Yunnan will eventually have only one trading center

In fact, behind the game between the two sides, the birth of Yunnan Coffee Trading Center still faces great policy risks. According to relevant media reports, since July, more than 30 exchanges across the country have been suspended or reorganized, including the "Zhongjing Commodity Exchange Market" and the "Qingdao International Commodity Exchange".

At the end of June this year, China Securities Regulatory Commission issued the Notice on Carrying out On-site Inspection of Various Trading Places (known as "Document No.28" in the industry), which directly led to the suspension or reorganization of more than 30 trading places nationwide in July. This means that the national exchange rectification storm is coming again. As early as July 2012, the State Council issued the Implementation Opinions on Clearing up and Rectifying Various Trading Places. The background of the policy was that the exchange construction upsurge was set off all over the country before, and the financial risks accompanying it began to be exposed. Subsequently, the State Council issued several documents successively to start rectification.

According to Li Xiang, until now, the rectification of the exchange has not ended. Therefore, Yunnan Coffee Trading Center may face more difficult approval, and at the same time, the threshold of trading center is also being raised.

Generally speaking, the approval authority of the trading center has been reduced to the provincial level, and if it is an exchange, its approval has been upgraded to the CSRC. At the provincial level, it is difficult to approve two coffee trading centers at the same time. Li Xiang also said,"If there are two coffee trading centers in one area, it is not good for anyone, it will only hurt each other and disperse trading resources."

Under the competition between the two sides, many insiders put forward a point of view, why can not the two cooperate? Shu Yang did not respond positively to this, but said: "We do not refuse any cooperation." Hu Lu also said: "At present, the government is studying, and now there are all kinds of possibilities."

Yunnan's enthusiasm for establishing a coffee exchange has soared

According to public reports, Hougu Coffee Co., Ltd. and Yunnan Xiaoguan E-commerce Technology Co., Ltd. reached an agreement to establish Yunnan Coffee E-commerce Trading Center as early as 2012 at the Coffee Culture Festival held in Mang City, Dehong Prefecture. Subsequently, the product of their cooperation, Yunnan Jupiter Coffee E-commerce Trading Center, was listed in Kunming Economic Development Zone. It is understood that the trading center was still building relevant trading networks at the end of last year. But a week ago, the reporter called Yunnan Xiaoguan E-commerce Technology Co., Ltd., one of its relevant responsible persons said that the project has aborted. But Mr Hu said: "It was just a trial run by coffee companies and some experience was gained, but trading is not active at the moment." It is worth noting that, according to media reports at that time, the signing of the cooperation project agreement was witnessed by the Provincial Department of Commerce, and according to the statement at that time, through the establishment of the e-commerce trading center, Kunming will be built into the world's third largest coffee futures trading center after New York in the United States and Hamburg in Germany in the future.

Yunnan Province Coffee Industry Association also said at a news conference on July 16 that in addition to the two coffee trading centers listed almost at the same time, it is not ruled out whether there will be a third or more "Yunnan Coffee Trading Institutions" established. This seems to mean that the enthusiasm of the coffee industry as a whole, and even outside the industry, for setting up a coffee exchange in Yunnan has soared.

However, after several years of coffee industry development, the coffee trading mode in Yunnan Province is still relatively traditional at present. Nestle and Starbucks have set up acquisition points in Pu 'er. In Dehong Prefecture, Hougu Coffee is also the main one, and some traders of large and small are distributed at the same time. This is also basically the case in Lincang and Baoshan producing areas. The trading behavior of the whole coffee industry is mostly carried out by traders, one of which is the New York coffee futures market, and the other is the quotation given by Nestle Company, which has been entrenched in Yunnan for many years. In particular, the existence of some small traders, price hikes and price hikes exist. When coffee prices are good, coffee buying companies and middlemen generally buy coffee from farmers 'homes, while once prices are poor, coffee farmers basically deliver coffee beans to the purchase point themselves. However, farmers 'understanding of market prices is not comprehensive.

The consensus of many coffee industry personages is that Yunnan coffee industry has experienced many years of development and needs an exchange to promote coffee industry to a higher level and improve coffee circulation efficiency. In the longer term, coffee exchanges will trade in coffee futures after spot trading. At the same time, on the basis of pooling more industry resources, Yunnan Coffee wins the right to speak.

Li Xiang, who has been engaged in trading market management for many years, said in an interview with reporters: "The industry can realize that it is a good thing to do an exchange. From a business point of view, everyone wants to do an exchange, because this money is too easy to earn." But in terms of financial policy, it's hard to do right now." And in his view, a province at most will only approve a sub-industry trading center, the future who can get policy support is not certain.

No matter who built it or where it was built. The bigger question is, how do you build it? In particular, the design of trading models is crucial to the long-term development of exchanges.

A Study of Trading Patterns

At present, although the coffee exchange construction competition is fierce, but the trading mode of both sides is not clear, only put forward the general direction.

Shu Yang frankly said: "At present coffee trading center trading mechanism is still in design, after all coffee and flowers or different." The approximate model mainly revolves around three points: first, there should be a collection mechanism, which is mainly to protect the interests of farmers when prices fluctuate violently. Secondly, starting from spot trading, focus on creating fine coffee at the same time, so that good quality coffee beans realize their due value. This will also rely on the trading center platform, joint professional brand building team, brand building and planning. Thirdly, risk control, all trading mechanisms involved will be in strict accordance with the requirements of laws and regulations, do a good job of risk control. "Especially at the promotion level, relying solely on the government to do it, some market behaviors are not consistent, but if a platform such as the trading center is used, it will be very convenient," Shu Yang said.

