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Introduction to MEG futures contract and rules designing status
!!Chen Ruigang, Director Assistant of industrial products, DCE / PhD in Economics, GUCAS

2018-03-29 12:11:55
Chen Ruigang, Scholar from Dalian Commodity Exchange, presented his report of Introduction to MEG futures contract and rules designing status 

Dr. Chen elaborated the approval progress of launching MEG futures and the research status. 

1. MEG futures delivery quality standard 
The current national standards are widely recognized by the spot trade. 

2. MEG futures delivery regions 
Supply of ethylene glycol are centered on East China (Jiangsu and Zhejiang), followed by South China. Consumption of ethylene glycol are centered on East China (Jiangsu and Zhejiang), followed by South China. The logistics are mainly to East China and South China. Storage tanks of ethylene glycol are mainly in East China, represented by Jiangsu and Zhejiang. Delivery areas are mainly in East China and South China with intensive production and sales. East China is the benchmark. 

3. MEG futures risk control system 
Ordinary margin trading: 5 of contract value. Range of limit up or down: 4%. Position limit of 1,000 lots (10kt) in delivery month can meet hedging demand. 

4. MEG futures delivery system 
There several ways of MEG futures delivery, including one-time delivery, rolling delivery, futures turning to spot, etc. There are two categories of MEG futures warehouse receipts, i.e. delivery house receipt and plant house receipt. Validity of MEG futures warehouse receipts: 1 year at most. 
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