On March 6-7, 2024, representatives from the Ministry of Industry and Trade, the Mercantile Exchange Of VietNam (MXV), and the Vietnam Maritime Corporation had a meeting with the Dalian Commodity Exchange (DCE) in China to strategize comprehensive cooperation in developing the Vietnam-China commodity trading market.

Sharing Experience in Market Management and Organization

The Dalian Commodity Exchange (DCE) was established in February 1993 and is one of the three largest commodity exchanges in China. With a long history of development and a well-organized operational system, DCE is currently among the top 10 largest commodity exchanges in the world.

This was the first time DCE had formal working sessions with agencies and units organizing and operating the commodity trading market in Vietnam, opening up potential cooperation opportunities between the Vietnamese and Chinese markets.

At the Ministry of Industry and Trade headquarters, DCE shared many important insights on policies and regulations that the Chinese government has been applying in managing and organizing the commodity trading market. Mr. Ran Hua, Chairman of DCE, said: "The legal framework is the foundation for the stable and sustainable development of the commodity trading market. With the constant market fluctuations, policies and regulations need to be adjusted quickly and timely to keep pace with global development."

The representative of the Ministry of Industry and Trade also stated that in 2024, the Ministry will coordinate with relevant agencies to draft a new decree to replace Decree 158/2006/ND-CP and Decree 51/2018/ND-CP to complete the legal framework to promote the development of the commodity trading market in Vietnam. The Chinese market shares many similarities with Vietnam, so DCE's experiences are valuable and can be studied and applied in managing and organizing the market in Vietnam.

Potential Cooperation in Multiple Fields

Regarding market operations, DCE exchanged and shared practical experiences with the Ministry of Industry and Trade and MXV in implementing activities such as transaction management, risk management, transaction clearing, and price insurance.

In China, the first contracts listed on the commodity exchanges mainly belonged to the agricultural sector. Major agricultural commodities such as wheat, corn, and soybeans have long been emphasized by the Chinese government for their strategic importance in economic development. Corn and soybean contracts of DCE continuously lead in trading volume worldwide.

At the working session, Mr. Dang Viet Hung, General Director of MXV, said: "MXV has been coordinating with relevant organizations, ministries, and agencies to establish specialized commodity exchanges for Vietnam's key products. Initially, the Rubber Exchange and the Pork Exchange will soon be launched in Ho Chi Minh City."

These products are also related to trade with the Chinese market. China is currently the largest producer of pork and the largest importer of rubber in the world. "DCE and MXV have the potential to cooperate in linking transactions, cross-listing products between the two exchanges. Chinese traders can purchase Vietnam's major physical commodity products that meet the standards and are listed by MXV on specialized exchanges," Mr. Ran Hua affirmed.

Additionally, DCE stated that it is ready to send top experts to Vietnam to share and provide knowledge and experience for the commodity trading market. DCE will also coordinate with MXV to organize international seminars with the participation of leading global experts. These seminars are opportunities to enhance the quality of human resources for Vietnam's commodity trading market, elevating Vietnam's position on the global commodity trading map.

Developing Trade and Port Logistics

On March 7, 2024, DCE, together with MXV, discussed with the Vietnam Maritime Corporation (VIMC) the plan to develop physical commodity delivery in Vietnam. Both MXV and DCE affirmed that physical commodity delivery is an indispensable part of the operational model of any commodity trading market and is a crucial task to ensure continuity in commodity trading activities.

Following positive exchanges, the three parties visited Hai Phong port. With a favorable geographical location, import activities of raw materials at Vietnamese ports have been vibrant since the early 2000s. Hai Phong port, in particular, is a large port system with 50 berths capable of receiving ships over 130,000 tons, facilitating direct shipments from Hai Phong to continents. With thorough investment and professional operations, Hai Phong port is considered to have all the favorable factors to develop the logistics service industry, aiming to become a regional and international logistics center in the future.

The cooperation between MXV, DCE, VIMC, and Hai Phong port will create a solid foundation to help the commodity trading market in Vietnam develop comprehensively. This is an essential and important factor in the country's economic and trade integration process, enhancing its position and serving as a launching pad to help Vietnam's commodity trading activities reach international levels.

Source: MXV