Close Menu
Invest Insider News
    Facebook X (Twitter) Instagram
    Wednesday, July 30
    Facebook X (Twitter) Instagram Pinterest Vimeo
    Invest Insider News
    • Home
    • Bitcoin
    • Commodities
    • Finance
    • Investing
    • Property
    • Stock Market
    • Utilities
    Invest Insider News
    Home»Commodities»China plans commodities overhaul to attract global investors
    Commodities

    China plans commodities overhaul to attract global investors

    May 27, 20254 Mins Read


    CHINA is on the cusp of its biggest move yet to open up its vast commodities markets, after the Shanghai Futures Exchange (SHFE) unveiled an internationalisation plan to streamline access for overseas investors.

    The country’s biggest raw materials bourse is soliciting views on a proposal to let participants post foreign exchange as collateral for yuan-denominated trades, according to a statement on Tuesday (May 27). Restrictions on foreigners and their capital are an oft-cited reason for China’s failure to punch its weight in international markets.

    The much-anticipated move would serve a number of purposes, including China’s long-held ambition to more directly influence the price of the imported commodities on which its economy relies. It would also help burnish the yuan’s appeal as an international currency to rival the US dollar in financial markets.

    SHFE, set up in 1999 and run by China’s government, offers trading in contracts from copper and steel to gold, crude oil and petrochemicals. The country is the world’s largest buyer of raw materials, but benchmark pricing for key commodities is usually set elsewhere, including New York and London for oil, London for base metals and Singapore for iron ore.

    “It’s time for yuan pricing to go global,” said Tiger Shi, managing partner at Bands Financial, who has been involved in China’s commodities markets for more than two decades.

    Earlier, more modest moves to open up commodities futures have had limited success. The Shanghai International Energy Exchange, a SHFE unit, has offered yuan-denominated copper to overseas participants since 2020, and a crude-oil contract since 2018, but neither has made much of a dent in the dominance of international exchanges. The Dalian Commodity Exchange opened up iron ore futures in 2018, and that has found more traction as a benchmark.

    BT in your inbox
    Newsletter Img

    Start and end each day with the latest news stories and analyses delivered straight to your inbox.

    The latest plan appears to go much further, by proposing sweeping changes to ease participation across 18 of SHFE’s domestic contracts. The exchange will overhaul rules on market access, trading, settlement, risk control and delivery to “systematically internationalise” trading, SHFE said. It has asked for public feedback by Jun 4.

    “This is welcome news,” said Zheng Jia, head of trading at Shanghai Soochow Jiuying Investment Management. “It will attract more diversified participants and boost liquidity, and will also connect Chinese prices more closely with overseas prices.”

    Price setting

    The proposals would serve the country’s broader opening-up strategy, while helping Shanghai to develop as an international financial centre and enhancing China’s influence over global commodities pricing, SHFE said.

    Chinese authorities have pledged to expand cross-border financial services in Shanghai, the nation’s premier commercial hub. A plan released in April vowed to help international investors become more deeply involved in trading platforms, and included a push to expand yuan-denominated pricing at the Shanghai Gold Exchange.

    “The future direction is to develop the yuan into a trade financing currency, or a funding currency,” said Tommy Xie, head of Asia macro research at OCBC. “An important function of any trade financing currency is the pricing of commodities.”

    Shi at Bands Financial said he expects nickel to be the first contract that SHFE opens up under its new proposals. He said the bourse’s plan will complement other steps to bridge the gap between China’s commodities markets and the rest of the world’s.

    The London Metal Exchange – owned by Hong Kong Exchanges & Clearing – is poised to add warehouses in Hong Kong to its global network. That’s aimed at giving businesses in mainland China an easier way to ship metal to the exchange, especially at times of market stress and major dislocations between Chinese and international prices. BLOOMBERG



    Source link

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Previous ArticleDow futures trade with losses ahead of FOMC minutes, Nvidia results
    Next Article China deflation worry deepens among economists after trade truce

    Related Posts

    Commodities

    Nebraska Farm Bureau announces new trade deal conversations with Asian countries

    July 30, 2025
    Commodities

    Glencore to cut costs by $1 billion and raises trading goal

    July 30, 2025
    Commodities

    360 ONE Asset’s new multi asset fund: All you need to know

    July 30, 2025
    Leave A Reply Cancel Reply

    Top Posts

    How is the UK Commercial Property Market Performing?

    December 31, 2000

    How much are they in different states across the US?

    December 31, 2000

    A Guide To Becoming A Property Developer

    December 31, 2000
    Stay In Touch
    • Facebook
    • YouTube
    • TikTok
    • WhatsApp
    • Twitter
    • Instagram
    Latest Reviews
    Bitcoin

    Bitcoin s’élève au-dessus du niveau de percée de 109 590 $

    May 25, 2025
    Stock Market

    Nasdaq and AWS partner to move markets to the cloud

    April 25, 2025
    Property

    China Banks Ramp Up Bad Property Loan Disposals to Boost Economy

    March 27, 2025
    What's Hot

    “Capitale mondiale des cryptomonnaies” : Donald Trump va ajouter le Bitcoin à l’économie des États-Unis

    March 2, 2025

    China’s property crisis claims more victims: companies

    October 10, 2024

    Podcast BFM Business – BFM Bourse avec Guillaume Sommerer.

    April 8, 2025
    Most Popular

    Markets on Edge: FTSE Index Dips Amid Tense U.S.-China Trade Talks

    June 9, 2025

    Are Bulls A Big Move?

    August 17, 2024

    Le Bitcoin en danger alors que les États-Unis ciblent les cryptos dans un nouveau projet de loi sur le climat

    April 13, 2025
    Editor's Picks

    China’s intellectual property exports up 17.7% year-on-year in first five months: CNIPA

    July 30, 2024

    Mt Gox Set For Large Bitcoin Repayment Ahead Ethereum ETF Launch

    July 22, 2024

    game changer pour les cryptos ?

    March 24, 2025
    Facebook X (Twitter) Instagram Pinterest Vimeo
    • Get In Touch
    • Privacy Policy
    • Terms and Conditions
    © 2025 Invest Insider News

    Type above and press Enter to search. Press Esc to cancel.