Ran Hua: Promote the high-quality development of the coal, coking and steel industry with specialized, refined, and characteristic futures services |

Original title: Ran Hua: Promoting the high-quality development of the coal, coking and steel industry with specialized, refined and characteristic futures services

On September 28, the “20th China Iron and Steel Raw Materials International Symposium” initiated by the China Iron and Steel Association (hereinafter referred to as “China Iron and Steel Association”) and hosted by the Metallurgical Industry Branch of the China Council for the Promotion of International Trade was held in Dalian. Ran Hua, Secretary of the Party Committee and Chairman of the DCE, attended the meeting and delivered a speech. He said that with the support of China Iron and Steel Association and the industry, DCE will use market innovation and first-line supervision as the starting point, and continue to create more professional, finer, and more distinctive futures services for the coal, coke and steel industry and citizens. Make new contributions to high-quality economic development.

Ran Hua said that, as an important financial infrastructure of the country, in recent years, DCE has been adhering to the concept of “services oriented to the real economy, innovation to keep up with market demand”, and has solidly promoted futures with product innovation, technology drive and ecosystem construction as the main line. After nearly 28 years of development, the construction of a world-class derivatives exchange with spot integration, on- and off-exchange collaboration, and domestic and overseas connections has become a major global derivative exchange.iron oreStone, coal,plasticAnd the agricultural futures market. In 2011, the world’s firstCokeThe listing of futures opened a new chapter for DCE to serve the steady development of the coal, coke and steel industry.In the past ten years, DCE One has been listed one after another starting from coke futuresCoking coalFutures, iron ore futures and options have realized the opening of iron ore futures trading, and initially formed a complete risk management tool chain for the coal, coking and steel industry. The second is to focus on promoting the synergy between inside and outside the exchange, successively launching the business of warehouse receipt trading, basis trading, swap, and over-the-counter options of coal and coking ore in the over-the-counter market, establishing a black-sector product ecosystem, and carrying out price information cooperation with spot platforms. A new pattern of on- and off-market collaborative service industry risk management has been initially formed. The third is to continue to deepen the form of industrial services, promote the “DCE Enterprise Risk Management Plan”, the industry and finance cultivation base, and the “DCE·Industry Bank” projects to encourage and guide coal, coking and steel enterprises to comprehensively utilize on-site options, off-site options and base options. Risk management of derivative instruments such as poor trade. Through the effective development of the above-mentioned work, in the past two years, the coal and coking ore futures market has achieved rapid development in the continuous integration with the physical industry. At present, there are over 10,000 corporate clients participating in coal and coking ore futures transactions, of which more than 100 listed companies participate in iron ore futures transactions. Basis trading based on iron ore futures prices has been developed in the raw material procurement of the steel industry. In application, major international mines have also begun to try to use iron ore futures prices to carry out trade pricing. Although a large number of industrial enterprises have not participated in futures transactions, they are using and referring to futures prices to guide production and consumption.

Ran Hua introduced that, on the basis of enriching derivatives, improving market systems, and deepening industrial services, in recent years, DCE has made great efforts to improve the operation quality of the futures market, strengthen the front-line supervision of the market, and ensure the effective functioning of the futures market. Specifically, in terms of improving the quality of market operation, based on the characteristics of varieties and the changes in the spot market, DCE has launched the “one product, one policy”, and optimized measures with different dimensions and different combinations for different varieties, which have achieved good results. Regarding iron ore futures, DCE takes the increase of delivery resources as its guiding ideology and adjusts the delivery rules and systems. In response to the sharp fluctuations in the price of iron ore in the past year, the unstable price difference between brands, and the gradual decline in the grade of imported iron ore, DCE has kept pace with the times and listened carefully to the voice of the industry, and made recommendations on the iron ore contract and delivery system. Major adjustments have been made: the iron grade of delivery standard products has been lowered to 61%, the dynamically adjusted iron indicator up-and-down system has been introduced, quality has been optimized, and brand premiums and discounts have been optimized; implementation of rolling delivery, reduction of delivery fees, increase of delivery brands, and addition of delivery Factory warehouses, etc., in order to reduce delivery costs and facilitate industrial customer participation; continue to optimize the market maker system and continuously improve contract continuity. At present, the deliverable resources of iron ore have increased. Under the condition of high transaction costs, the positions of corporate customers have increased significantly, the spot price spreads are more reasonable, and monthly delivery is basically realized. The liquidity of non-mainstream contracts and the bid-ask spreads have improved significantly. For coal and coke futures, DCE has optimized the coking coal and coke delivery quality standards in advance according to changes in the trade pattern, adjusted the premiums and discounts for coal and coke in Shanxi, and moved the coke port to the production area at the beginning of the year to protect the coal and coke market. Plan ahead for smooth operation.

