(Yicai Global) Oct. 27 -- China will support the Dalian Commodity Exchange to study the feasibility of issuing crude oil futures to advance the northeastern port city's position as a global transport hub.

The National Development and Reform Commission revealed its plan for the coastal Liaoning province in a document published yesterday. The blueprint includes building a warehouse warrant registry and steadily expanding the exchange's over-the-counter business.

Northeast Asia, which includes Russia, Japan, and Mongolia, is an important region for global trade. Three of the world’s largest 10 ports in container throughput were located in Northeast Asia last year, according to a report released by the China Economic Information Service, assisted by the Baltic Exchange.

Market reaction has been prudent. China already has domestic crude oil futures, and market participation is pretty good, Liu Shunchang, energy and chemical futures analyst at Nanhua Futures, said to Yicai Global.

If the DCE wants to issue new contracts, the design should significantly differ from the existing ones, said Liu. It will take a long time to prove the feasibility of crude oil futures in Northeast Asia, the analyst added.

The idea is to bolster the local economy. China will build the Liaoning coastal belt into an important international shipping center in Northeast Asia, according to the plan. The region should become a green and efficient world-class port cluster, with the Port of Dalian at the center. It should develop a combination of railway and sea logistics to support the hinterland economy, per the document.

Setting up a warrant registry is important as it could provide strong support for the standardized development of the spot market, a futures professional said to Yicai Global. It could improve the quality of the futures market because warehouse warrants can serve as a pledge for banks to help brick-and-mortar companies vitalize their spot assets, the person added.

Editor: Emmi Laine, Xiao Yi