SPOTLIGHT: China's latest move on futures spurs hopes for LME warehouses

China is preparing to open its futures markets to international investors, to help its economy cope with global price fluctuations.

The step is seen as a natural progression from China’s opening up of its physical economy and markets through free trade zones, new products, changes in the country’s regulatory and legal framework, and the internationalisation of its currency. Recently, Metal Bulletin sister publication Futures & Options World (FOW) reported that the Chinese regulator is developing a legal framework to open up the country’s futures markets to international investors. “China is becoming more dependent on foreign resources,” said Zhou Lichao, China Securities Regulatory Commissions’ division director, supervision division III, department of futures supervision, speaking at FOW’s Derivatives World Asia event. “If the futures market does not go global, commodity pricing cannot be efficient, leaving domestic trading participants less protected from price fluctuations in the global market,” he said. The regulatory shift in futures has once again highlighted the potential for LME warehouses in China. LME warehouse issue Hong Kong Exchanges & Clearing (HKEx),...


Linda Lin

Shivani Singh

March 27, 2015

14:34 GMT