INE, the exchange where CoFIF contracts are being traded, doubled the transaction fee for the second time during the last two weeks to 0.02% and cap the trading volume at 500 contracts per day, another attempt to cool the short-term trading activities. Each CoFIF contract is priced as Rmb50 x the SCFIS. So 500 CoFIF contract cap amount to about $2.7mn. Despite being halved, the liquidity remains very high after the new policies kicked in. The transaction fee started at 0.001% at CoFIF's launch
CoFIF trading stays red hot despite of the continuous decline in the FE-NEUR spot rates. Prices for all 5 CoFIF contracts were down 5-7% WoW but the CoFIF were still trading at 20-40% premium to the spot. Trading volume made new high on Friday with close to 500,000 contracts changed hands despite the exchange doubled the transaction fees on Thursday. It is the second time in less than 2 months that the INE has increased the transaction fees. The turnover-to-OI ratio now stayed high at 5x as th
It should have come as a surprise to the liner managers in the container shipping industry is that the CoFIF has been rallying since China is back from its national holidays. As the liner managers are struggling to sell $1,000/FEU to their customers in current round of 2024 contract negotiation. There are buyers in CoFIF markets willing to pay something like $1,300-1,500/FEU for shipments embarking between April and December next year. But most of the liner managers do not know CoFIF. The two
Trading in China ended on Thursday last week as markets in China closed from 29 Sep to 8 Oct for national holidays. Prices of the CoFIF came down between 12% and 20% WoW, benchmarking the physical market where spot rates for FE-NEUR are plummeting as players are entering into the bidding season for the 2024 contracts. SCFI was just below $600/TEU at market close last week but actual going spot rates could be already much lower. Average daily trading volume last week rebounded by 1.5 times back
One month in, the Container Freight Futures Index (CoFIF) were up 13-26% while the spot freight rates were down by 30%. For the trading interests in CoFIF, trading volumes has been down by 58% but open interests have been tripled, meaning less day-trading while more positions taken on longer term views. Last week, the prices of CoFIF continued to drip while suffered another big drop. However, the price for CoFIF is still surprisingly resilient, in our view, given uncertain economic outlook for
CoFIF closed last week (15 Sep) down 1-3% in price and down 47% in trading volume. Daily turnover dropped below $1bn for the first time since CoFIF launch on 18 Aug. Open interests, the balance of CoFIF that traders hold overnight, was up 9% WoW. The influx of liquidity on 5 Sep turned out to be due to one trader’s irregular position building that has been stopped by the exchange as per a notice published in INE’s Chinese website after market close on 5 Sep. To raise barrier for irregular tradi
CoFIF closed another week up only 1-3% across its 5 contracts while average daily turnover was up 46% WoW back to $1.9bn a day. Although the spot SCFIS reported 8% WoW drop after market on 4 Sep, the CoFIF market saw a huge boost of liquidity the next day (5 Sep) where total trading volume jumped to 400,000 lots, the highest since the launch of CoFIF, while the price of most traded contracts, EC2404, went up 7% for the day. Though, the market quickly gave up most of those 7% gains in the follo
The CoFIF container freight futures closed mixed at the end of its 2nd trading week on 1 September with short dated contracts holding relatively better than the longer dated contracts, after taking a dip on 28 Aug. The North Europe EC2408 contract remain in contango at 1,010 relative to the SCFIS spot level of 975 last week, and the latest SCFIS reading of 897 as at 4 September. Although average trading volume dropped 30% WoW to $1.3bn, it remains highly liquid compared to other container freig
After nearly 6 years of suspension, container freight futures are returning to the Shanghai market today. The turnover reached Rmb3.8bn ($500mn) in the first 30 minutes of trading, which is similar to the weekly freight revenue of the FE-NEUR route. source: BANDS FinancialThe product is now called Containerized Freight Index Futures (CoFIF). This product is being traded at INE (Shanghai International Energy Exchange), a subsidiary of Shanghai Future Exchange and is regulated by CSRC (China Sec