China should set up a coal and coke futures exchange in Taiyuan, capital city of the coal-rich Shanxi Province, as soon as possible, a lawmaker said Friday.

Launching coal and coke futures would allow investors to use arbitrage to preserve value of coal and coke in the production, transportation, and sales process, and would push China's coal industry to develop in a sustainable way, said Zheng Jianguo, head of Shanxi's provincial department of finance.

According to Zheng, a deputy to the National People's Congress, no other countries in the world have so far launched coke futures, but "it should be easy to form standardized contracts for the staple raw material for its active trade and frequent price fluctuations," he said.

He said Shanxi Province has "incomparable" advantages in setting up a futures exchange for coal and coke, as the province's coke production accounts for 40 percent of the country's total, and 18 percent of the world's total.

(Xinhua News Agency March 13, 2010)