In debut, China's state copper firms, Trafigura line up to trade ShFE options

BEIJING/SHANGHAI (Reuters) - Swiss trading house Trafigura and China's top copper producers Tongling Nonferrous Metals and Jiangxi Copper were among the first to trade copper options at their debut on Friday, as the Shanghai Futures Exchange challenges New York and London rivals.

The Swiss group, which has a China-based trading unit, bought a handful of bullish call options for delivery in January, the first active month, at a strike price of 50,000 yuan ($7,314), a source said. He declined to be identified as he is not authorised to speak to the media.

Almost 5,000 contracts, equivalent to just over 24,000 tonnes of copper worth 1.2 billion yuan ($176 million), had changed hands in the first 40 minutes of trading, with the majority in contracts expiring in January.

In a statement, ShFE said 120 members and investors took part in the opening auction, including commodities trader COFCO, China Merchants Securities and Shenzhen-based brokerage Jinrui Futures.

The product, which follows the launch of sugar and soymeal options last year, comes as the exchange also considers opening its flagship copper futures to foreign investors, and is a major step in China's prolonged effort to develop its derivatives industry.

Options help metal consumers, producers and traders manage price exposure. A contract gives the buyer the right - but no obligation - to assume a futures position at a specified price.

($1 = 6.8358 Chinese yuan renminbi)

(Reporting by Josephine Mason in BEIJING and Tom Daly in SHANGHAI; editing by Richard Pullin)