At the 2nd China Iron and Steel Financial Derivatives International Conference held in Shanghai on June 16th, Wang Mingwei, the director of the medium-term association, said that the futures market provides a market-oriented means for steel enterprise risk management, which can effectively help steel enterprises manage sales price risk and control. Purchasing costs, optimizing inventory management, rationally arranging and adjusting production plans can also help companies reduce costs and increase efficiency, improve profitability and competitiveness, optimize industrial structure and trade forms, and promote transformation and upgrading of the entire industry.
“2017 is a tough year for the structural reform of the supply side of the steel industry. The task is arduous. In this process, how to prevent the risk of price fluctuations and ensure the realization of corporate profits is a core issue.” Wang Mingwei said that the futures market as a price discovery The market for risk management provides a market-oriented management tool for the steel industry to manage price risks and achieve business objectives.
According to reports, 149 futures companies nationwide actively carry out specialized services around the risk management needs of the steel industry. In particular, in recent years, futures risk management companies are actively engaged in innovative business, and based on the individualized risk management needs of different steel companies, OTC options are launched. , basis trading, warehouse receipt service, cooperative hedging and other services, to resolve the difficulties of steel-related enterprises in production, trade and other operations, and achieved good results.
However, Wang Mingwei also said that the relevant institutional rules of the futures market need to be continuously improved and improved. The futures market and the spot market need to be further effectively docked and coordinated. The basic functions of the futures market need to be actively participated by the majority of entities.
"The functional role of the vast number of entities in the futures market also requires a process of understanding. Enterprises, especially state-owned enterprises, need to cooperate and support the relevant supporting policies and systems in their participation in the futures market," said Wang Mingwei.
It is understood that in order to make the futures market better serve the steel industry, the Mid-term Association signed a Memorandum of Cooperation with the China Iron and Steel Association at the end of 2016. At the beginning of this year, the two sides jointly formulated a specific work implementation plan, and the two sides will share information in the industry. Exchanges and cooperation are actively carried out in the steel futures business, personnel training and research projects.
According to reports, the two sides have promoted relevant cooperation in the following aspects in order: First, the establishment of a regular exchange and sharing mechanism for industry information, further strengthen the cooperation between the two sides in the research activities of the relevant conference; Second, actively carry out the steel industry chain Relevant spot enterprise training of futures, options and other derivatives, popularize and deepen the understanding and understanding of the steel industry on the futures market; Third, organize the drafting of the "Guidelines for Hedging of Steel Production Enterprises", guide the steel production enterprises to establish and improve relevant systems, and use The futures market conducts risk management. The guidelines will openly solicit opinions from the general members and the community. Fourth, the three commodity futures exchanges will be organized to organize the steel industry enterprises to participate in the compilation of futures market cases for reference and reference.
Wang Mingwei said that in the future, the Mid-term Association will further play the functions of "self-discipline, service, and transmission", enhance the ability of futures companies to serve the real economy, and promote more steel-related enterprises to participate in the futures market for risk management, so that the futures market is better. Serve the transformation and upgrading of the steel industry.
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