Recently, the 2024 Palm Oil and Laurel Oil Price Outlook Conference and Exhibition (POC2024) organized by Bursa Malaysia Derivatives (BMD) was held in Kuala Lumpur, where Ran Hua, Secretary of the Party Committee of the Dalian Commodity Exchange (DMEX) and Chairman of the Board of Directors, attended the conference and delivered a speech. He said that over the past year, the Dalian Commodity Exchange futures market has maintained a stable and improving development trend, especially the continued healthy development of the oilseed and oilseed plate, and the continuous enhancement of the industry's service capacity.
The reporter learned that in the past year, Daxiang Shangxiang insisted on service oriented to the real economy, innovation closely follow the market demand, launched a series of new varieties, new initiatives, new services, market development work to achieve new results. First, the derivatives system continues to enrich the listing of styrene options and ethylene glycol options, to achieve the full coverage of the chemical industry chain futures and options tools, the total number of listed futures, options reached 34, covering grain, oil and grease oils, energy and minerals, chemicals, livestock, forestry and other types of varieties, and at the same time, actively strengthen the integration of the development of the market system both inside and outside the market, and to deepen the personalized and accurate service to the real economy. Secondly, the market opening to the outside world has been deepening, foreign traders in the four varieties of beans futures to participate actively, foreign customers turnover and positions accounted for more than the opening of the initial period continued to rise, the market participation in the structure is further optimized, to better serve the operation of the global agricultural industry chain. Third, the market function has been further brought into full play. On the one hand, it has continued to strengthen market supervision, enhance its scientific and technological supervision capability, and effectively cracked down on all kinds of illegal and irregular behaviors, so as to ensure the safe and sound operation of the market; on the other hand, it has made efforts to cultivate and guide industrial enterprises to reasonably utilize futures prices for pricing and risk management, so as to serve the enhancement of enterprises' competitiveness and the sound operation of the industrial chain supply chain, and realized a high-level balance between supervision and market efficiency.
It is reported that in 2023, the total turnover of commodity futures and options of Daxiangshang reached 2.5 billion lots, an increase of about 10% year-on-year, with an average daily position of more than 14.7 million lots, and the market's risk dispersion and carrying capacity continued to improve. In this regard, as one of the most influential varieties of Daxiang Shangshang, the oilseeds and fats sector, including five varieties of soybean 1, soybean 2, soybean meal, soybean oil and palm oil, has realized the full coverage of futures and options tools and the opening up of the whole industry chain to the outside world, and has built up a mature market system, which facilitates the cross-market arbitrage and risk management of the global oilseed and fats enterprises and the smooth flow of the cross-border trade business and the stable development of the industry chain. It has contributed to the smooth flow of cross-border trade business and the stable development of the industrial chain.
Taking palm oil as an example, Ran Hua said that relying on China as a globally important importer and consumer of palm oil products, the foundation of the spot market and the opening up of products to the outside world, the quality of the palm oil futures market of the Daxiang Institute of Commerce and its international influence have been steadily improving. From the market scale, palm oil futures turnover in 2023 exceeded 210 million lots, ranking No. 3 in the global ranking of agricultural futures and options contract turnover. From the perspective of market structure, palm oil futures account for 75% of unit customer positions, 65% of options unit customer positions, and a number of Southeast Asian industrial customers are widely involved. In terms of function, the correlation coefficients between palm oil futures prices and spot prices in mainland China and BMD gross palm oil futures prices are more than 0.9. At present, more than 70% of the palm oil spot trade in mainland China adopts Dahuangxiang futures prices as pricing benchmarks, and domestic and foreign enterprises hedge their risks through Dahuangxiang and BMD, so that the market service capacity continues to strengthen.
Ran Hua said that Dashang will continue to adhere to the direction of marketization, rule of law and internationalization, deepen market reform and opening up, build the market into an international first-class derivatives exchange combining futures and spot, synergizing with the on- and off-site markets, and connecting domestic and overseas markets, and focus on the three main lines of product innovation, technology drive and ecosystem construction to better serve global market participants.
It is understood that since 2006, Daxiang Stock Exchange and BMD have been working closely together, and with the annual POC Conference and the International Oilseeds and Fats Conference as a bridge, the two sides continue to deepen multi-level exchanges in terms of products, markets and other aspects. In particular, at the 2023 International Fats and Oils Conference and Agricultural and Livestock Industry (Derivatives) Conference held in Dalian last year, the two sides jointly signed an authorization agreement on soybean oil futures delivery and settlement price to further deepen strategic cooperation, based on which the development of the Malaysian bourse Dalian Commodity Exchange soybean oil futures (FSOY) contract will be listed and traded on March 18 in BMD.
