SteelOrbis Shanghai
Rumor has been circulating that Chinese first steel futures contract is expected to be launched soon after the lunar New Year. Against this situation, many futures brokerage companies begin making preparations, setting about developing this business. Shanghai Futures Exchange (SHFE) has already completed relevant manning arrangement, just waiting for the approval. Once it gets the green light from government authority, SHFE will spend two weeks for the trial operation in order to ensure the system's stability and reliability, also to help customers to acquaint with the new system.
It's heard that the futures contracts of wire rod used for construction and rebar will be firstly launched.
Given the massive steel production of China, as well as the number of steel forward market which are now more than ten, there will probably be many participants as regards the steel futures market.
After all, futures transaction includes as big risk as the revenue is can bring. Historically, in many cases, the price fluctuation in futures market has been larger than that in the spot market, as a result of which it hasn't played the expected role of stabilizing the market actually, but instead it has contrarily increase speculation circumstance. As the rumor in question comes out, some market players have been speculating it as an impetus in pushing up steel prices in 2009. Thus, the steel is expected to rise to higher level than previous expectation.
All in all, steel futures is more than a sharp blade which will bring in benefits or scourge depending on how you use it.