Chinese log futures were listed for trading on Monday and the trading of log options is set to begin on Tuesday, according to the Dalian Commodity Exchange (DCE).
The listing of these futures and options will effectively expand the depth and breadth of the futures market to serve the timber industrial chain, play an active role in helping relevant enterprises deal with price risks, and fine-tune the log pricing mechanism, the DCE said.
DCE Chairman Ran Hua said that log prices have been fluctuating in recent years, affected by multiple factors. There is a good foundation for the development of the log futures market, and there is strong demand for risk hedging in the industry.
These listings will facilitate open, transparent market pricing, enhance China's influence in the global timber industry, promote an industrial upgrade, and inject new impetus into the sustainable development of the industry, said He Hui, chief economist at the China Federation of Logistics and Purchasing.
Coniferous logs, the main trading object on the DCE's log futures and options markets, can be used for architectural timber, building formwork, wood panel processing and furniture production.
