U.S. Experts Bring Uzbekistan's Commodity Brokers Up to Global Standards
On 25 June, the Uzbek Commodity Exchange (UZEX), together with the Commercial Law Development Program (CLDP) of the U.S. Department of Commerce, held a practical seminar on the introduction and development of futures trading in Uzbekistan.
The event brought together brokers, traders, business representatives and other exchange market participants. Its main objective was to introduce participants to international best practices in organising derivatives markets and applying hedging instruments.
The seminar was led by Kevin Piccoli, CLDP international expert on futures markets and former Deputy Director of the U.S. Commodity Futures Trading Commission (CFTC).
The expert presented international experience in the development of derivatives markets and risk management, as well as the key elements of infrastructure that ensure the reliability and efficiency of futures trading.
It was noted during the event that futures contracts are among the most important instruments of a modern market economy, enabling producers, exporters and consumers of commodities to reduce the impact of price volatility, improve the quality of financial planning and ensure business resilience.
The practical part of the training covered the mechanisms for hedging price risks, the procedure for concluding and executing futures contracts, initial and variation margin requirements, and the procedures for opening, maintaining and closing positions.
Participants also examined international regulatory and compliance standards, including Know Your Customer (KYC) procedures, segregation of client assets, financial soundness requirements for market participants, record-keeping and supervision of trading activity.
In addition, separate attention was given to providing domestic entrepreneurs with access to international commodity derivatives markets and to building an effective price-risk hedging system for commodity market participants through UZEX Global, the joint venture established by UZEX together with Phillip Capital.
The experts emphasised that, amid high volatility in global commodity markets, hedging instruments are becoming an essential element in safeguarding the financial stability of companies.
The creation of modern risk management infrastructure will enable domestic producers and exporters to improve operational efficiency, reduce the impact of market fluctuations and strengthen their competitive position in international markets.
The discussions also addressed the prospects for developing the derivatives market in Uzbekistan, further improving exchange infrastructure and expanding opportunities for businesses to use modern exchange-traded instruments.
The seminar marked another important step in implementing UZEX's strategy aimed at creating an efficient derivatives market in Uzbekistan and introducing futures trading and advanced international practices in price-risk management.
