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  • 8.6.1-FUTURES MARKETS-TOKYO COFFEE FUTURES - AN OVERVIEW

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  • Tokyo coffee futures - an overview

     
     

    Futures trading in rice started as early as 1730 in Japan. In 1893 Japan enacted the Exchange Law giving birth to the Tokyo Rice Exchange, which traded rice, cotton, sugar and raw silk futures. The present-day Tokyo Grain Exchange (TGE) was formed in 1952 and merged with the Tokyo Sugar Exchange in 1993. It had a membership in 2003 of 76 firms, known as Futures Commission Merchants or FCMs. Trading in arabica and robusta futures started in June 1998. As yet options are not traded.  

    TGE's website is  www.tge.or.jp .

    The exchange is open to foreign participation through non-resident FCMs provided these are members of their own national futures exchange or are registered with a government regulatory authority such as the United States Commodity Futures Trading Commission. Non-resident FCMs must operate through an exchange FCM with whom they have opened an account.

    The contract units clearly demonstrate that this is a futures market designed for an importing country with many types of buyers, ranging from large to very small. The contract unit for arabica is just 50 bags of 69 kg, or 3,450 kg. The delivery unit though is 250 bags, or 17,250 kg. For robusta the contract unit is 5,000 kg and the delivery unit is 15,000 kg. The minimum price fluctuation is equivalent to 500 yen per lot (arabica and robusta).