Coke futures soar on first day of trade
By Richard Fu |
April 16, 2011, Saturday
|
Print Edition
Print Edition
The world's first coke futures rose 3 percent on the first day of trading on China's Dalian Commodity Exchange yesterday, giving a hedge tool to producers and users of the steel-making ingredient.
The most actively traded September contract closed at 2,247 yuan (US$344) a ton, up 3.07 percent from the base price of 2,180 yuan, with volume traded reaching 57,134 lots. One lot is equivalent to 100 tons of coke.
The contract opened at 2,300 yuan, an intra-day high.
"This is relatively active trading," said analyst Wang Na at Everbright Futures, adding spot price for first-grade metallurgical coke was quoted at 1,920 yuan per ton in Taiyuan, Shanxi Province, China's main coke producing region.
Coke is derived from coking coal and is used to produce steel. The Dalian bourse also plans to introduce coking coal contracts.
Chinese mills supply only a third of their coke needs from their own production, according to the China Coking Industry Association. This means in the past they had to rely on the spot market for coke, whose price fluctuated a lot.
Now, producers can sell their future production to lock in higher prices, while users can buy future needs to reduce the risk of price fluctuations in China's 700 billion yuan coke market.
The most actively traded September contract closed at 2,247 yuan (US$344) a ton, up 3.07 percent from the base price of 2,180 yuan, with volume traded reaching 57,134 lots. One lot is equivalent to 100 tons of coke.
The contract opened at 2,300 yuan, an intra-day high.
"This is relatively active trading," said analyst Wang Na at Everbright Futures, adding spot price for first-grade metallurgical coke was quoted at 1,920 yuan per ton in Taiyuan, Shanxi Province, China's main coke producing region.
Coke is derived from coking coal and is used to produce steel. The Dalian bourse also plans to introduce coking coal contracts.
Chinese mills supply only a third of their coke needs from their own production, according to the China Coking Industry Association. This means in the past they had to rely on the spot market for coke, whose price fluctuated a lot.
Now, producers can sell their future production to lock in higher prices, while users can buy future needs to reduce the risk of price fluctuations in China's 700 billion yuan coke market.
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