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China to launch refined sugar futures in early Jan
12/30/2005
SHANGHAI, Dec 29 (Reuters): China will launch white sugar futures in early January, exchange and regulatory sources said Thursday, offering firms a way to hedge surging local prices and further expanding the nation's fledgling derivatives markets.
An official with the China Securities Regulatory Commission said refined white sugar futures would be launched "very soon", but declined to give an exact date.
"It's likely to be January 6, though the final date has yet to be approved by regulators," said an official with the Zhengzhou Commodity Exchange, on condition of anonymity.
China has forecast a deficit of 700,000 tonnes of sugar in the crop year through September. Domestic output was estimated at 9.8 million tonnes.
Sugar plants in China's key producing southern areas had not been able to secure enough cane and had delayed crushing for the crop year, helping foment a supply squeeze that has pushed domestic prices for refined sugar to record highs.
There had also been market speculation of still higher prices to come because some sugar firms are holding on to stock.
Beijing has warned that too big a rise in prices would harm consumption and the industry, and said it planned to release 200,000 tonnes of raw sugar from reserves to help cap prices for refined sugar before the end of January.
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