Across The Border | China urged to play bigger role in setting global commodity prices

As China pledges to internationalise its futures markets, the country should open commodity futures trading to foreign participants and play a bigger role in setting global prices for metal, energy, and agricultural commodities, according to industry players and analysts.

The China Securities Regulatory Commission (CSRC) recently announced plans to allow more overseas industrial companies to participate in the mainland’s commodities futures market in order to improve pricing.

Fang Xinghai, a CSRC vice chairman, said authorities will launch new futures products this year, including crude oil futures and agricultural commodity options, as part of wider reforms to internationalise China’s futures markets.

“China is already the biggest importer of many commodities in the world. It needs a bigger influence in the global pricing of commodities,” Christopher Fix, managing director and head of Asia Pacific for the CME Group, told the South China Morning Post.

China’s clout in the setting of commodity prices has already been growing, especially in copper and iron ore, Fix said.

“Asia is expressing its views” in the setting of commodities prices, he said.