In order to adapt to the new national standard, keep closer connection with the reality of the spot goods and better serve the industries, on June 13, Dalian Commodity Exchange (DCE) issued the “Notice on Adjusting LLDPE Delivery Quality Standard” to amend the delivery quality standards of the LLDPE and the amended rules will come into effect from the L1506 Contract.
According to the notice and the amendment, the revision mainly focuses on the following aspects: first, in the statement of the appearance indicators, the provision of “The size of the cylindrical or oval-shaped granules should be 2-5mm in any direction” is deleted, the requirements for “no impurities” and “no black granules” are affirmed and the indication of “contaminated granules” is replaced with “color granules”; second, the testing methods of the tensile performance indicators are adjusted, the indicator values are accordingly adjusted, the indicator value of “tensile yield stress” is adjusted from “≥ 8.3MPa” to “≥ 7.0MPa”, the indicator of “tensile breaking stress” is deleted, and the “elongation at break ≥ 500%” is adjusted to “nominal tensile fracture strain ≥ 200%”; third, it is confirmed that except the density, the testing of other indicators shall be implemented in accordance with the new national standards; fourth, the product name description is added so as to adapt to the diversified packages and logos of the LLDPE products after the promulgation of the new national standards; fifth, the relevant statements are improved with the provisions related to “terminology and definition” added.
A DCE official said that the designing of the former LLDPE delivery quality standards was mainly based on the recommended national standard GB / T 15182-1994 “LLDPE Resin”. On February 1, 2010, the new national standard GB / T 11115-2009 “Polyethylene (PE) Resin” officially came into effect. Compared with the former national standard, the new national standard is closer to the universal international standards, combining the three national standards for “LLDPE”, “LDPE”, and “HDPE”. After the amendment, the existent LLDPE futures delivery quality standard, which has some differences from the new national standard in the statements of product name and granule appearance and the testing method of tensile performance, needs to be adjusted to comply with the provisions of the new national standard.
The DCE official said that the new national standard adapts to the international ISO standards system in the testing methods and quality standard system. The product quality represented in the amended delivery quality standard has no essential change from the former standard, and it is not a substantive amendment and will not increase the delivery costs nor will it result in actual impact on the volumes available for the delivery. The amendment is based on the reality of the spot goods and businesses, and is in line with the demand for the development of the spot market, trade practices and the actual operations of the delivery business. In addition, as China’s dependence on the import of LLDPE reaches about 40%, the amendment of DCE’s delivery quality standard in accordance with the new national standard will better adapt to the international trade practices.
Since the promulgation of the new national standard, DCE has researched the background for the amendment and the market applicability of the new national standard, analyzed the record data of the tests, compared and tested the products of the existing brands on the market according to the requirements of the old and new national standards for sample preparation, sampling and testing, made in-depth research and survey in the necessity, feasibility and potential impacts of the adjustments to the delivery quality standard, extensively solicited the opinions of the member clients participating in the futures trading and delivery and especially the opinions of the LLDPE spot enterprises as well as the quality inspection institutions and the revisers of the new national standard, and fully assessed the impacts of the new national standard adjustment on the DCE’s LLDPE futures delivery quality standard, on the basis of which the amendment plan was developed.
The market participants generally agreed that the adjustment plan for the LLDPE delivery quality standard is reasonable, will not have a substantive impact on the market, will help the futures contracts more closely reflect the spot trading practices, and will promote the better service of the futures market for the industrial clients.
