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What are egg futures? Egg futures basic overview and all-round introduction
A basic overview of egg futures

The beginning of egg futures by the world-renowned futures exchange Chicago Mercantile Exchange (CME) first, CME began to rely on egg futures to start. CME was founded in 1874, its predecessor for the Farm Products Exchange, created by a group of farm products dealers, the exchange listed the main commodities for butter, eggs, poultry and other agricultural products that do not tolerate storage. 1898, the butter and egg dealers quit the Chicago Butter and Egg Exchange was formed. In 1898, the butter and egg dealers withdrew from the Farm Products Exchange and formed the Chicago Butter and Egg Exchange, later renamed the Chicago Mercantile Exchange. In addition to the CME, egg futures have also been listed and traded on the Chubu Commercial Exchange in Japan. According to China's Dashang "egg futures research and design program", egg futures contracts and steel, lead futures can easily be hundreds of thousands of dollars compared to the contract, more "miniaturized", each hand trading unit of 500 kilograms, the smallest change in the unit of 0.1 yuan / 50 kilograms, the minimum margin for the value of the contract of 5%. According to the historical high price of eggs 10.74 yuan / kg, and futures companies charge 10% of the margin ratio calculation, each hand of egg futures contract margin as long as 537 yuan.

In China, egg futures is the first livestock futures varieties and fresh agricultural products. 2013 March 18, the Dalian Commodity Exchange issued a draft egg futures contract. 2013 September 25, the China Securities Regulatory Commission approved the listing of egg futures contracts on the Dalian Commodity Exchange. 2013 September 25, the China Securities Regulatory Commission approved the listing of egg futures contracts on the Dalian Commodity Exchange (referred to as Daxiangshangxian), to further enhance the integrity of varieties of futures contracts. On September 25, 2013, the China Securities Regulatory Commission (CSRC) approved the listing of egg futures contracts on the Dalian Commodity Exchange (Dalian Commodity Exchange, or DCH) to further improve the system of agricultural futures varieties, to meet the actual needs of spot enterprises and to better serve the development of the real economy. The company will list the egg futures contract in accordance with the market conditions and the progress of the preparatory work, in due course.

Second, the egg futures exchange and trading code

Egg futures exchange: Dalian Commodity Exchange, trading code: JD.

Third, the egg futures standard contract

Four, egg futures contract design principles

Egg futures contract design embodies the principles of close to industry demand, to protect food safety, and strict control of operational risk.

First of all, the egg futures design adhere to the principle of close to the needs of the industry, in full consideration of China's egg industry production geographically dispersed, the average scale of farming and trade and other realities on the basis of the formation of "small and micro" enterprises to participate in the design of the program; Secondly, the egg is an important nutritious food for the general public to protect the futures delivery of food safety is our design of the egg futures contract, we will continue to work on the design of the futures contract. Secondly, eggs are an important nutritional food for the people, and ensuring the food safety of eggs for futures delivery is the most important factor we pay attention to when designing the contract, and we have strict requirements on the delivery quality standard and seek innovation on the delivery system, so as to ensure the food safety of eggs for futures delivery in all aspects; finally, we have drawn on the experience of designing egg futures in foreign countries, and based on the operational characteristics of China's egg industry, we have taken the safety of the overall market as an important design principle, and have determined the position limit of each customer reasonably, so that the operation of the futures market can meet the Limit, so that the futures market operation can be consistent with the unique characteristics of the egg spot, and the establishment of risk management measures for epidemic outbreaks and other unexpected events, to protect China's first livestock varieties of the overall operation of the market safety, play the role of the futures market should be.

In the specific design of the contract and the system, we are based on the actual situation of the egg industry enterprises, targeted design system, process and related parameters, reflecting the service of the industry. For example, the contract size of egg futures in accordance with the average size of China's daily output of farmers to determine, to facilitate the participation of small and medium-sized farmers, the delivery month of the position limit is also in accordance with the habits of the spot trade and small and medium-sized traders in the actual situation of the set, to adapt to the characteristics of the egg industry small-scale.

V. What are the factors affecting the price of egg futures

(a) Macro-environmental and policy impact

Since the reform and opening up, China's economy has continued to develop rapidly, economic strength and comprehensive national strength has been increasing, infrastructure and urban and rural landscape has undergone tremendous changes. Since entering a new stage of development, the economy has maintained steady and rapid growth, and state revenues have increased significantly. It is in this general environment, the consumption level of residents is getting higher and higher, and the price level also shows a rising trend, which leads to the price of eggs show a trend of change in fluctuations in the rise. In addition, once the macro-environmental changes, will also have an impact on the price of eggs.

