China, one of the world’s largest producer & consumer of commodities products, has been slow to transact in commodity based financial contracts, but the landscape is amending and change is imminent, according to Garry Jones, CEO of the London Metal Exchange (LME). The country covers over 40% of all physical consumption and production, however figures on the trading side are minimal with only around 20% transacted in the financial markets either as an OTC or listed instrument. A number of factor have affected the slow participation of Chinese traders, which is about to change with market practises in favour of a sustainable and prominent futures. The surge in activity is driven by low commodity prices, coupled with gaining access to well-governed markets. The LME has played a pivotal role in providing connectivity to the London commodity market and Chinese firms are taking advantage of LME’s cultural connection, and are the new trading-clearing members at the historic commodity trading venue. Garry Jones Mr Jones spoke about the rise in volumes, at a Bloomberg event in London today covering China’s commodity markets, he mentioned that the trading activity has risen in the pre-London open session. “We saw significant activity on the 14th … continue reading
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