Future looks bright as trade booms
(Shanghai Daily)Updated: 2007-01-05 15:39 Turnover on China's futures markets rose to a record last year, with an on-year increase of 56 percent.
The boom was spurred by active trading for commodities like rubber and corn
as the country gradually emerges as a global pricing center.
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In 2006, turnover on China's three futures exchanges eclipsed 21 trillion yuan (US$2.62 trillion), the highest since the country started futures trading in 1990.
Trading volume rose 39 percent to 449.5 million lots, according to the China Futures Association.
Natural rubber contracts on the Shanghai Futures Exchange became the most traded commodity by trading value on turnover of 5.6 trillion yuan.
Corn contracts on the Dalian Commodity Exchange were the most actively traded by volume, with 135 million lots.
"For corn, the prices increase in Dalian was about half of the benchmark on the Chicago Board of Trade," said Wu Xing, an analyst at China International Futures Co. "This shows we are forming our own price while integrating into the global markets."
The Shanghai bourse was the busiest of the three, with turnover surging 92 percent to 12.6 trillion yuan and accounting for more than half of China's total. The copper contracts traded in Shanghai have become as important as those on the London Metal Exchange in global price setting.
Analysts said the robust growth could continue this year as China boosts launches of new products to meet the demand for hedge tools.
The China Securities Regulatory Commission in November issued draft regulations requiring futures firms to maintain adequate capital and management skills before the introduction of commodities like crude oil contracts, and derivative financial products, such as stock index futures.
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