies, oil producers and other resource producing countries dependent on resource production have falling revenues and are stagnating. Such instability places Japan’s Abenomics-led recovery in a less certain position.
At TOCOM, continued initiatives to reinvigorate the market have started to show results. For example, trading in Dubai Crude Oil futures expanded significantly and Gold Rolling Spot futures became one of the most heavily traded commodities at TOCOM in its first year of trading. Crude Oil futures benefitted from active trading of an ETN based on TOCOM Dubai Crude prices. The new gold contract is meeting the needs of retail investors.
We aim to build on these successes and transition to a solid recovery. To this end, we will focus on implementing the following initiatives to improve market liquidity, expand exchange functionality and solidify of the business.
Firstly, we are working towards the smooth implementation and launch of a next generation trading system, in conjunction with JPX, in September. We will capitalize on the joint-use of the platform to support the entry of financial investors to TOCOM.
Secondly, we intend to launch an electricity futures contract following the liberalization of the electricity market in April 2016. The new contract is designed to attract new market participants from the commercial sector, as well as investors. It will offer a risk hedging product to the power industry. Simultaneously, we continue research into new energy products such as LNG, LPG and coal, in preparation for a comprehensive energy market.
Thirdly, TOCOM is striving to expand business to include OTC and physical commodity markets to create a “Comprehensive Commodity Market.” This would support the price discovery function.
Finally, we are expanding our marketing to retail investors with “TOCOM Square”, a new customer relations facility and channel for distributing commodity futures market information. TOCOM Square is operated in cooperation with related associations and exchange members. Our promotion efforts will include reaching out to Chinese and other Asian retail investors.
TOCOM is a privately-held company that has an important public mission. We shall continue to do our best to provide an indispensable component of Japan’s economic infrastructure, while strengthening the commodity market through the steady implementation of the aforementioned initiatives and related action plans.
I am looking forward to your continued support and cooperation.
Takamichi Hamada
President & CEO
Tokyo Commodity Exchange, Inc.
