SHANGHAI, Oct 11 (Reuters) - China's Dalian Commodity Exchange said on Tuesday it will cut fees warehouses charges for delays loading out iron ore from warehouses in its network following complaints from traders who are taking physical delivery.
The exchange, which operates the world's biggest iron ore futures contract, will cut the charges for contracts starting from March 2017.
Delays can occur when trucks are used to take delivery of iron ore from storage facilities, leading to distortions between the physical and the spot prices of iron ore.
There are not the same problems when shipping iron ore by water, the exchange said, without giving further details.
In a further effort to boost liquidity, the exchange is also considering adjusting the upward limit of delivery fees in and out of warehouses, it said.
The exchange did not give a comparison for delay charges, but the new fee would be 0.1 yuan a tonne per day within 19 days after the cancellation of warrants, to be raised to 0.5 yuan beyond 19 days.
While the Dalian wait times are unlikely to be as serious as those that dogged the London Metal Exchange (LME) for years, the steps the Chinese exchange is taking to ease users' concerns are similar to those taken by the LME.
Beverage can makers have complained that LME warehouse companies have been using unfair tactics to postpone delivering aluminium from storage facilities to boost profits from rent.
In some cases, wait times for aluminium were as long as two years, inflating the physical prices for the light metal and disrupting supplies. The issue drew scrutiny from U.S. and European regulators.
To placate users' concerns, curb warehouse games and restore confidence in its global market, the LME said last month it would cap rent and load-out charges across its more than 600 warehouses.
Since launching iron ore futures three years ago, the Dalian contracts have grown increasingly popular, overtaking a rival contract on the Singapore Exchange by volume.
Costs of futures trading have captured attention in recent years as competition has intensified between exchanges like CME and Shanghai Futures Exchange and turnover has dropped.
In 2015, the LME, owned by the Hong Kong Exchanges and Clearing Ltd, hiked some fees, but it reversed the increase in August after strong criticism from brokers. (Reporting by Ruby Lian and Josephine Mason; Editing by Tom Hogue)