What is GDT trading activity
GDT trading activities provide a mechanism to connect buyers and sellers from all over the world. It spurs product sales twice a month so that demand continues to be supplied.
By doing this, GDT trading activities can discover fair market prices and protect both parties from making mistakes.
How trading activities work
GDT trading activities provide a series of dairy raw materials from sellers around the world.
- The seller can provide the product within six different delivery time periods (called contract periods). Each contract period represents the month of shipment.
- Before each trading event, the seller will announce the quantity of each product to be sold.
- In the trading activity, the buyer of the GDT trading activity obtains the quantity to be purchased during each contract period through several rounds of bidding.
- Buyers bid by entering the quantity they wish to purchase at the price announced in that round.
- For bidders who cannot participate in the transaction in person, there is an automatic bidding option.
- If the bidders cannot participate in the entire process of the transaction, they must participate in the first round of transactions, and can only maintain or reduce their total bids from that round.
- At the end of each round, the total demand will be calculated. If demand exceeds supply, the transaction manager will calculate the price increase for the next round.
- The price increase process in turns will continue-after each round of price increase, bidders need to submit the quantity they wish to purchase.
- The price rises until the demand equals the quantity supplied.
- At the end of the last round, the final price will be the winning price that all bidders will pay.
- This is the published market price.
- Each trading activity usually lasts about 1.5-2.5 hours.
The process of trading activities is like this ...
Process after the completion of the trading activity
The results of the trading activity are posted on the global dairy trading website, including the price index, number of bidders, and the percentage change in the price of each product from the previous trading activity.
In the next few days, the seller will contact the buyer to complete the contracting process, and the product will be shipped through the seller's standard logistics process.