China's Shanghai Futures Exchange opened its nickel futures and options contracts to overseas traders and qualified foreign investors on Tuesday.
The move allows three new types of entities to participate in nickel futures and options trading directly: overseas special participants, overseas intermediary institutions, and overseas clients.
"The opening to foreign investors will further optimize the market structure, enhance market depth and liquidity, provide efficient price risk management tools for global nickel industry chain enterprises, and help the stable operation of both industry and supply chains," said Chen Ye, head of the Commodities Futures Department I of Shanghai Futures Exchange.
Nickel is a key material in stainless steel, electric vehicle batteries, and aerospace manufacturing. As the world's largest consumer and importer of nickel, China has built an integrated nickel industrial chain, forming significant advantages in production, trade, and consumption, and laying a solid foundation for its participation in global pricing.
"The internationalization of nickel futures and options recently launched is not only an important measure for China's futures market to open to the outside world, but also marks that China's nickel industry has entered a new stage of deep integration into the global pricing system. On the one hand, China's opening of its nickel futures and options contracts to foreign investors enriches market participants; on the other hand, it will enhance market liquidity, promote benign interaction between domestic and foreign prices, and facilitate the formation of a more globally representative 'China price,'" said Wang Jian, vice chairman of the China Nonferrous Metals Industry Association.
Since crude oil futures contract opened to overseas investors as the first commodity futures contract in 2018, China's futures market has been steadily opened to the outside world.
At present, 38 commodity futures have been approved for opening to overseas investors in China's futures market, which has formed an system covering energy, metals, chemicals, agricultural products and other fields.
China's Shanghai nickel futures open to global investors
