Lingyuan Iron & Steel plans futures, derivatives for 2026 to stabilize operations

Lingyuan Iron & Steel Co., Ltd. announced on December 13, 2025, that its board of directors approved the 2026 financial derivatives business plan during a December 12 meeting. This plan, which is subject to shareholder approval, outlines the company's intent to conduct futures and derivatives transactions from January 1, 2026, to December 31, 2026. The primary objective is to hedge against price volatility in raw materials and steel products, thereby ensuring stable production costs and sales margins.

The company will focus on commodity futures related to its core business, including iron ore, coking coal, coke, ferromanganese, ferrosilicon, rebar, and hot-rolled coils. The planned capital allocation for these transactions will utilize up to 20m yuan for transaction margins and rights, with a maximum daily contract value of 285.7m yuan. The total investment for derivatives will be drawn from the company's own funds.

Lingyuan Iron & Steel emphasized adherence to strict internal control mechanisms, including a dedicated leadership group and risk management policies to prevent speculation and ensure that all transactions are for hedging purposes. The company has identified potential risks such as price volatility, capital, liquidity, internal control, and technical issues, and has established corresponding mitigation strategies. The plan also includes a proposal to authorize transaction personnel for the 2026 financial derivatives operations.