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This presentation is for information only and shall not be used as the basis for trading or any other purpose. DCE has taken reasonable care to ensure.

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Presentation on theme: "This presentation is for information only and shall not be used as the basis for trading or any other purpose. DCE has taken reasonable care to ensure."— Presentation transcript:

1 This presentation is for information only and shall not be used as the basis for trading or any other purpose. DCE has taken reasonable care to ensure the accuracy of information herein. However, no warranty is made as to the accuracy or adequacy of the presentation and DCE will not accept any liability for any errors or omissions.

2  China’s Futures Market Overview  Introduction to DCE  Economic Roles Played by DCE  Our Strategic Goals

3 CSRC Regional BureausFutures Exchanges Dalian Commodity Exchange Shanghai Futures Exchange Zhengzhou Commodity Exchange China Financial Futures Exchange Regulation of China’s Futures Markets China Futures Margin Monitoring Center China Futures Association 36 Regional Bureaus

4 DCE Corn, Soybean #1, Soybean #2, Soybean Meal, Soybean Oil, Palm Oil, LLDPE, PVC, Coke CZCE Hard White Wheat, Strong Gluten Wheat, Cotton, Sugar, PTA, Rapeseed Oil, Early Rice SHFE Copper, Aluminum, Zinc, Lead, Gold, Steel Rebar, Wire Rod, Fuel Oil, Rubber Beijing CFFEX CSI300 Stock Index Listed Futures Products Dalian Shanghai Zhengzhou

5 Market History 19951999200420101990 2010 Stats. (Round Trip) Vol.: 1.56 BB Contracts Turnover: 113.49 Tr. Yuan Pilot #Exchange: >50 #Product: >100 #FCM: >1000 Rectification #Exchange: 15 #Product: 35 #FCM: 330 Orderly Development #Exchange: 3 #Product: 12 #FCM: >180 Steady Growth #Exchange: 4 #Product: 26 #FCM: 160

6  China’s Futures Market Overview  Introduction to DCE  Economic Roles Played by DCE  Our Strategic Goals

7 Milestones DCE was founded Approved by State Council as one of the 15 pilot exchanges Designated by State Council as one of the 3 exchanges allowed to continue operations Trading vol. ranked #1 out of 3 exchanges in China Ranking of trading vol. moved into top 10 in the world Trading vol. ranked #3 out of 15 exchanges in China 1993199419971998 2000 2003 2004 2007200820102011 Corn futures was listed LLDPE, the first non- agricultural product of DCE, was listed Trading vol. exceeded 300 million contracts despite worldwide financial turmoil Moved into a new building – the Futures Tower Coke futures was listed, marking DCE’s diversification into energy related products

8 Member Meeting Board of Directors Exchange Executives 19 Departments 3 Regional Offices 3 Subsidiaries Org. Chart

9 Vol. Turnover 403 MM contracts 20.85 Trillion Yuan Trading Statistics DCE Trading Vol. & Turnover

10 2010 World Derivatives Exchange Rankings by Trading Volume Source: FIA (Unit: Million Contracts) Volume Ranking

11 2010 Rankings of Agricultural Futures & Options Contracts Product Ranking Source: FIA (Unit: Million Contracts)

12 Beijing 22 6 1 7 5 3 12 7 7 1 23 13 3 5 4 41 26 4 6 3 11 219 4 26 28 13 8 9 10 Dalian Headquarter Beijing Office Shanghai Office Guangzhou Office # Members # Warehouses 4 3 Note: data as of 2010/12/31 Members and Warehouses

13 # DCE Investors Investor Profile Trading Vol. by Investor Type ( 2010 ) OI by Investor Type ( 2010/12/31 ) Institutional: 836K (56%) Institutional Retail Retail: 654K (44%) Institutional: 38MM (9%) Retail: 365MM (91%)

14 Trading Vol. Distr 豆一 10 豆粕 37 豆二.01 豆油 23 棕榈油 11 LLDPE23.49% PVC4.92% 玉米 4 1993 2000 2004 2006 2007 2009 2004 Vol. %Year ListedProduct 16% 20% 47% 13% 4% Vol. by Geo. 豆一 10 豆粕 37 豆二.01 1993 2000 豆油 玉米 4 2004 豆一 10 豆粕 37 豆二.01 1993 2000 23.11% Palm Oil9.04%2007 Soy Oil Corn12.53% 2004 Soy #1 8.83% Soy Meal17.27% Soy #2.00% 1993 2000 Coke0.81%2011 2011 1H data

15 Risk Management Mark to Market Position Limit Price Collar Forced Position Reduction … Zero Major Default Zero Major Risk Event Robust Risk Mgmt. Sys.

16 Service Programs 10,000 Farmers 1,000 Factories Futures Institute Industry Confer- ence Top 10 Research Team

17 International Cooperation HKEx

18  China’s Futures Market Overview  Introduction to DCE  Economic Roles Played by DCE  Our Strategic Goals

19 ct./bu. Soybean Price: DCE vs. CBOTSoybean Price: DCE vs. Northeast Spot Yuan/ton Market Efficiency Yuan/ton Correl.=.861Corr.el.=.859 SpotFutures

20 Price Transparency Info. Dissemination Integrated Cash Market > 60 Before 2003 Since 2003 Soybean Price Differentials (Harbin vs. Jiamusi, Yuan/ton) ~0 200~80 < 10 Price Discovery Before 2003 Since 2003 Soybean Arbitrage Profits ( From Harbin to Dalian, Yuan/ton)

21 During 2H 2008 , DCE Soybean ↓ 47% ; CBOT Soybean ↓ 50% However , overall losses of domestic soybean crushing industry < 2 Billion RMB ; In 2008/10 , profits of top 20 soybean enterprises from futures trading > 1 Billion RMB Commercial Referencing of Soybean Futures Prices Category 92% 94% 86% 67% 73% 63% 57% 86% Producers Circulation Trading Co. Warehouses Consumption Crushers Feed Breeding Total % Follow Futures Price 89% Risk Transfer

22  China’s Futures Market Overview  Introduction to DCE  Economic Roles Played by DCE  Our Strategic Goals

23 Government Expectation “To build on the strengths of Dalian Commodity Exchange, promote futures trading, and establish an important futures trading center in Asia.” - Northeast China Revitalization Plan, 2007 “To increase products listed by Dalian Commodity Exchange and expand its market size.” - Development Planning on Coastal Areas in Liaoning Province, 2009 “To support DCE’s efforts in building an important Asian futures trading center by refining existing products and listing new products suitable for DCE’s positioning and apt for the regional economy of Northeast China.” - Opinions on Furthering the Northeast China Revitalization Plan, 2009

24 Agricultural Chemical Energy Related Index, Options, & others Product Development Plans

25 Thank You!


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