Published : 2024-06-10

On June 10, 1991, China's first futures exchange, the Shenzhen Nonferrous Metals Exchange (深圳有色金屬交易所), was formally established.

Futures trading refers to the standardised trading behaviour based on contracts, colloquially referred to as "Long-Short" (買空賣空). After the founding of the People's Republic of China, futures trading was long considered illegal speculation.

In the late 1970s, after the implementation of China's Reform and Opening-up, the reform of Chinese enterprises gradually came into place, moving towards autonomous operation and assuming their own profits and losses.

A futures market that can truly reflect long-term supply and demand, and provide accurate and authoritative market and price data, thus became a pressing need.

The Shenzhen Non-ferrous Metals Exchange was established in reference to the London Metal Exchange, introducing the international futures market mechanism to China and establishing a comprehensive set of operating procedures and management systems based on this.

The Shenzhen Non-ferrous Metals Exchange allowed spot, forward, and futures trading. The exchange operated a member system, and only member units can send representatives to conduct open, fair, rational, and legal transactions.

The exchange provided places and information for spot and futures trading for representatives of member units, and performed transaction settlement business according to the laws and regulations promulgated by the government.

By 1998, the State Council of China carried out a structural adjustment of the country's futures market and decided in August of the same year to retain only the future exchanges in Shanghai, Zhengzhou, and Dalian, while revoking the remaining futures exchanges, including the Shenzhen Non-ferrous Metals Exchange.