CHINA will allow foreign investors to trade in domestic iron ore futures markets starting May 4, the country’s securities regulator said in a news briefing Friday. The Dalian Commodity Exchange is currently the only Chinese exchange offering iron ore futures contracts. Iron ore futures are the second Chinese commodity derivatives market that has been opened to overseas investors after the crude oil futures contract offered by the Shanghai Futures Exchange that started trading last month. China is the world’s biggest consumer of iron ore, the raw material for manufacturing steel. The country is also biggest steel producer globally. In February, the Dalian Commodity Exchange issued draft rules to guide foreign investors for participating in the market. The Dalian Exchange did not immediately respond to requests for a comment on the CSRC announcement when contacted. Right now, Chinese buyers don’t always get the best prices for iron ore, partly because its locals-only Dalian Commodity Exchange doesn’t have pricing power outside the country. The securities regulator plans to accelerate opening of the country’s futures market, such as iron ore trading, granting access to more foreign investors in an effort to deepen the nation’s capital markets, the CSRC’s futures supervision department said in an article in China Securities Journal on Sept. 28 last year. (SD-Agencies) |