The China Securities Regulatory Commission has approved the Dalian Commodities Exchange to begin trading PVC futures. In the April 15 announcement, the agency said it will soon approve DCE's PVC futures contract.

Being the world's largest producer and consumer of PVC resin, China is in urgent need of futures trading to balance the dramatic pricing fluctuations and reduce market risk, CSRC said. The agency said it values DCE's experience of trading linear low density polyethylene futures since July 2007.

DCE said it has established a trading, transaction, and delivery system, and selected recommended delivery manufacturers and grades. The exchange published for public review the PVC futures draft contract, which specifies trading content as class-1 and premium PVC resin of the SG5 grade.

The Chinese standards categorize PVC resin into 10 grades, from SG0 to SG9. Among them, SG5, which is PVC powder produced through suspension polymerization, makes up more than 70 percent of the PVC consumption in China.