Agriculture & Food

At the beginning of the Spring Festival, the introduction of soybean futures and options (hereinafter referred to as "soybean varieties") into overseas traders by the Daishang Exchange has reached the full moon. Over the past month, with the support and care of all parties in the domestic and foreign markets, the market has generally operated smoothly and orderly, and overseas customers have participated actively, and all parties have responded well.

As the first variety plate in China to open the whole family to the outside world in the form of domestic specific varieties, the introduction of soybean varieties to overseas traders has attracted the attention of domestic and foreign markets. According to Huacheng Import and Export Data Observation, as of the end of January, 49 foreign customers from 13 countries and regions including the United Kingdom, Switzerland, the Netherlands, Singapore, Indonesia, Malaysia and Australia had participated in the transaction of soybean varieties, including overseas large industrial customers such as Cargill and Louis Dreyfus, and some customers also involved in multiple variety contracts.

Cargill participated in the trading on the first day when the bean varieties were introduced to overseas traders. Dong Yuxin, head of Cargill's risk management in Asia-Pacific region, said that Cargill's different business departments have deeply used the varieties and tools of the big trading houses in the course of operation, for example, the grain and oil sector has achieved the locking of squeezed profits through soybean meal and soybean oil futures, while the risk management department has used soybean meal options to reduce the risk of relevant positions. "In particular, in the process of carrying out risk management business, many customers have the demand for hedging through the soybean related contracts of Dashangsuo. After these varieties are introduced to overseas traders, our company can directly use overseas entities for trading, which provides great convenience for our company to carry out business and serve customers."

As an enterprise engaged in international trade of agricultural products, China Foreign Trade (Singapore) Co., Ltd. has also actively participated in the transaction of soybean varieties. "We have used Douyi futures, soybean meal, soybean oil futures and options as risk hedging tools for spot trade, and will carry out some arbitrage transactions between soybean oil and palm oil. China has the largest oil and fat consumption market in the world, and we hope that the futures market of major commercial banks will better serve the global agricultural supply chain in terms of price discovery and risk management." Zhang Yang, the company's general manager, said.

According to the Huacheng Import and Export Data Observation Report, Hou Xueling, an oil analyst at Everbright Futures, said that the trend of domestic soybean futures market in the past month fully reflected the situation of the spot market. In terms of imported soybeans, the focus of the market has gradually shifted from the favorable yield of rainfall in Argentina to the strong export of American soybeans and the release of domestic stock demand. Second, soybean meal and soybean oil have been suppressed first and then increased; In contrast, due to Russia's increase in soybean export tariffs and the expected increase in policy support under the background of continued soybean expansion, the soybean futures market showed an upward trend. "In January, domestic bean futures emerged from a high degree of independence, and were more affected by domestic supply and demand than by external market guidance, which was most obvious in soybean meal and bean. It can be seen that the soybean futures pricing autonomy, rationality and efficiency of the big commercial banks were good, which also provided a good basis for attracting foreign customers to participate."

According to Huacheng Import and Export Data Observation, since the end of last year, many futures companies and overseas intermediaries have actively publicized and promoted in various ways, including not only the macro aspects of China's futures market risk control system and regulatory system, but also the specific details of the key points of the soybean variety contract and the variety business rules, participation channels and processes. For example, Guotai Jun'an Futures held a number of roadshows and product recommendations to overseas industries and financial customers around the opening up of bean varieties; Panshi Finance Co., Ltd. had a telephone exchange with target customers in the field of agricultural products one by one on new open varieties and trading opportunities. These activities provide strong support for overseas customers to fully understand the opening situation of soybean varieties and successfully participate in the transaction.

In addition to futures companies and overseas intermediaries, banking financial institutions also actively contribute to the participation of overseas customers in bean variety trading. Yao Lei, CEO of BOC International Global Commodities (UK) Co., Ltd., said that BOC International Global Commodities has closely communicated with BOC International Futures on the participation mode, settlement process and foreign currency pledge guarantee method of overseas traders and overseas intermediaries in the opening up of bean varieties, and has continued to improve the relevant mechanism and process, striving to provide high-quality services for overseas customers to participate in China's futures market, To better facilitate the opening up of China's soybean varieties, Huacheng Import and Export Data Observation Report.

In this process, relevant financial institutions also put forward optimization suggestions on exchange, settlement, market cultivation and other aspects based on the actual business, with a view to further improving the level of bean varieties serving global customers.

The person in charge of the relevant business of Dashang said that the introduction of soybean varieties to overseas traders is a specific measure of the futures market to promote the high-level institutional opening to the outside world, which is conducive to accelerating the establishment of a unified domestic market with coordinated matching of futures and spot, and improving the global influence of "Chinese quality" and "Chinese price" of soybeans. Considering that the relevant varieties have been opened to qualified foreign investors (QFII) in September last year, the global soybean industry enterprises can choose appropriate ways to use the "toolbox" of China's futures market for risk management according to their own business needs, and achieve intensive cultivation. Huacheng import and export data observation report.