Dalian Commodity Exchange improves the construction of futures market, implements the spirit of Central No1. Document and thus achieves new breakthrough in constructing the futures and option market of agricultural commodity, promoting new varieties and conducting pilot experiment of “insurance plus futures”.
In 2016, Dalian Commodity Exchange obtained the synchronous improvement of market size and quality focusing on serving real economy, achieving the futures trading volume of 1.537 billion lots worth 61.41 trillion yuan (unilateral), with a year-on-year growth of 37.73% and 46.43% respectively, which laid a solid foundation for innovation and development of the market.
As to the construction of agricultural commodity option market, the bean pulp option was approved to be listed on the market by the State Council, which shows a great progress in 2016. Currently, preparation work has been practically promoted in accordance with the principle of “stable operation and strict risk control”. The bean pulp option will be the first exchange-traded option in Dalian Commodity Exchange, which serves as a more flexible and various risk management tool based on bean pulp futures. Dalian Commodity Exchange will accelerate its efforts to study corn option and make full preparations.
Dalian Commodity Exchange promotes the construction of agricultural commodity futures market in both exploring new futures varieties and maintaining old ones, such as live hog futures, urea and whole milk powder, so as to form a complete risk-avoiding industry chain integrating raw material, feed and breeding.
Dalian Commodity Exchange improves the contract rules of marketed products like No.2 Soybean Futures. Besides, such systems as the innovation of corn futures group delivery and the improvements of soybean oil terminal layout have also been studied.
In 2016, Dalian Commodity Exchange conducted 12 pilot projects concerning “insurance plus futures” at Heilongjiang, Jilin, Liaoning, Inner Mongolia and Anhui Province together with 12 futures companies and 7 insurance companies, which can help farmers avoid the risk of price drop through risk hedging tools and market-based means.
Opinions on Promoting Structural Reform of Agricultural Supply Side, Accelerating the Development of Agricultural and Rural Development by CPC Central Committee and the State Council has been released, aiming to deepen the construction of futures and option market of agricultural commodity, guide agricultural enterprises to control market risk through futures and options, and expand the pilot scope of “insurance plus futures”. Responsible persons of Dalian Commodity Exchange noted that the Central No1. Document incorporates the construction of derivatives market, which shows the irreplaceable role of agricultural commodity derivatives in structural reform of agricultural supply side. Dalian Commodity Exchange will strive to enhance the capability of serving “agriculture, farmer and rural areas” and improve the effectiveness of serving the real economy in conformity with the spirit of Central No1. Document.