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CSRC Approves DCE Iron Ore Options

Mining News - Published on Thu, 28 Nov 2019

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China Securities Regulatory Commission has given green light to Dalian Commodity Exchange fore trading of new commodity options including iron ore. This means that China might have a chance to challenge some of the traditional options trading markets such as Singapore, where the bulk of global iron ore options are traded. The policy also gives enterprises access to more risk-hedging tools in their commodity trading.

Mr Liu Wensheng, deputy director of the ferrous metal department at First Futures, told "Most of China's iron ore options were traded over the counter in the past. But because of extreme volatility in iron ore prices this year, enterprises need officially launched derivatives apart from the traditional futures contracts as risk-hedging methods.”

The DCE stressed in one of its recent reports that launching iron ore options would push the building of an iron ore international pricing center in China. According to the DCE statement, more than 170 offshore clients from 15 countries and regions have traded DCE's iron ore futures since those contracts were opened to offshore investors in May 2018.

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Posted By : Rabi Wangkhem on Thu, 28 Nov 2019
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