China will add products such as crude oil futures and white sugar and soybean meal options to meet market demand for commodity trading, a senior official from China's security regulator said on Saturday according to a statement posted on the China Securities Regulatory Commission (CSRC) website. China also plans to add iron ore and natural rubber to futures markets before gradually expanding to other products, in a push for further internationalisation and to attract more overseas investors, vice chairman Fang Xinghai said at a conference in Shenzhen.
The regulator will support futures exchanges to set up delivery warehouses and offices overseas, and push for improved tax policies to normalise bonded futures delivery, he said. Fang also said speculative activity in China's commodity futures markets this year would not push up prices in the physical market. While prices of some commodity futures have surged due to short-term supply and demand imbalances, exchange rate volatility, and some speculative activity, physical markets were not affected as future prices had been lower than physical spot rates for most of the year, he said. Physical commodity prices would only be influenced by supply and demand and monetary policy, which were "out of investors' hands", he said.
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