Date：March 15, 2015
Source: Futures Daily

On March 13, the price department of National Development and Reform Commission (NDRC) signed the memorandums of cooperation (MOCs) respectively with Shanghai Futures Exchange (SHFE), Zhengzhou Commodity Exchange (ZCE) and Dalian Commodity Exchange (DCE), in a bid to promote the information sharing and complementary advantages of both sides, closely track the price changes of relevant commodity futures and timely study and put forward policies and suggestions on control and regulation.
At the signing ceremony, Ye Chunhe, Vice President of SHFE, delivered a speech on behalf of the three commodity exchanges.
Ye said that prices, as an important lever for allocation of social resources, play an important role in the construction of the system of socialist market economy. Price discovery is one of the basic functions of the futures market, and the open, transparent, efficient and market-oriented pricing mechanism of the futures market provides a reasonable price reference system for the market participants. To make the futures prices benchmark prices, the market must have certain conditions in place, such as the fully developed spot markets, the smoothly connected forward markets and efficiently running futures markets, and only in this way can the multi-level commodity pricing system be formed with the futures prices as the benchmarks and the spot prices and forward prices as supplements. In recent years, with the growing influence of China's commodity futures market, more and more companies have referred to the domestic futures prices in pricing trade contracts. For example, more than 80% of the domestic spot trade of non-ferrous metals has been settled with the SHFE futures prices of non-ferrous metals as the benchmarks.
He said that after 20 years of exploration and development, China's futures market has made certain achievements in terms of market size, innovation in products, and laws, regulations and systems, etc., having been more and more closely linked with China's economic development and financial reform. At present, there are a total of 46 listed futures products in China, covering all sectors such as agricultural products, non-ferrous metals, ferrous metals, precious metals, energy, chemicals, and finance.
Ye also pointed out that the power in pricing the bulk commodities is highly related to the core interests of the state. Currently in the world, the international trade prices of the bulk commodities such as agricultural products, non-ferrous metals and petroleum have been decided by foreign futures markets. It is objective for China, as the world's second largest economy, to have the demand for speeding up the opening up, improve the influence of the domestic futures markets in pricing in the international trade, and establish the power of commodity pricing fitting China’s economic development and matching the real economy influence of “China factors”, so as to grasp the initiative for the distribution of benefits in the international economic and trade pattern as well as achieve the transformation from a major economy to an economic power.