Trade Resources Market View DGCX and DCE Will Launch Their Respective Polypropylene Futures Contracts on February 28

DGCX and DCE Will Launch Their Respective Polypropylene Futures Contracts on February 28

The UAE's Dubai Gold and Commodities Exchange, or DGCX, and China's Dalian Commodity Exchange, or DCE, announced Wednesday that they will simultaneously launch their respective polypropylene futures contracts on February 28.

"The concurrent launch of both the exchanges' contracts is designed to raise substantial liquidity for global trading of the products," DGCX said in a statement.

DGCX and DCE have been working closely to develop plastics contracts following the signing of a memorandum of understanding in 2012, DGCX said.

The physically delivered PP contracts -- called the DGCX Plastic futures contract and DCE Plastic future contract -- will be sized at 5 mt, with the contract price quoted in dollars per metric ton. The PP will be of general purpose raffia grade with a melt flow rate ranging from 2.5 to 4. The trading days for the DGCX contract are Monday to Friday and the trading hours 0700-1300 Dubai time (0300-0900 GMT). The DCE contract will trade from 0900-1130 hours and 1330-1600 hours China time.

"The GCC region produces more than 50 million tonnes of plastics a year with a significant percentage being exported to the Far East. Market participants currently do not have a means for effectively hedging against price fluctuations. The listing of our polypropylene futures contract will fill this gap," DGCX CEO Gary Anderson said in the statement.

DCE CEO Li Zhengqiang said: "Though China is the largest importer of polypropylene, participants in the market have been exposed to significant price risk for several decades. We have been working with DGCX to structure a similar plastics contract that helps the plastics industry to hedge their exposure effectively."

Source: http://news.chemnet.com/Chemical-News/detail-2258793.html
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UAE's DGCX, China's Dce to Launch Polypropylene Futures Contracts Feb 28
Topics: Chemicals