Published On: Fri, Nov 19th, 2010

DCE and China Coking Industry Association Sign Agreement

On November 17th, the Dalian Commodity Exchange (DCE) and China Coking industry Association (CCIA) signed a cooperation agreement at the Dalian Futures Tower. The agreement aims to strengthen bilateral communication and cooperation, jointly promote coke futures research and development, and service related industry development. DCE President Liu Xingqiang and CCIA President Huang Jingan represented their organizations at the signing ceremony. DCE Vice Presidents Guo Xiaoli and Wang Fenghai, Assistant President Liu Zhiqiang and CCIA Advisor Yang Wenbiao also attended the ceremony.

At the signing ceremony, DCE President Liu Xingqiang stated that in recent years, the DCE has quickened the pace of its development, as well as gradually transformed from a regional, agricultural futures exchange into a national, comprehensive futures exchange. The exchange has also gradually developed a three-product system including agricultural, oils and oilseeds, and plastics products. The DCE is now the world’s third-largest agricultural futures exchange, and the largest oils and oilseeds exchange and plastics exchange. In order to broaden the futures market in the area of real economy services, the exchange is working hard to maintain existing products, while at the same time working to expand its product offerings into coke and other energy-related areas.

Mr. Liu said that the CCIA is an important bridge between coking enterprises and related government offices. Over the years the DCE and CCIA have maintained good relations, and their cooperation projects have achieved fruitful results. In particular, the CCIA has offered its support and assistance to the DCE in developing new products such as coke, and also in developing market training. China’s futures market has currently entered a period of healthy and sustainable development, its economic functions are increasingly moving on a healthy course, and has the capacity to service national economic development at a higher level. Faced with a good futures market and national economic development situation, the DCE and CCIA have seized the opportunity to take their relationship to a new level and bringing forth a broader vision and pragmatic spirit.

CCIA President Huang Jingan said at the signing ceremony that the scale of production in the domestic coking industry is currently very large. Coke production capacity, exports and consumption have long ranked first in the world. There are nearly 1,000 coke production enterprises in China with total output over 300 million tons. This product is widely used in iron and steel, nonferrous metallurgy, chemicals, machinery casting, and other domestic economic areas. China has basically developed the world’s most complete and uniquely Chinese coking industry system, and it is one of the important industries supporting the rapid development of the domestic economy. However, the coking industry’s supply chain is long, and the number of independent firms is large; the market is intensely competitive, prices fluctuate frequently and the risks to business are many. There is an urgent need for price discovery, risk prevention and hedging mechanisms in the coking industry. The coming listing of coke futures will provide effective hedging tools, as well as promote the industry eliminating backwards practices, mergers & acquisitions, organizational restructuring and industry upgrading. It will also strengthen the industry’s right to speak in the market, enhance production and operation initiatives, and improve the economic efficiency of firms.

According to the agreement, both parties will promote the development of coke futures research, as well as service the risk prevention and hedging needs of firms. The two sides will also jointly research the establishment of coke futures delivery warehouses and jointly promote coke futures market education and development, including an agreement to hold a steel-coke-coal industry chain conference. Finally, they will also establish effective communication and networking mechanisms.

After the signing ceremony, the DCE held a lecture related to the coking industry. CCIA President Huang Jingan and Advisor Yang Wenbiao lectured on the coke market situation, national industry policy, and coke production and applications.

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