Research On The Effectiveness Of Steel Futures Market In Serving Steel Industry In China

Steel industry has always been the mainstay of China’s economic development.As an important raw material and industrial skeleton in national production and life,steel products account for a large proportion in China’s production.However,even as the industry leader,the steel industry has been affected by costs,demands,policies and other factors in recent years.In particular,under the price of steel soared and fell sharply,steel enterprises have suffered more severe economic losses.In order to improve the loss situation of steel industry and protect economic interests,how to use steel futures market to effectively avoid market risks is particularly important.Whether the listing of steel futures such as rebar can effectively serve the steel industry and how to serve the effect has become the focus of this paper.This paper analyzes the service effect of hedging function of steel futures market on steel upstream and downstream enterprises and empirically tests whether steel futures price can effectively guide the formation of steel spot price.Through to the steel mills by means of hedging the futures market buying and selling help enterprises to achieve the purpose of the actual case analysis,can be found in steel futures market hedging operations can help steel mills in the very great degree locking cost and profit,avoid the spot market price fluctuations risk,to speed up the enterprise cash flow rate,make steel mills can reasonable arrangement of the production scale,improve the efficiency of production and operation,promote industrial structure optimization.For steel the service effect of the futures price guiding spot price,this article selects 2245 group rebar futures and spot prices,through the establishment of the VAR model and VECM model empirical analysis of the relationship between the futures price and spot price,using the Granger causality test,impulse response function and variance decomposition analysis further inspection leading relationship between the price of steel futures and spot market,the empirical results show that when the futures and spot prices deviate from the long-term equilibrium,mainly by rebar spot price correction,however,the price discovery function of futures market has not fully played its guiding role.Analysis think that this is due to steel industry itself,the low industrial concentration,the lack of excess production capacity,profit ability and speculative excess steel futures market,investors are not completely rational,not according to the macro economic and market expectations price to make a rational judgment,lead to cannot give full play to the steel futures price discovery function,unable to guide the spot market price formation.Finally,on the basis of cases and empirical analysis,this paper puts forward constructive policy suggestions and prospects on how the steel futures market can further effectively serve the steel industry,hoping that China’s steel industry and steel futures market can achieve long-term and effective development.