Shanghai begins trading in financial derivatives on items related to printing paper

Financial derivatives for printing paper-related items began trading at the Shanghai Futures Exchange on Wednesday. Total trading volume of offset paper futures for the day was 21,900 lots, with a turnover of 3.7 billion yuan (US$520 million).

Futures for offset printing paper, fuel oil, petroleum asphalt, and pulp were posted at 9am, while options for offset printing paper will be listed at 9pm.

Petroleum asphalt futures, as well as fuel oil, petroleum asphalt, and pulp options, were also added to Qualified Foreign Investors' trading programs beginning today.

"It is an excellent time for China's printing industry to advance toward high-quality development and become a paper power," said Xu Xiangnan, deputy Party secretary of the China National Light Industry Council.

"The trading of such key raw materials is well-timed and of great significance," Xu said, adding that it will serve as a practical financial tool for upstream and downstream firms, improve risk management across the business chain, and build the groundwork for China's cultural growth.

The printing paper-related industry, which is an essential part of the "light" industry in comparison to heavy industries such as machinery, is not light; its output reached 136 million tons in 2024, making it the world's leading producer and consumer for 16 consecutive years.

According to Fu Xiangsheng, vice president of the China Petroleum and Chemical Industry Federation, when market prices fluctuate, these financial derivatives can help enterprises navigate and better manage risks. The "futures plus options" format is a pilot marking a new stage in the sector's growth.

Yan Su, general manager of China Paper Investment Co Ltd, said that these financial instruments can assist businesses in anticipating and controlling costs, allowing them to transition to greener development, which is critical for the industry's long-term success.