SHANGHAI, Nov. 7 (SMM) – Shanghai Clearing House (SCH) plans to launch Free-trade-zone Copper-premium Swap based on Yangshan copper premiums, SCH’s Finance Director Chen Guang announced at a meeting focusing on shipping and commodity business co-organized by SCH and Shanghai Metals Market (SMM) November 5.

The swap contract will be priced in Chinese yuan and traded in a lot size of 5 tonnes. The settlement price of the contract will be worked out based on the Yangshan copper premium which was launched by SMM and the Administration of Shanghai Bonded Zone in March 2013 and is now generally recognized by players in copper market.

Minimum price fluctuation of the swap should be 0.01 yuan per tonne and the trading hours are set at 10: 30-18: 00 every trading day.

Only companies holding free trade account for the FTZ can trade in the swap.

This will be the first commodity derivative clearing service in the China (Shanghai) Pilot Free Trade Zone.

The SCH launched its first iron ore and thermal coal swap contracts in August in an effort to gain influence over the benchmark pricing of key commodities, and hopes to introduce the copper-premium swap this year.

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