Commodities

China to launch long awaited international copper futures on Nov. 19

China's securities regulator said on Friday it had approved an international copper futures contract for launch on Nov. 19, in a move that will give foreign investors access to trading in the world's top consumer of the metal.

Updates with background

BEIJING/SHANGHAI, Oct 23 (Reuters) - China's securities regulator said on Friday it had approved an international copper futures contract for launch on Nov. 19, in a move that will give foreign investors access to trading in the world's top consumer of the metal.

Gao Li, a spokeswoman for the China Securities Regulatory Commission, announced the launch date for the contract, which will be traded on the Shanghai International Energy Exchange (INE), at a weekly news briefing.

The INE copper contract has been much awaited by foreign investors looking to hedge exposure in China. The Shanghai Futures Exchange (ShFE), which owns the INE, has a domestic copper contract SCFcv1 but it is not accessible to foreign market participants.

The exchange published a draft of the international contract on its website last week, seeking public feedback on the proposed trading, delivery and risk management rules. The planned contract size will be five tonnes of copper cathode per lot - the same size as the ShFE contract - but the quoted price in yuan will exclude tax and customs duty.

The INE had earlier said on Wednesday it would hold two weeks of mock trading for the new contract from Oct. 26 to Nov. 6., a common practice by Chinese exchanges before a live launch.

China has so far internationalised five commodities futures contracts as part of its ambitions to become a commodities pricing power: crude oil, TSR 20 rubber, low-sulphur fuel oil, iron ore purified terephthalic acid (PTA).

Foreign investors currently have limited access to China's sizable commodities markets.

(Reporting by Jenny Su and Emily Chow; Additional reporting by Tom Daly; Editing by Mark Potter and Kim Coghill)

((tom.daly@thomsonreuters.com; +86 10 5669 2119;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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