"We believe this new contract, which will complement CME Group's existing physically delivered benchmark COMEX copper futures, will become a reference price for copper traded in or delivered to China," Young-Jin Chang, executive director of metals products and global head of metals at CME Group, said in a statement.
Year-on-year trading volume in CME's copper futures contract is up 31 percent, while that of the LME is down 7 percent, Chang told CNBC.
On Thursday, open interest for copper was greatest on the Shanghai Futures Exchange, at 125,994, followed by CME's COMEX at 96,023 and 84,215 on the LME, according to Thomson Reuters data. Copper has surged more than 22 percent this year, to a three-year high, as traders have bet on greater demand from China.
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In a sense, China already has business control of LME. In 2012, Hong Kong's stock exchange and futures market operator HKEX acquired LME for 1.4 billion pounds ($2.2 billion at the time).
LME's parent HKEX said trading volume comparisons between base metals exchanges "can be misleading," since LME volumes come mostly from the physical market, while mainland Chinese volume comes mostly from retail traders and Chinese hedge funds.
Already in July, Citi analyst Tracy Xian Liao noted in a report that "Activity in Chinese commodity futures markets has exploded over the past three years, and should keep expanding over the next few years, with Beijing set on China playing a larger role in global price discovery."
Liao noted that total open interest in local Chinese commodities futures exchanges nearly doubled from around $155 billion in 2014 to $265 billion at the end of this past June.
Some are trying to tap into the Shanghai market in order to tap into the arbitrage, or price difference, opportunities in all three markets. London-based Arion Investment Management, which launched a Raptor Commodities Fund in late October, is working to gain access to the Shanghai Futures Exchange, which will likely occur sometime in 2018, according to founder Gerardo Tarricone, formerly of Morgan Stanley.