Zhengzhou Commodity Exchange
From MarketsWiki
| Zhengzhou Commodity Exchange | |
| |
| Founded | 1990 |
|---|---|
| Headquarters | Zhengzhou, PRC |
| Key People | Zhao Zhengping, general manager; Wang Xianli, chairman |
| Products | Futures in wheat, sugar, cotton, rape seed and PTA |
| Web site | http://english.czce.com.cn/ |
The Zhengzhou Commodity Exchange (ZCE) is the third largest of China’s three futures exchanges, listing benchmark futures contracts in wheat and cotton alongside sugar, rapeseed oil and green beans, and adding its first non-agricultural contract - for pure terephthalic acid - in 2006.[1]
Contract volume rose 62.6 percent to 92.6 million contracts in 2006, and open interest reached a record 1.3 million contracts in November 2007.
Contents |
History
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The ZCE was established on Oct. 12, 1990, in Zhengzhou, the capital of Henan province in east-central China, the country’s most populous region. After operating a cash forward contract for two years, the first futures - in wheat, corn, soybean, green beans and sesame - were launched on May 28, 1993[2].
The exchange emerged from the restructuring of China’s futures industry, which was revived in 1990 after a 60-year hiatus, but saw the government close many of the 40-plus exchanges which emerged because of widespread price manipulation.
Contracts in peanut kernel, soybean meal and red beans wee added in January 1994, with Treasury notes added later in the year. Soybean, red bean and aluminum contracts were delisted in 1996, with Treasury notes also dropped after the government banned financial futures and Treasury notes, though plans emerged in 1996 to list stock index products on a new exchange.
In August 1998 the 15 remaining exchanges were reduced to three, with the exchange – renamed as the Zhengzhou Commodity Exchange – listing wheat, green bean, red bean and peanut kernel alongside the Dalian Commodity Exchange and the Shanghai Futures Exchange, which listed metals and rubber.
The ZCE’s clearing went electronic in 1997, and the three exchanges were linked with a single electronic network in 2001.
Structure and Regulation
The exchange is a non-profit, self-regulated entity, overseen by the China Securities Regulatory Commission, with 226 member firms (including 180 brokers).
Product Development
The tightness of the global wheat market has seen the grain complex overtake sugar as the ZCE’s most heavily traded product, with volumes of its benchmark high-quality gluten wheat future – launched on March 28, 2003 - rising to 23.5 million contracts in 2006, and spiking a further 329 percent to 15.9 million in the first half of 2007. The exchange also lists a lightly-traded hard winter wheat contract.
The white sugar contract, launched on Jan. 6, 2006, had overtaken wheat in its first year of launch, with 58.6 million contracts traded in the first year and average daily volume of 240,000, though volumes dipped 3 percent to 7.96 million in the first half of 2007.
The first non-agricultural contract, for pure terephthalic acid, was added on Dec. 18, 2006, and ranks third by volume, with 1.16 million contracts traded in the first half of 2007. Rapeseed oil futures were launched on June 7, 2007, and the exchange is also looking at contracts in raw silk and rough rice.
Key People
- General Manager, Zhao Zhengping
- Chairman, Wang Xianli
Contracts Listed
- ZCE Hard White Winter Wheat futures
- ZCE Strong Gluten Wheat futures
- ZCE Cotton futures
- ZCE White Sugar futures
- ZCE PTA futures
- ZCE Rapeseed Oil futures
News
On Nov. 6, 2008, NYSE Euronext announced it had signed a development partnership with the Zhengzhou Commodity Exchange.[3]
References
- ↑ China Futures Take Dragon Steps. Futures Industry Magazine. Retrieved on December 6, 2007.
- ↑ Zhengzhou Commodity Exchange Official History. ZCE. Retrieved on December 5, 2007.
- ↑ Press Release. eFinancial News. Retrieved on November 7, 2008.