It is mentioned in a group of recruitment information of Jinyuan Flower that Yunnan Coffee Trading Center will consist of a headquarters, three cargo collection centers and a delivery warehouse. Yunnan Coffee Trading Center headquarters, electronic public trading service platform, storage and delivery center, coffee cup laboratory and barista training base will be built in Pu 'er City, coffee primary processing collection centers will be built in Lincang, Baoshan and Dehong, and coffee storage and delivery warehouse will be built in Kunming. The total investment of the project is RMB 750 million yuan.

In addition, Shu Yang also said, Through the trading platform, Will also extend to coffee seed, planting, processing, Logistics information, Packaging and other services, Especially in the planting level will provide more help to coffee farmers. In fact, such an idea mainly comes from the existing model of Jinyuan Flower.

"We want to be like Alibaba, just build a platform and not participate in the transactions." Including Jinyuan Flower, it is also transforming from a flower producer to a service provider. In addition to the holding subsidiary Kunming National Flower Auction Center, Jinyuan Flower is currently involved in the testing and promotion of new flower varieties, modern flower plantation parks, full-process cold chain services, flower financial services, etc. Jinyuan Flower is now more like a comprehensive flower public service platform." At the same time, Shu Yang also said that it took 20 years for Jinyuan Flower to change from a grower to a service provider. Now it takes time to precipitate and accumulate to become a coffee service provider." He also stressed that building a trading center is not a matter of who leads who, but more of a service platform.

As the president of the Coffee Industry Association, Xiong Xiangren also put forward his own views on the design of the trading mode of the coffee trading center. First of all, after the establishment of the headquarters in Kunming, sub-centers will be set up in each coffee producing area, where farmers can choose the transaction price. The specific practice is that if the coffee farmer is not satisfied with the transaction delivery at that time, he can deliver the coffee beans to the coffee trading center, and then get the payment according to 70% of the price of the day. After the coffee beans have the ideal price, he can make up the coffee payment according to the price of the day. Secondly, the platform will package the whole to apply for financial credit from the bank, through which both coffee farmers and coffee enterprises can apply for loans. According to Xiong Xiangren, the bank financial credit that the whole platform can apply for can reach 3 billion yuan. In addition, coffee wealth management products can be sold to investors through the platform.

According to Hu Lu, deputy secretary-general of the coffee industry association, the coffee trading center will be jointly owned by a number of coffee enterprises and operated by the company system. At the same time, the platform will set the minimum purchase price of Yunnan coffee, which is temporarily set at about 15 yuan/kg. "The alliance of many enterprises will enhance the risk resilience of Yunnan coffee industry and gain certain voice in the market." Hu Lu added.

Competition for pricing power and interests behind it

Behind the exchange competition, the essence is the competition for pricing power and interests behind it.

The direct purpose of establishing an exchange is to form a market mechanism for commodity prices through centralized trading. Once this price forms an authority, coffee enterprises participating in it can only accept such pricing. There is no doubt that all parties involved in the establishment of the coffee exchange now want such a generation mechanism to be within their control.

Take Kunming Pan-Asian Nonferrous Metals Exchange as an example, through years of operation, it has global pricing power on many small metals, thus forming a significant influence on the industry.

More importantly, there are huge commercial benefits behind the exchange's boom. "The exchange generally makes money through the handling fee of the transaction, similar to the mechanism of" toll fee ". The size of the transaction flow will determine the size of the earning ability behind it. Of course, this is closely related to the trading mechanism, whether it is physical trading or futures trading," industry insiders pointed out.

The above-mentioned people said that although the two most well-known exchanges in China, Shanghai Stock Exchange and Shenzhen Stock Exchange, are not for profit, and the transaction handling fee ratio of Shanghai and Shenzhen Stock Exchange is only 0.015% in both directions, due to their huge trading volume, there are huge profits every year. Take Shanghai Stock Exchange as an example, where so many enterprises gather, its annual tax payment ranks high. Although the exchanges in the industry cannot achieve the scale of the two major exchanges, once the trading boom, the handling fees behind it are still very considerable.

The reporter inquired about the profit data of large domestic exchanges. According to some data, in 2013, CICC paid only 1.324 billion yuan in tax, ranking 22nd, ranking the highest among Shanghai exchanges; the tax paid by the previous exchange was 1.233 billion yuan, ranking 26th; the tax paid by Shanghai Stock Exchange was 868 million yuan, ranking 37th; and the tax paid by Shanghai Gold Exchange was 527 million yuan, ranking 88th.

"In terms of trading mode, the mode of exchange is undoubtedly the most advanced, representing the price mechanism commonly recognized by a wide range of market participants, and its influence is also difficult for a single enterprise to match. Compared with planting, production and circulation, it has stronger ability to make money, so it is normal for all parties to compete," financial industry insiders told reporters.

But the significance of establishing an exchange does not stop there. "The exchange can also obtain bank credit, which is an extension of the exchange's services. At the same time, for enterprises, the exchange is also a huge brand benefit, which is a very cost-effective thing. For example, if you invest 10 million yuan in an exchange, the advertising effect may be better than 10 million advertisements. A leading enterprise builds an exchange, commodity production, trading center forms an economic center, can develop into a financial center, if in these centers can play a very important role, it is very cost-effective for enterprises,"trading market insiders pointed out.

In fact, for local governments, it is also more desirable to build trading centers locally. Li Xiang told reporters: "The establishment of a trading center can pool funds from all over the country and promote the development of local governments. At the same time, the tax revenue generated by a trading center with influence in the whole country is also considerable."