ZCE Strong Gluten Wheat
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ZCE strong gluten wheat futures trade on the Zhengzhou Commodity Exchange (ZCE). They were launched on March 28, 2003[1].
Currently, China is the world’s top wheat producer[2].
Each ZCE strong gluten wheat futures contract represents 10 tons of deliverable 2nd grade strong gluten wheat, which is defined in accordance with Exchange standard Q/ZSJ001-2003, while substitutions at differentials that meet ZCE delivery rules are also good for delivery, and its delivery date is set as the first to last trading day of the contract month[3].
Each ZCE strong gluten wheat futures contract is subject to a margin rate equivalent to 5 percent of contract value (e.g., 979.5 yuan = 1959 yuan [WS809 last price on May 22, 2008] x 10 [tons/contract] x 5 percent) as well as a trading fee of 2 yuan (RMB) / contract.
Unlike its sister contract, ZCE hard white winter wheat futures, ZCE strong gluten wheat futures are far more actively traded, primarily because its commercial usage and definition of delivery eligibility are quite clear and because price volatility is relatively large due to a smaller amount of strong gluten wheat available for delivery. In 2007, ZCE strong gluten wheat futures traded 77,956,702 contracts (+165.7 percent YOY) and its turnover amounted to 1,513 billion yuan (+198.65 percent YOY), making it the second most actively traded (in terms of volume) and second largest (in terms of turnover) futures contract on ZCE after ZCE sugar futures.
| ZCE Strong Gluten Wheat futures | ||
|---|---|---|
| Exchange | Zhengzhou Commodity Exchange | |
| Settlement | Physically delivered | |
| Trade Unit | 10 tons/lot | |
| Point Value | 10 yuan (RMB) | |
| Tick Value | 10 yuan (RMB) | |
| Contract Months | Jan, Mar, May, Jul, Sep and Nov | |
| Last Trading Day | The seventh business day prior to the last trading day in the contract month. | |
| Note: This contract is electronic ONLY -- no open outcry | ||
| No Open Outcry | No Electronic Market | |
| Trading Hours | N/A | 9:00-11:30 a.m. 1:30-3:00 p.m. |
| Ticker Symbol | N/A | WS |
| Price Limits | N/A | 3% above or below the previous trading day's settlement price |
References
- ↑ History of ZCE. Zhengzhou Commodity Exchange. Retrieved on May 21, 2008.
- ↑ Record crop to ease wheat prices?. Toronto Star. Retrieved on June 25, 2008.
- ↑ Strong Gluten Wheat Futures Contract Specs. Zhengzhou Commodity Exchange. Retrieved on May 21, 2008.
