Research On The Hedging Design Of Methanol Futures In H Chemical Company

In recent years,China’s financial market has developed rapidly.The futures market,which serves enterprise price discovery and helps enterprise risk transfer,has developed rapidly in China.At present,the tradable products developed by China’s major commodity futures exchanges cover almost all raw materials and finished products for industrial production,which provides a good financial tool for enterprises to transfer price risk.Large and medium-sized enterprises have long used financial derivatives such as on-site and off-site commodity futures and options for risk hedging.However,small and micro enterprises have rarely participated in futures market transactions due to their business focus on production and sales and the lack of risk management institutions.They cannot use financial derivatives such as commodity futures,options,forward and other off-site futures options to hedge the price risks faced by enterprises.H chemical company is a small enterprise with leading domestic technology in the production of pesticide related reagents.The procurement of raw materials such as methanol and bromine for production is still in the state of spot procurement,which can not be effectively avoided in case of price risk.This paper takes H chemical company as the research object,designs the enterprise hedging scheme within the framework of national policy according to the relevant theories of hedging.The paper mainly includes five parts.Firstly,it expounds the background,purpose and significance of the research,combs the relevant literature of enterprise hedging research,puts forward the research content and framework of this paper,and analyzes the innovation and shortcomings of the research.The second part expounds the hedging theory based on which this paper is based.Thirdly,it analyzes the necessity of H chemical company to participate in methanol futures hedging from the perspective of policy support and enterprise demand.Fourthly,it designs the hedging scheme of H chemical company,selects the quantitative analysis method to calculate the risk exposure of H chemical company,describes the selection of contract,and designs the optimal hedging ratio.Finally,the research conclusion is drawn.The research results of this paper include six parts.First of all,the State supports enterprises to use futures for price risk transfer.There is a risk of rising and fluctuating prices of raw materials methanol and bromine required by H chemical company in production.Therefore,it is necessary to hedge.Second,the calculation shows that the change of raw material cost price of H chemical company has a high correlation with the price change of the main methanol contract of Zhengzhou Commodity Exchange.This contract can be used to transfer the raw material cost risk for the enterprise.Third,according to the company’s raw material price risk exposure and the company’s product ratio,it is calculated that the optimal hedging ratio is 0.846,and the most suitable contract is the monthly deliverable ma205 contract.Fourth,from the perspective of hedging effect,the average price after hedging can be 214.03 yuan /ton lower than the annual procurement budget.Fifth,when hedging,enterprises also need to improve the awareness of risk prevention and strengthen personnel training,so as to stabilize production and increase income.The futures market provides a good financial tool for managing the price risk of enterprises.This paper attempts to use the existing hedging research results and design the hedging scheme according to the production practice,which is an attempt to apply the hedging theory to the practice of enterprises.It is hoped that the research results of this paper can provide a reference basis for small and micro enterprises to design hedging schemes and transfer price risk.