September 22, 2008

The Chinese authorities have shelved the Dalian hog futures plans after domestic prices of pork dipped from a record high, according to dealers on Friday (September 19, 2008).

"We were told by the exchange the plan was put aside as the planning body was worried that futures trading may trigger volatile prices. Domestic pork prices have eased anyway," said a dealer with a futures company in Dalian.

A dealer said another reason for the suspension was due to complex requirements demanded by regulators for quarantine and transport of live pigs for physical delivery.

Regulators are cautious in approving any new contracts this year, given the ongoing global financial crisis, according to a dealer.

Officials from the Dalian Commodity Exchange said the contract was still waiting for regulatory approval.

Record pork prices last year kept China's inflation rate at a decade-high.