The 19th China (Shenzhen) International Futures Conference, themed "Harnessing the Functions of the Futures Market to Serve China's Modernization", was held in Shenzhen on December 7, 2024, hosted by the China Futures Association. Vice Chairman Chen Huaping of the China Securities Regulatory Commission and Vice Mayor Luo Huanghao of Shenzhen attended the main forum and delivered speeches. Special guest Zhang Ming, Deputy Director of the Institute of Finance at the Chinese Academy of Social Sciences, gave a keynote speech on site, while Scott O'Malia, CEO of the International Swaps and Derivatives Association (ISDA) and former Commissioner of the U.S. Commodity Futures Trading Commission (CFTC), delivered a keynote speech online.

Vice Chairman Chen Huaping of the China Securities Regulatory Commission (CSRC) stated in his speech that the Central Committee of the Communist Party of China and the State Council attach great importance to the futures market. In September this year, the General Office of the State Council forwarded the opinions of the CSRC and six other departments, making comprehensive and specific arrangements for the strong regulation, risk prevention and promotion of development of the futures market, which is of milestone significance. Under the strong leadership of the Central Committee of the Communist Party of China and the State Council, all relevant parties have made joint efforts to effectively promote the stable operation and high-quality development of the futures market. First, the variety system has been continuously improved. Currently, 143 futures and options varieties have been listed, covering major fields of the national economy such as agriculture, metals, energy, chemicals, building materials, shipping, and finance. Second, the market operation has been stable and progressive. From January to November 2024, the cumulative trading volume of the futures market reached 561.99 trillion yuan, an increase of 7.98% year-on-year. As of the end of November, the proportion of institutional clients' positions reached 64.93%, and the average daily equity proportion of special institutional clients reached 50%. Industrial and institutional clients have become important forces determining the quality and efficiency of the futures market operation. Third, the price influence has significantly increased. The prices of most futures varieties have become the benchmark for domestic trade pricing. Open varieties such as crude oil, rubber, PTA, and iron ore have price influence in the Asia-Pacific region and are widely used as pricing references for cross-border trade. Fourth, the effectiveness of serving the real economy is obvious. The majority of market entities refer to futures prices to reasonably arrange production and operation and use futures and options tools to achieve hedging. Fifth, the risk prevention and control system is generally complete. China's futures market has established a risk prevention and control system that conforms to general laws and has Chinese characteristics. Relevant experiences have been incorporated into the newly revised "Principles for the Supervision of Commodity Derivatives Markets" by the International Organization of Securities Commissions.

Vice Chairman Chen Huaping pointed out that on the journey of advancing Chinese-style modernization, the futures market has broad development space and great potential. The Third Plenary Session of the 20th Central Committee of the Communist Party of China has mapped out a grand blueprint for further comprehensive deepening of reforms and promoting Chinese-style modernization. The high-quality development of the futures market can make unique contributions to comprehensively advancing the cause of building a strong country and national rejuvenation with Chinese-style modernization. First, it can help build a unified national market. The high-quality development of the futures market can contribute to the construction of a unified national market at multiple levels such as prices, circulation, and standards. The futures market, by fully leveraging its price discovery function, can establish a centralized, efficient, and comprehensive price system at the national level. By further improving the layout of futures delivery warehouses and optimizing the management rules for standard warehouse receipts, futures exchanges can enhance the circulation efficiency of bulk commodities across the country. The quality standards of futures have the characteristics of authority and uniformity. On this basis, continuously optimizing and improving futures standards in line with the direction of industrial transformation and upgrading can help enhance industrial standards and promote transformation and upgrading. Second, it can help enhance the resilience of the industrial and supply chains. The high-quality development of the futures market can play an active role in maintaining the security of industrial and supply chains in terms of enterprise operations, industrial operations, and ecological construction. The further enrichment of futures and options tools and the deepening of industrial services by futures exchanges and futures operating institutions will help various enterprises better hedge risks, lock in profits, and stabilize production. Basis trading can help upstream and downstream enterprises negotiate prices reasonably and efficiently, reduce trade frictions, and ensure the smooth circulation of industrial and supply chains. The futures market provides a public and fair trading platform for more industries, which is conducive to creating a healthier industrial chain ecosystem. Third, it can help write the five major articles of finance well. Writing the five major articles of finance well, namely, science and technology finance, green finance, inclusive finance, elderly care finance, and digital finance, is an important focus for financial services to support the high-quality development of the real economy. The layout of futures exchange varieties is expanding into the fields of new energy and new materials. Futures operating institutions can provide personalized risk management services for the specific needs of technology-based enterprises. The futures market will further enrich green futures varieties and launch carbon emission rights futures at an appropriate time. The "insurance + futures" model will further optimize its business model and reach the grassroots level. Futures operating institutions will further extend their services to thousands of factories and enterprises. The financial futures market will further expand its product range and improve operational efficiency to help stabilize pension returns. The digital transformation of various operating entities in the futures market will enhance the quality and efficiency of futures and derivatives services. The digital technologies cultivated by the futures market will spill over to the spot market, helping to optimize and upgrade the commodity spot market.

