Core Insights - The article discusses the transformation of the commodity trading industry in China, highlighting the shift from traditional trading models to integrated supply chain management services, driven by market dynamics and the need for risk management [1][2][3]. Industry Evolution - The commodity trading sector in China was initially characterized by rapid growth and a lack of information transparency, with many traders relying on traditional "buy low, sell high" strategies for profit [2]. - The 2008 global financial crisis exposed the vulnerabilities of these traditional models, leading to significant losses for traders as commodity prices plummeted [2][3]. - Increased market transparency and competition have pressured traders to evolve, as clients now demand more than just basic supply services, seeking stability in pricing and cost control [3]. Risk Management and Transformation - The development of China's futures market has provided traders with new tools for hedging price risks, prompting many to establish risk management departments and adopt a "spot-futures" combined operational model [3][4]. - Traders have moved beyond simple hedging to create diversified risk management systems that include basis trading and options, enhancing their competitive edge [4][5]. Integrated Service Ecosystem - The integration of warehousing and logistics into the trading model has become essential for enhancing service efficiency and creating value within the supply chain [7]. - Traders are building comprehensive service systems that combine trading, warehousing, logistics, finance, and information services, transitioning from "spot-futures operators" to "integrated service providers" [7][8]. - The establishment of smart warehousing and logistics networks has improved inventory management and service delivery, while also enabling traders to offer financial services to clients [7][8]. Global Competitive Landscape - As the Chinese economy becomes more integrated into global supply chains, traders recognize the need to enhance their global resource allocation capabilities to compete with international giants [9]. - The combination of risk management through financial tools and a robust physical network has become a key strategy for traders to maintain competitiveness in cross-border trade [9]. Future Outlook - The uncertainty in the commodity market is expected to persist due to geopolitical tensions, climate change, and technological advancements, necessitating continuous innovation and adaptation by traders [10]. - By focusing on empowering the real economy and enhancing service offerings, traders can achieve sustainable growth in a complex market environment [10].

Core Insights - The article discusses the evolution of commodity trading from "Trade 1.0" to "Trade 2.0" and now to "Service 3.0," highlighting the importance of risk management in the current market environment [1][2][10] - Companies like Jiayue Commodity Group and Zhejiang Hangshi Shancheng are leading this transformation by integrating futures tools into their service offerings, providing clients with risk management solutions [2][3][4] Group 1: Industry Evolution - The transition from "Trade 1.0" to "Trade 2.0" was driven by the need for effective risk management tools to combat price volatility and market uncertainties faced by enterprises [1][2] - The current "Service 3.0" era focuses on providing comprehensive solutions that integrate logistics, finance, information, and technology, allowing for end-to-end service offerings [7][10] - The rise of geopolitical tensions, global monetary policies, and environmental strategies has intensified the need for companies to manage price risks effectively [2][5] Group 2: Company Strategies - Jiayue Commodity Group has embedded a futures-based approach into its operations, allowing it to serve as a risk management consultant rather than just a trader [3][4] - The company aims to create value for clients by transferring risks through futures tools and focusing on identifying and exploiting price discrepancies within the supply chain [4][8] - Hangshi Shancheng emphasizes a research-driven approach, integrating supply and demand analysis with flexible futures and options strategies to address client needs [10][11] Group 3: Risk Management Practices - Companies face three main risks: rising raw material costs, inventory devaluation, and narrowing price differentials, all of which can threaten profitability [5][6] - Effective risk management has become a core competency, with firms needing to shift from profit maximization to operational stability [2][10] - The use of basis trading and options embedded in contracts allows companies to manage price risks while maintaining operational flexibility [8][9] Group 4: Future Outlook - The increasing availability of futures products is expected to enhance risk management capabilities across various industries, making it a fundamental aspect of business strategy [13][14] - As companies evolve from passive risk bearers to active risk managers, the role of service providers will also deepen, necessitating customized solutions for clients [13][14] - The integration of a robust derivatives market with solid industrial foundations is crucial for building resilient supply chains and enhancing the overall stability of the economy [14]