(Yicai Global) Sept. 18 -- The Dalian Commodity Exchange is to upwardly revise the margins on two types of corn futures by one percentage point next week to curb speculation as the price of corn has surged by 30 percent already this year.

The proportions of margins in contract hedging and speculative transactions of corn commodity futures will be adjusted to 7 and 8 percent, respectively, from the current 6 and 7 percent from Sept. 21, the DEC said yesterday. The move increases the deposits made to the exchange, which it will keep in the case of any losses, and the cost of holding these futures.

The DCE is the only exchange in China that trades corn commodity futures and options. Gross sales of such futures reached CNY1.96 trillion (USD290 billion) in the first eight months of the year.

Today the price of corn commodity futures reached CNY2,482 (USD367) per ton as of 2.10 p.m., a gain of 2.1 percent in a single day, and setting a new high since June 2015.

Spot market traders are betting on a shortage of corn after extreme weather damaged large swathes of the crop across China. The country’s pig husbandry sector is also recovering from an outbreak of African swine fever that decimated hog herds in late 2018 and last year, which should lead to a spike in demand in the second half.

The impact of the typhoons should not be over-interpreted and traders need to have a more rational view, a market insider told Yicai Global.

Northeastern Heilongjiang province, a major corn-producing area, will go ahead with its harvest in 10 days time, the province’s agricultural administration said on Sept. 16. Three major storms that hit Heilongjiang last month had only limited impact.

Editors: Dou Shicong, Kim Taylor