ZHENGZHOU, March 2 (Xinhua) -- Yan Chunguang, a hen farmer, is constantly checking an app on his phone that tells him the real-time changes in egg futures prices.

"I never imagined that my ten thousand hens would be associated with all these numbers," said Yan, who owns the largest hen house in Zhangzhuang Village, Lankao County in central China's Henan Province.

China approved the trading of egg futures in 2013 in the hope that futures trading can help stabilize egg prices by increasing liquidity in the market and offer companies more hedging tools to promote the healthy development of the egg industry.

In January this year, an "insurance plus futures plus banking" project, an upgrade from the former "insurance plus futures" project was started in the village to bring loan services to extend the reach of financial services into the rural area and protect egg farmers from the volatility of the market and help them expand their operations.

The "insurance plus futures" hedging project came as China launched the world's first apple futures in December 2017 to help growers hedge against risks amid price fluctuations.

In late January, Yan's cooperative insured 176.4 tonnes of eggs for one month under the hedging project.

During that period, egg sales were met with an abysmal season, and the price dipped below the target price at which the eggs were insured. Yan's cooperative will receive a reimbursement of 118,000 yuan (17,650 U.S. dollars) for its losses from the insurance company next week.

"The new project will be effective in neutralizing risks during the hen rearing period and tackling the issue that farmers are unable to obtain a loan for want of collaterals," said Qiao Jianghong, general manager of Capital Jingdu Futures.

With the price having been shielded from fluctuations, banks are now more than willing to give out loans to those who have their eyes set on expansion.

"The agricultural sector is particularly susceptible to the swings of natural and market conditions," said Zhang Angang, deputy head of the Lankao county branch of Postal Savings Bank of China. "But the advent of 'insurance plus futures' project has insulated farmers from those risks and enabled them to earn a steady income."

Through the upgraded version of the hedging project, the bank has lent more than two million yuan to egg farmers in the village.

Zhang Heping, an egg farmer in the village waiting for his loan application of 50,000 yuan to come through, also considers himself a beneficiary of the project.

China has been stressing the role that financial services play in the real economy and issued futures contracts for commodities including white sugar, soybeans and cotton.

The "insurance plus futures" project was included in the "No. 1 Central Document," the first policy statement released by central authorities each year and seen as an indicator of policy priorities, for four consecutive years.

"All the products of hen rearing households in the village are 'gold plated' by the financial instrument", Yan said.