Bursa Malaysia Derivatives Berhad and Chinese derivatives exchange Dalian Commodity Exchange (DCE) have signed a licensing agreement for a soyabean oil futures settlement price.

Under the agreement, the companies said DCE had authorised Bursa Malaysia Derivatives to use the settlement price of DCE Soybean Oil Futures as the basis to calculate the cash settlement price of its upcoming new product, the Bursa Malaysia DCE Soybean Oil Futures Contract (FSOY).

The agreement marked the first product collaboration between a Chinese derivatives exchange and an Asian exchange based outside of China, the companies said on 2 November.

Following the agreement, the companies said the underlying asset of the FSOY contract would mirror DCE Soybean Oil Futures.

The agreement was signed on 2 November by Bursa Malaysia Derivatives chairman and Bursa Malaysia Berhad CEO Muhamad Umar Swift and DCE CEO Yan Shaoming at the 17th China International Oils and Oilseeds Conference (CIOC) at the Shangri-La Hotel, Dalian, China.

“Through this cooperation, we aim to better serve the international oil and fats industry, facilitate bilateral trade, and contribute collectively to the ‘Belt and Road’ Initiative to achieve mutual benefit and success,” a DCE spokesperson said.

Bursa Malaysia said it was aiming to launch the new product in the first quarter of next year, subject to regulatory approval.