After six years of preparation, No. 20 rubber futures finally appeared on the Shanghai Futures Exchange.

It is worth noting that this is the second domestic futures trading product to adopt "international platform, RMB pricing" after the launch of crude oil futures last year. The birth of No. 20 rubber futures represents an important step towards internationalization of China's futures market.

Perhaps many people will wonder why we should list No. 20 rubber futures when we already have a natural rubber futures variety at present. What's the difference between the two?

Complementarity with existing rubber futures

According to the previous policy issued by Shanghai Futures Exchange, No. 20 rubber futures will apply the previous listed oil futures policy, adopt the "international platform, net price trading, bonded delivery, RMB pricing" model, and fully introduce foreign participants.

As a special commodity approved by the CSRC, No. 20 rubber is the most representative product in the rubber industry worldwide. The current natural rubber futures delivery product in the SHFE is domestic all-latex and imported No. 3 rubber smoked sheet. The listed No. 20 rubber and domestic all-latex are natural rubber, but there are differences in primary raw materials, processing technology, trade mode, end-use, preferential value-added tax rate and tariff between them. They can complement each other and further promote the mature development of China's rubber futures market.

Reducing speculative arbitrage and conducive to gaining international voice

Globally, there are four natural rubber futures exchanges: Tokyo Industrial Exchange (TOCOM), Shanghai Futures Exchange (SHFE), Singapore Exchange (SGX) and Thailand Futures Exchange (TFEX). By trading volume and holding volume, Shanghai Futures Exchange deserves the title of "the most active rubber futures exchange".

Although the result is impressive, the rubber futures trading in SHFE still has some limitations for a long time. Because the market is not fully open, the delivery targets are also limited, and the domestic natural rubber futures contract has limited price guidance to the global futures and spot markets. Therefore, although China has leaped to be the number one buyer in the global rubber market, its position as a strategic buyer has not been well highlighted in the market.

After the domestic No. 20 rubber futures contract is listed, Shanghai is expected to gradually grow into the pricing center of the global No. 20 rubber futures market based on the huge domestic rubber futures market.

At the same time, the delivery variety of No. 20 rubber futures is very close to the economy. As the main downstream consumer, its listing will increase the interest of all parties in the industrial chain. In addition, No. 20 rubber futures adopts continuous monthly contracts, which greatly reduces the impact of speculative arbitrage on the price of rubber futures.