On the evening of October 28, monthly average futures for linear low-density polyethylene (LLDPE), polyvinyl chloride (PVC), and polypropylene (PP) were officially listed for trading on the Dalian Commodity Exchange (DCE). The first day of trading saw stable performance, with active participation from industrial chain enterprises, further enriching risk management tools for the sector.
As China's first batch of monthly average futures contracts, these three chemical products listed contracts for February, March, and April 2026 (2602, 2603, 2604) on their debut. The benchmark prices were determined based on the settlement prices of the corresponding physical delivery futures contracts on October 28. By the close of trading on October 29, the three contracts recorded a combined trading volume of 8,254 lots, with a turnover of 230 million yuan and open interest of 2,468 lots. Institutional clients accounted for 89.7% of the positions, reflecting strong industrial participation. Price-wise, the contracts fluctuated reasonably around their benchmarks, with the near-month L2602F, V2602F, and PP2602F contracts closing slightly higher by 0.04%, 0.86%, and 0.10%, respectively.
Yong'an Futures General Manager Ma Zhiwei noted that the first-day performance of these monthly average futures aligned with expectations, indicating rational market understanding of this new instrument. The contracts use the monthly arithmetic average of settlement prices from corresponding physical delivery futures as their final settlement price, with daily settlement prices calculated in phases—ensuring price fairness while mitigating manipulation risks from the outset.
Key players in the plastics and chemicals industry, including Shandong Chambroad Petrochemicals, Shanghai Zhongtai Multi-Economy International Trade, and Zhejiang Mingri Holdings, participated in the inaugural trading session.
Chambroad Petrochemicals, a major PP producer with an annual capacity of 600,000 tons, utilized the PP2602F contract to lock in sales prices on the first day. The company had pioneered using monthly average settlement prices for spot trades since 2024. Vice President Liu Yong stated that these futures align with enterprises' "monthly sales + average pricing" model, helping smooth out daily price volatility. Additionally, with monthly averages becoming a global pricing benchmark, the contracts provide Chinese exporters with enhanced pricing references, supporting "China prices" in global trade integration.
Zhongtai Multi-Economy, a key PVC industry player, executed sell-side hedges via V2602F contracts to manage price risks for long-term orders. Vice President Ma Liping emphasized that the new tools enhance stability for the PVC supply chain, complementing their existing hedging services for Xinjiang Zhongtai Group.
Mingri Holdings, a chemical trading firm, completed multiple transactions on debut. Vice Chairman Shao Shiping highlighted that the cash-settled contracts expand enterprises' participation options in futures markets while enriching price signals for physical-chemical trade integration.
Ma Zhiwei cautioned that as innovative products, monthly average futures—while closely related to traditional physical-delivery contracts—have distinct features. Their market efficiency and functional maturity will require time to develop. He advised industrial players to familiarize themselves with the instrument, particularly for long-cycle average pricing scenarios where it could significantly benefit operations.
DCE officials confirmed that these contracts are now accessible to qualified foreign investors. The exchange will continue optimizing rules to improve market quality, facilitate industrial participation, and strengthen China's pricing influence in the chemical sector, supporting high-quality development in the plastics industry.
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