A customer chooses seafood at a supermarket of Bailian Group in Shanghai. The company is setting up a commodity trading platform targeting sales of a trillion yuan. (Photo by Wang Gang/For China Daily)
Firm expects Shanghai unit to provide diverse solutions to other enterprises
An online e-commerce platform for commodity trading that aspires to become an internet-based information and transaction hub with a trillion-yuan ($151 billion) in target was established in Shanghai on Tuesday, making it one of the first to offer customized real time information services for the trade.
The platform, Shanghai Bailian Commodity E-commerce Co Ltd, is the commodity e-commerce arm of Shanghai's State-owned conglomerate Bailian Group.
"The Bailian Commodity E-commerce Co aims to become a service provider that offers a wide range of services that cover information, pricing, transaction, settlement, logistics and supply chain financing," said Xu Ziying, president of Bailian Group.
Zhou Jiayu, managing director of Shanghai Bailian Commodity E-Commerce Co, said that the platform aims to synergize resources of other Bailian arms including retail and financing to provide commodity sellers and buyers one-stop solutions that help in decision making.
"Very often commodity trade platforms are regarded business-to-business hubs. In practice, it is decision makers, or individuals facing real situations instead of an abstract company that needs the information the most. So we are creating this platform to cater to people's needs and helping them get access to transparent data when making informed decisions", said Zhou.
The platform features fast and accurate transactions that enable order placements in 30 seconds. It takes one second to respond to existing orders. Conventional transactions and settlements that would take three days can be completed in just half an hour at the platform, according to company officials.
The platform focuses on only spot goods and is not operating in futures, and the major products transacted are oils and petroleum products, said Zhou.
Li Wenzhe, deputy managing director of Shanghai Zhongshan Chemicals Market, a chemical commodities trading hub, said that the online e-commerce commodity platform would help the conventional brick-and-mortar market to become more efficient.
"Trading would be much easier thanks to one-spot solutions. For example, shipment and settlements are trackable online, making everything transparent and immediate. Supply chain financing would also help smaller players to operate with more ease," he said.
According to a research report by OCN.com, an industry research services provider, the country has more than 1,200 commodities e-commerce platforms on the mainland, and annual transactions are expected to exceed 30 trillion yuan in 2017.
"Growing number of platforms shows that commodities market's demands are not yet fully met, and competition has just started. In the future, platforms will be more consolidated," the report said.
Shanghai is planning to have several hundred billion-yuan and trillion-yuan level trading platforms, a goal it expects to reach by the end of 2020, according to its latest five-year plan.
Bailian Commodity E-Commerce is aspiring to be one of the mega-platforms, said Zhou.