Group A: Project Background - A company, located in Anhui Province, specializes in urea spot trading and has a downstream trading partner, B company, which signed a procurement agreement for 3,000 tons of urea to be delivered by May 2024 [1] - B company anticipates a price increase in the domestic urea market in May 2024 and plans to sign a "basis + spot price" procurement agreement with A company by the end of March 2024 [1] - A company aims to expand its business scale while being cautious about potential losses from unfavorable basis developments in Q2 2024 [1] Group B: Project Implementation Process - From April 2024, the urea futures market showed signs of stabilization, prompting A company to hedge part of its inventory based on market conditions [3] - B company completed the pricing of 3,000 tons of urea in early April 2024, purchasing in six batches at a favorable futures price [3] - A company also purchased 3,000 tons of urea in the spot market and executed a hedge of 150 contracts, achieving a reasonable overall profit despite low futures margins [3] Group C: Cost Reduction and Benefits - B company successfully reduced its procurement cost from over 2,200 yuan/ton to 1,984.89 yuan/ton by purchasing from A company in early April [4] - The "basis + spot price" model alleviated B company's liquidity pressure, allowing for flexible procurement without the hassle of traditional sourcing [5] - This model transformed absolute price volatility risks into relative changes in basis, stabilizing supply-demand expectations and business relationships [5] Group D: Effectiveness Evaluation - The basis trading model enables upstream and downstream enterprises in the bulk commodity sector to manage price volatility risks effectively, enhancing operational predictability [7] - The model has strong replicability and high social promotion value, benefiting the overall industry [7] - Futures companies can leverage this procurement method to better understand the spot market and tailor solutions to meet client needs, achieving a win-win situation [7]