China News Service, Dalian, June 18 (Reporter Yang Yi) Palm oil options were listed and traded on the Dalian Commodity Exchange on the 18th. This is China's first option contract involving foreign traders.
As the most widely used vegetable oil in the food industry, palm oil consumption has surpassed soybean oil to become the world's largest consumption of vegetable oil.
At present, China has become the world's second largest importer of palm oil.
In recent years, with the increasing uncertainty in the external environment, the volatility of palm oil spot prices has intensified. Spot companies look forward to an early listing and simultaneous opening of risk management tools such as palm oil options.
According to Ran Hua, chairman of the Dalian Commodity Exchange, in 2007, palm oil futures were listed and traded on the Dalian Commodity Exchange.
The market has been operating steadily for more than ten years since its listing.
On December 22, 2020, palm oil futures were successfully introduced to overseas traders, and the international influence of palm oil futures was increasing day by day.
After the palm oil option was listed, foreign traders were introduced. This is also China's first international option product.
According to the existing regulations on specific varieties, in terms of the management of overseas participants, participants will be managed in accordance with the real-name system and transaction codes for one household and one code.
In terms of transactions, overseas traders can participate through domestic futures companies or overseas brokerage agencies entrusting domestic futures companies to participate; the settlement system is still priced in Renminbi, and U.S. dollars can be used as margin.
Ran Hua said that with the listing of palm oil options, the Dalian Commodity Exchange has taken the lead in realizing futures options, on- and off-exchange, domestic and international coverage on palm oil, a fully imported commodity.
At present, DCE has initially formed a derivative instrument system that combines futures and spot products, on- and off-market collaboration, and domestic and overseas connections on palm oil.
Gao Wen, secretary-general of the China Vegetable Oil Industry Association, pointed out that listing palm oil options and introducing overseas traders to participate in trading can form a synergy with futures, further enrich market risk management methods, and better meet the needs of domestic and foreign palm oil production, processing and trading companies. Hedging demand, improving the quality of market operations, and boosting the internationalization of the RMB.
(Finish)