In terms of strengthening market supervision, DCE has always had the “two overall situations” in mind and the “big one of the country” in mind. It has always stood firm on the people’s and entities’ position, played the role of front-line supervision, strictly managed the market, and proactively adopted decisive measures in a timely manner to promote The market operates steadily and rationally, and effectively serves to ensure the supply and price stability of bulk commodities. Facing the rapid increase in the spot price of iron ore futures in the second half of last year, in addition to continuously optimizing contract rules and the layout of the delivery warehouse, DCE actively cooperated with the supervision of futures and cash, and adopted a total of 15 risk controls on iron ore varieties. Measures to resolutely curb the overheating of market transactions. In the first eight months of this year, the cumulative trading volume of iron ore varieties was 88 million lots, down 51% year-on-year, and trading enthusiasm dropped significantly. At the same time, in the face of the sharp rise in the spot prices of coking coal and coke futures since the end of July this year, DCE has increased the transaction margin level six times, tightened transaction limits and increased transaction fees twice, and successively introduced additional delivery warehouses and adjustments in delivery locations. Measures such as premiums and discounts. Since September, the transaction volume of coking coal and coke varieties has fallen by 60% compared with August, which has played a positive role in cooling down and stabilizing the market.

Looking forward to the future, Ran Hua pointed out that DCE will continue to do a good job in the linkage between the future and the present to serve the long-term development. On the one hand, focus on business innovation, steadily promote the listing of recycled steel raw material futures and the internationalization of iron ore options, continuously improve the contract rules for iron ore, coking coal, and coke, and accelerate the study of iron ore average price settlement futures contracts; another On the one hand, strengthen market supervision, fully cooperate with future-to-current joint supervision, continue to strengthen market supervision and macroeconomic research and judgment, adhere to “zero tolerance” and strictly manage the market, resolutely prevent overheated transactions in the market, and severely crack down on illegal activities such as market manipulation to ensure futures Prices objectively and rationally reflect the relationship between supply and demand.

“DCE iron ore futures are based on physical delivery, which can better reflect the relationship between supply and demand and realize the return of futures. It is hoped that all parties in the society and the market can correctly understand and rationally use the role of futures market price signals, and continuously adjust industrial policies, Improve the relationship between supply and demand to make the market more effective and the government more effective. In the new stage of development, let the futures and spot industries implement new development concepts, integrate into the new development pattern, and provide more professional, refined and characteristic services to the futures market. Make new contributions to the high-quality development of the coal, coking and steel industry and the national economy.” Ran Hua said.

The theme of this seminar is “Establishing a Sustainable Resource Guarantee System and Fair Pricing Mechanism”. The Ministry of Commerce, China Iron and Steel Association, China Metallurgical and Mining Enterprises Association, China Scrap Steel Application Association and other relevant government departments and industry associations, as well as Baowu Group, Anshan Iron and Steel Group, Hegang Group, Rio Tinto, Vale, BHP Billiton, FMG, Luo Representatives from domestic and foreign industrial companies such as Yishan gathered to exchange views on the operation prospects of China’s steel industry, raw material procurement strategies for steel companies, price risk management, and derivatives business.