(Corrects details on contracts, trading volume in 4th, 5th
* Launch as China embraces commodities derivatives trading
* Caution ahead of critical U.S. plantings report
BEIJING, March 31 China's investors placed
bearish bets on Friday's opening day of soymeal options trading
on the Dalian Commodities Exchange, seeking protection as
futures tumbled to 4-1/2 month lows ahead of a widely
anticipated U.S. government plantings report.
The most-active September soymeal futures closed
down 0.32 percent at 2,780 yuan in cautious trading before the
U.S. Department of Agriculture releases estimates for U.S.
grains plantings for the 2017/18 season - one of the most widely
watched reports of the agricultural calendar, and one that can
The launch of soymeal options offers a more complicated yet
flexible hedging tool for financial investors and soybean
crushers alike and spearheads China's efforts to push into
To hedge against further volatility, traders positioned
themselves on Friday firmly on both sides of the market. They
jumped into various contracts: September 3,000 yuan per tonne
calls and September 2,600 yuan per tonne puts
, the two most-active options on the day.
Turnover on the first day of trading totalled 46,066 calls
and puts by market close on Friday, equivalent to 460,660 tonnes
of soymeal - well below the more-than-500,000 lots of futures
and the more-than-125,000 lots of U.S. soymeal options on the
Chicago Mercantile Exchange on Thursday.
But it was in line with expectations for a cautious start.
"I only did several deals to basically try my hands," said
Mo Qingping, investment director at ESFund Management Co, with
more than 2 billion yuan ($290 million) in assets.
"We didn't spot any good opportunities. "But trading volume
for this morning was quite all right given it's a new product,"
Market watchers said that the complexity of options trading
may have curbed some investors' interest for now, contributing
to the relatively low trading volume.
But the potential for China's largest agricultural
derivatives market remains huge, they said.
"The launch of soymeal options will supplement the futures
market and facilitate healthy development of the soy industry,"
said Chang Qing, chairman of Jinpeng Intl Futures Co Ltd, and
professor at futures and financial derivatives research center
at China Agricultural University.
(Reporting by Hallie Gu and Josephine Mason; Editing by Kenneth