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Glass futures fall 7% on first day of trading
By Richard Fu |
December 3, 2012, Monday
|
Online Edition
Online Edition
THE world's first glass futures contracts fell more than 7 percent on the first day of trading on China's Zhengzhou Commodity Exchange amid concern of overcapacity and weak demand.
The most active May contract closed 7.18 percent lower at 1,318 yuan (US$211.4) per ton on the bourse in central Henan Province. The intra-day low was 1,314 yuan.
Analysts said domestic glass makers are struggling with high inventories as the government tightened control on the property market.
A futures contract could provide industry players with a financial tool to hedge against price fluctuations.
Producers of a certain commodity can sell their future production to lock in higher prices if they believe prices will fall, while users can buy future needs to reduce the risk of price fluctuations.
Glass is the second futures contract launched in China this year, after silver on the Shanghai Futures Exchange.
The most active May contract closed 7.18 percent lower at 1,318 yuan (US$211.4) per ton on the bourse in central Henan Province. The intra-day low was 1,314 yuan.
Analysts said domestic glass makers are struggling with high inventories as the government tightened control on the property market.
A futures contract could provide industry players with a financial tool to hedge against price fluctuations.
Producers of a certain commodity can sell their future production to lock in higher prices if they believe prices will fall, while users can buy future needs to reduce the risk of price fluctuations.
Glass is the second futures contract launched in China this year, after silver on the Shanghai Futures Exchange.
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