LLDPE futures likely to be traded from August at Dalian Commodity Exchange

10-Jul-07

LLDPE (Line Low Density Polyethylene) futures are likely to be traded from August at Dalian Commodity Exchange (DCE), one of China's three futures exchanges, pending final approval from the China Securities Regulatory Commission. The launch of LLDPE futures is the first new instrument by DCE this year. Other commodity futures traded on the exchange include corn, soybeans, soybean oil and soybean meal. The upcoming chemical futures have been welcomed by both manufactures and consumers of LLDPE as the futures products can help stabilize the LLDPE market, which has been subject to wide price fluctuations caused by swings in crude oil prices in recent years. In 2006, China's output of LLDPE totaled 2 million tons, up 25% from 2004. Imports of LLDPE in 2006 also increased 44% to 1.5 million tons from 2003. As per DCE figures, demand for LLDPE in 2010 is expected to reach 4.86 million tons and the average annual consumption is likely to increase 7.4%.