Published On: Thu, Nov 17th, 2011

DCE President: Oils and Oilseeds Futures Gain in Maturity

“The investment structure and operation mechanism of oils and oilseeds futures market is changing as the participation of industry clients and institutional investors increases, indicating oils and oilseeds futures listed on Chinese market are gradually gaining in maturity and influence,” said President & CEO Liu Xingqiang of the Dalian Commodity Exchange (DCE) in his speech at the 6th China International Oils and Oilseeds Conference (CIOC) kicked off on November 12 in Guangzhou.

Among five out of the six oils and oilseeds futures listed in China, No. 1 Soybeans, No. 2 Soybeans, Soybean Oil, Soybean Meal and RBD Palm Olein are traded on the DCE, accounting for over 60% of the DCE’s total trading volume, said Liu.

Sticking to the principle of serving national economy and industry, the DCE has been making earnest efforts in recent years to train and serve companies from relevant sectors, attracting companies’ attention on and participation in futures market. So far, the number of corporate clients involved in the oils and oilseeds futures trading at the DCE totals over 9,800, or 2.3 times of 2006. The percentage of oils and oilseeds futures position held by corporate clients reaches 65% from an average of 51% in 2008.

With the increase of industry clients and institutional investors, the investment structure and operation mechanism of oils and oilseeds futures market is changing with two highlights. For companies and investors, arbitrage of oils and oilseeds futures has become a common tool. A total of 24.14 million lots of arbitrage trading transactions have been made by 4,377 clients this year. Besides, foreign-invested companies are actively involved in the Dalian futures market. The percentage of open interest by companies with foreign background of soybean, soybean oil, soybean meal and RBD Palm Olein is around 30%, 30%-45%, 40%-60% and 50% on average respectively in 2011.

That means the oils and oilseeds futures listed in China are growing in maturity and generating market influence, and the DCE is winning attention from oils and oilseed sectors worldwide.

Jointly held by the DCE and the Bursa Malaysia Derivatives for five years, CIOC, with industry clients making for over 70% of its participants, is now a platform for companies and investors from relevant industries both at home and abroad to access information and investment opportunities in international oils and oilseeds market.

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