ABN AMRO Clearing gains access to China’s commodity futures market

Serving the interests of our clients

Due to high trade volumes in China’s commodities market and its growing role as a price-setter, many of our existing internationally-based clients are eager to participate, particularly proprietary trading firms and corporate hedger firms. International investors, free to settle trades in USD or RMB and move capital in and out of China with greater flexibility, are looking forward to the country’s further market liberalisation with the expectation of wider access to more commodities products.

ABN AMRO Clearing clients with trading accounts from our Singapore office are now able to book internationalised futures products such as Crude Oil futures on the INE and Iron Ore futures with DCE. Using the same trading account, clients that trade in other correlated products across international markets enjoy further margin offsets from our risk model. In serving the interests of our clients, we expect to steadily expand our China service offering in internationalised products across its exchanges.

"As one of the top clearers in every time zone globally, we ultimately want to play an active role in the financial markets’ ecosystem," said ABN AMRO Clearing’s Asia Pacific CEO Barry Parker. "With our entry into China’s fast growing commodity market, we hope to contribute to the accessibility of China’s markets as well as provide greater transparency and liquidity for our clients."

Participating in the world’s leading commodity market

ABN AMRO Clearing is initiating our China coverage with two of the country’s biggest commodity futures. China’s most internationalised product, INE’s Crude Oil futures, has overseas institutional investors making up one-third of institutional trading volume and almost double of its institutional open interest. With a daily trading volume of 141,985 lots in 2019, it is the third largest Crude Oil futures after WTI and Brent. Additionally, China, as the world’s biggest consumer of iron ore and top producer of steel, already boasts the most traded Iron Ore futures globally in 2019 with more than 200 international investors trading 29.6 billion metric tons on the DCE.

As the world’s largest consumer of commodities, China’s exchanges grew rapidly to become the biggest commodity futures market globally in 2008. A decade on, China opened its first commodity futures contract to foreign investors in March 2018. Despite the global economic uncertainty this year, China’s commodity futures market continued to expand in the first half of 2020 with record trading volumes and greater participation from international investors.