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On December 19, the corn starch futures were officially listed and traded on Dalian Commodity Exchange (DCE), and the first listing day recorded brisk trading of the futures with the trading volume reaching 17,121 contracts (unilaterally, the same below), the turnover amounting to RMB 482 million and the open interests standing at 3,620 contracts. According to the participants in the corn deep-processing industry observing the trading on the scene, the corn starch futures showed rational performance and moderate liquidity, which met the market expectations, and the future development is promising.
A total of 5 contract months were offered on the first listing day. The dominant contract 1505 recorded a trading volume of 14,562 contracts and its price fell by 0.25% to RMB 2,793 / ton during the day.
“The performance of the corn starch futures on the first listing day fully demonstrated that the market participants have thoroughly analyzed the fundamentals of starch and the rules for futures trading, and the operation was rational and prudent on the whole,” said Shi Yan, Deputy Director of the research center of Xinhu Futures. He believed that the listing price of RMB 2,800 set by DCE was appropriate. In addition, the price differences between the contract months fully reflect the seasonal trends as well as the expectations for policies.
As a downstream product of corn, the corn starch price is highly correlated to corn, and the arbitrage between the two products is one of significant investment value. Therefore, the investors were concerned about the good opportunities in arbitrage on the first listing day of the corn starch futures.
The market participants are generally optimistic about the prospects for the future development of the corn starch futures. According to one market participant,“The product has a variety of topics for hype such as the adjustment of the national import and export policies, the industrial restructuring and the withdrawal of industrial capitals, all of which are effective catalysts to trigger increases in the volatility of the starch contract.”
