STATE, STRUCTURAL BARRIERS AND A TWO-STAGE MODEL OF ORGANIZED DERIVATIVES MARKET DEVELOPMENT IN UKRAINE

Abstract

The article assesses the state of the organized derivatives market in Ukraine and substantiates a two-stage model of its institutional development. It is shown that the national economy, being one of the world’s leading exporters of grain and oilseeds, manages the price risk of raw-material exports mainly through foreign exchange infrastructure, since the domestic derivatives market remains institutionally underdeveloped. Settlement prices for Ukrainian grain are oriented toward the quotations of global exchanges, so producers accept price signals formed outside the national market without the possibility of hedging on their own platform. The institutional and legal framework, updated by the Law of Ukraine “On Capital Markets and Organized Commodity Markets”, which introduced a modern classification of derivative instruments by settlement method and by type of underlying asset, is analyzed; however, it has not ensured the automatic formation of a liquid market. It is established that organized trading is characterized by the dominance of the spot segment over the derivatives one and by the prevalence of auction mechanisms over contract-based trading. A two-stage development model is substantiated, in which the first stage envisages the launch of cash-settled futures under minimal infrastructural requirements, and the second stage introduces physically delivered contracts with a network of certified warehouses. Structural barriers to market development are systematized according to their institutional-legal, infrastructural, market, and informational-behavioral nature, and tools for overcoming them are proposed. The mechanism of transmission of global price shocks into domestic prices and the stabilizing function of hedging are revealed. The aggregate potential of the derivatives market is estimated by segments of underlying assets, and the prospects for its realization are determined in the context of post-war reconstruction, European integration, and the diversification of sales markets for agricultural products. The proposed sequence of institutional reforms also defines the conditions under which market liquidity, transparent price discovery, and domestic risk-transfer mechanisms can emerge and become sustainable. The study therefore links regulatory capacity, market infrastructure, participant incentives, and physical commodity logistics within a coherent implementation framework for Ukraine.