2013年10月18日 星期五

Rubber contracts in Xishangbanna Commodity Exchange


Rubber contracts in Xishangbanna Commodity Exchange (October 18, 2013.)

 

Xi Shang Ban Na?  It is a place in Yunnan province in China.  An Autonomous Prefecture that kind of runs its own show and sitting right next to Burma and Laos.  Driving distance to Thailand and Vietnam who are major rubber producing countries.

 

The Xishangbanna Financial Asset and Commodity Exchange is owned by Pingan, the second largest insurance company in China.  They launched a rubber contract in September.  Physical settled into “SCR WF” standard which is the same standard used in the very liquid rubber contracts listed in Shanghai Futures Exchange. 

 

Rubber maybe a lesser popular commodities for investors but it is the second most traded commodities in Shanghai Future Exchange after copper in 2012.  The volume in Shanghai is shockingly high relatively to other exchanges.  For example, on October 18, 480,000 2014 January Rubber contracts were traded which means CNY 98 billion (USD 16 billion) worth of rubber.  The most liquid rubber contract trading in TOCOM is the 2014 March contract that traded USD 57.8 million notional on Oct 18.

 

Xishangbanna Exchange could take advantage of its location being close to the producers but it is a long way to go in order to attract the speculators in Shanghai Futures Exchange.

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