The adjustment of the relevant national industrial policy, import and export policy adjustments, as well as agricultural products (000061, stock bar) storage policy, etc. will have a direct or indirect impact on egg prices.

(ii) the impact of supply on prices

Changes in production. As the egg production from the purchase of chicks to lay eggs at least half a year, with a long cycle, farmers on the regulation of their production will lag behind the changes in supply and demand in the market, resulting in cyclical changes in the market for eggs. Therefore, changes in egg production is an important factor affecting the price of eggs.

The impact of production scale. China's egg farming industry will always appear price fluctuations, a very important reason is that farmers in the egg farming blindness. See others to raise their own or even blindly expand the scale of farming, do not take into account their own conditions and the national market conditions, so that the market oversupply of eggs, vicious competition with each other, is the decline in egg prices. Chicken rearing scale directly determines the economic benefits of farmers and the supply of eggs in the market, the greatest impact on changes in supply and demand, is the main factor affecting changes in egg prices. With the gradual increase in the scale of chicken farming, the supply of egg products continues to increase, in the case of unchanged production technology, according to the law of diminishing marginal expected annualized expected returns, egg prices will show a downward trend.

Seasonality of production. The climate is gradually warming in the spring, is the most suitable season for chickens to lay eggs, into the peak season of egg production, the supply increased, the price of eggs fell; summer temperatures are higher, the climate is hot, affecting the amount of feed for laying hens, resulting in a decrease in the egg production rate of hens, into the off-season of laying, the amount of egg production and the amount of listing will decline, the supply is reduced, the price of eggs rose.

(C) demand factor analysis

Factors affecting demand: 1, changes in population size; 2, the regional economic development rate 3, the price of the egg commodity itself, the price of other related commodities; 4 consumer income levels; 5, consumer eating habits; 6, consumers tendency to consume in the future. These factors *** with the same impact on the demand for eggs, changing the supply and demand, causing changes in the price of eggs.

Population size and economic development. Population growth and rapid regional economic development will increase the demand for egg products in society.

The price of eggs themselves. The consumer price of eggs is the most important factor affecting the number of eggs per capita staple food consumption. Generally speaking, the number of per capita consumption of staple foods will decline with the rise in consumer prices, on the contrary, rise. In other words, there is a negative correlation between per capita consumption of eggs and consumer price. At the same time, the price elasticity of demand for eggs (the magnitude of change in quantity demanded / the magnitude of change in price) should be negative.

Substitute prices. Generally speaking, in the case of unchanged eggs, the decline in the price of competing products, consumers will increase the consumption of competing products, thereby reducing the consumption of eggs; Conversely, the high price of pork and other meat prices to a certain extent increased people's consumption of eggs.

The impact of changes in consumer spending habits. Mainly by the region and the impact of the consumption season. For example, in summer, people eat clean, egg substitutes for pork, beef and mutton consumption is reduced, egg demand increases, egg prices rise; Conversely, the winter is a relative reduction in consumption.

Seasonality of market demand. The economic benefits of egg farming by the market supply and demand constraints, oversupply, egg prices fell, on the contrary, will be raised, every year in April and May, August and September, there will be a very obvious high up wave, the reason is mainly pre-holiday consumer demand for eggs increased, so driving up egg prices.

(D) cost factors

China's egg farming costs as a whole is a rising trend year by year. According to the Ministry of Agriculture national feed bazaar prices, in 2011 the average price of laying hens with feed for 2.81 yuan / kg, up 7.25% over 2010; the average price of laying hens seedling 3.23 yuan / kg, up 26.67% over 2010. Together with the rise in labor, electricity and other rising costs, in 2011, the whole breeding cost of laying hens reached about 135.59 yuan / only, up 7.51% over 2010.

(E) weather factors and the impact of transportation costs

Weather changes will affect the egg storage and transportation, directly related to changes in egg prices. Such as: hot summer weather, egg storage difficulty, while in case of rainy weather, the transportation also brings many inconveniences; at the same time, with the rise in international oil prices, the cost of transportation has further increased, further impact on the price of eggs.

(F) the impact of epidemics and import and export quantities

Chicken disease epidemics is one of the larger factors affecting the future supply of eggs, resulting in fluctuations in egg prices.

The number of import and export of eggs is also part of the egg market supply and demand, changes in import and export volume of egg supply and demand, which in turn affects the price of eggs. However, due to the relatively small number of domestic egg imports and exports, which in turn has a limited impact on the price.