Chang Depeng, a spokesperson for the China Securities Regulatory Commission, stated during a routine news conference on December 8th that the Securities Regulatory Commission had already approved the Zhengzhou Commodity Exchange to start the trade of apple contracts. The contracts will be traded at the Zhengzhou Commodity Exchange from December 22nd, which means that every breed of apple from all over the world can now enter the market in China.
In recent years, the production volume of China's apple industry increased annually and the price frequently fluctuated. There were great disparities between different years. The industry found it difficult to respond to changes in market supply and demand because it lacked effective, long-term price guidance and risk avoidance. The industry could only passively take the risks of price fluctuation, which often caused fruit farmers and businesses to blindly hoard apples. There then emerged a situation where farmers were harmed by low fruit prices, and businesses incurred severe losses. Bringing apple contracts on the market is beneficial for risk management in the industry. It stabilizes the income of fruit farmers. And it is beneficial for the perfection of mechanisms that shape the price of apples. It establishes authoritative prices.
Source: China Economy Online