Vice Chairman Chen Huaping emphasized that the "Opinions" issued by the General Office of the State Council have clearly defined the short-term, medium-term and long-term development goals for the futures market. Achieving the first-stage goals for the next five years is the current key task. First, we need to strengthen regulatory systems and safeguard the risk bottom line. We should further improve the regulatory system for the futures market, incorporate all financial activities of various market participants into the regulatory scope, and establish a comprehensive and strict regulatory orientation. We should also further enhance risk prevention and control in the futures market, coordinate the risks in the futures and spot markets, both on- and off-exchange, and at home and abroad, enrich the risk response and disposal toolkit, and make full use of various risk reserve resources. Second, we need to improve the product layout and fully leverage the market's functions. Futures exchanges should continuously promote the expansion, quality improvement and efficiency enhancement of the futures market. The expansion should focus on key areas, serving the construction of an agricultural power and a manufacturing power, as well as green and low-carbon development. Quality improvement should involve in-depth research in the market frontlines and strengthen product research and development. Efficiency enhancement should involve improving trading systems, perfecting systems such as combined margin and market makers, and promoting the continuous activity of products. Third, we need to optimize the market structure and improve the market ecology. In terms of cultivating industrial clients, we should deeply study their actual demands and continuously improve the institutional environment for enterprises to conduct hedging. In terms of guiding institutional clients, we should encourage them to provide high-quality liquidity to the futures market and effectively meet the hedging demands of industrial clients. In terms of protecting small and medium-sized traders, we should incorporate trader education into the process of conducting various businesses. Fourth, we need to strengthen industry institutions and enhance service capabilities. We should accurately define functional positioning. Futures companies should focus on their expertise in futures and derivatives to conduct business. Asset management business should develop distinctive features, and risk management business should strive to solve the difficulties of real enterprises. We should also transform business concepts, improve products and services in a targeted manner, establish a differentiated business concept, and avoid low-level competition. We should promote excellent culture. Futures companies and practitioners should resolutely adhere to the "five dos and five don'ts" and establish a good industry image. Fifth, we need to expand opening up and deepen international cooperation. We will continue to increase open products, steadily include eligible futures and options products in specific varieties, and expand the range of commodity futures and options trading for qualified foreign investors in batches and in an orderly manner. We will continue to expand cross-border cooperation, support domestic and foreign exchanges in conducting settlement price authorization, cross-border commodity ETF and other businesses, and allow foreign exchanges to launch more financial products linked to domestic futures prices. We will also actively promote regulatory exchanges, study and draw on advanced experiences from mature overseas markets, and accelerate the construction of a Chinese-characteristic futures regulatory system that is compatible with an open environment.

Professor Zhang Ming, deputy director of the Institute of Finance at the Chinese Academy of Social Sciences, delivered a keynote speech on "Macroeconomic Situation and Outlook". Professor Zhang Ming believes that in recent years, the co-resonance of global economic policy uncertainty and geopolitical risks has intensified. He analyzed in detail the monetary and trade policies of major economies and interpreted several important domestic macroeconomic indicators, believing that domestic macroeconomic policies are expected to continue to ease.

Scott O'Malia, the CEO of the International Swaps and Derivatives Association (ISDA) and a former member of the U.S. Commodity Futures Trading Commission (CFTC), delivered a keynote speech on "The Development and Regulation of the Global Derivatives Market." In his speech, Mr. O'Malia positively evaluated the significant importance of the promulgation of the "Futures and Derivatives Law of the People's Republic of China," believing that it can significantly reduce credit risks when enterprises default. He introduced various measures formulated by ISDA to maintain the stable operation of the derivatives market and discussed key issues on the global regulatory agenda.

Leaders from seven domestic and foreign exchanges conducted in-depth analysis and discussion on topics such as building world-class futures exchanges, enhancing the influence of commodity prices, and better serving global industries. Looking forward to 2025, in the complex international political and economic environment, futures exchanges will be guided by the spirit of the 20th National Congress of the Communist Party of China and under the leadership of the China Securities Regulatory Commission, firmly grasping the main line of "strong supervision, risk prevention, and promoting high-quality development", further playing the role of market hub and leading role, effectively exerting the functions of the futures market, and making greater contributions to serving the overall situation of economic and social development. The heads of six futures companies shared their views on how to implement the "Opinions" and promote the high-quality development of futures companies.

This conference has invited nearly 800 representatives from various sectors, including central and state organs, the China Securities Regulatory Commission (CSRC) and its dispatched institutions and affiliated units, local governments, relevant industry associations, financial institutions such as securities, futures and funds, industrial chain entities, and financial media.

The co-organizers of the conference, including the Shanghai Stock Exchange, Shenzhen Stock Exchange, Beijing Stock Exchange, Shanghai Futures Exchange, Zhengzhou Commodity Exchange, Dalian Commodity Exchange, China Financial Futures Exchange, Guangzhou Futures Exchange, China Futures Market Monitoring Center, China Commodity Index Co., Ltd., and China Minsheng Bank, as well as the hosts Nanhua Futures, Yong'an Futures, Xinhu Futures, CITIC Futures, and Shenzhen Futures Association, have meticulously planned and jointly organized this event. In addition to the main forum, the conference also features four sub-forums: "Futures Analyst Forum", "Futures Plus: Empowering High-Quality Industrial Development Forum", "Technology Empowering Futures Industry Development Forum", and "Financial Derivatives Risk Management Forum". The topics covered in these forums encompass a wide range of important issues currently of concern in the context of the strong regulation, risk prevention, and high-quality development of China's futures market.