TOKYO -- The Shanghai Futures Exchange saw more turnover of commodity futures than any other exchange worldwide in 2013, a ranking from the Tokyo Commodity Exchange shows.
The Shanghai exchange returned to first place after occupying the No. 4 spot in 2012, logging an 80% year-on-year surge in transactions that brought the total to 642 million contracts. The second spot was claimed by the New York Mercantile Exchange, and IntercontinentalExchange's ICE futures U.S. came in third.
The Shanghai Futures Exchange's surge in volume owes in part to newly listed products and active precious metals trading. It started evening trading of silver and gold last July. Individual investors exploiting price differences with markets in such places as London and New York through arbitrage trading helped push up the volume.
Trading volume for silver rose eightfold. And an uptick in gold imports to China increased the demand for futures to hedge against price fluctuation risks.
Because participation in the Shanghai Futures Exchange is, in principle, limited to domestic investors due to government restrictions on capital transactions, the proportion of trade by individuals investors is high. With the real estate and stock markets sagging, retail investors have apparently moved more money into commodities.
Some analysts see trading volume tending to be relatively high because of the prevalence of small-lot deals.
U.S. exchanges have enjoyed steady trading as well. ICE futures U.S. saw volume jump ninefold, thanks in part to higher turnover of energy-related futures. The New York Mercantile Exchange, meanwhile, ticked up 7%.
The Tokyo Commodity Exchange, which took over agricultural products after the Tokyo Grain Exchange disbanded last year, saw trading volume increase but still fell from 12th place to 13th.
Overall, commodity futures trading in Japan has been in a slump, sliding 14% on the year in fiscal 2013, and individual investors continue to put their money elsewhere.
The Tokyo Commodity Exchange compiled the ranking based on data from the U.S.-based Futures Industry Association.