* Shanghai bourse debuts new copper options
* Almost 18,000 lots traded in debut day, equal to 90,000 t of metal
* Bourse may open copper futures to foreign investors
* Part of China's push to develop derivatives trading (Updating turnover in 4th and 5th paragraphs)
By Josephine Mason
BEIJING, Sept 21 (Reuters) - China's top state copper companies threw their weight behind Shanghai's first copper options on Friday, with early turnover trouncing its New York rival and raising a big challenge to the 141-year-old London bourse in the $270 billion global market.
The initial burst of activity demonstrates strong interest among Chinese investors as the country aims to capitalise on its role as the world's top metals producer and consumer to develop its domestic derivatives industry.
The copper options, which follow the launch of sugar and soymeal options last year, come as the Shanghai Futures Exchange (ShFE) also considers opening its flagship copper futures to foreign investors.
Almost 18,000 options contracts changed hands in their debut session, equivalent to almost 90,000 tonnes of metal worth 4.44 billion yuan ($649 million), according to Reuters calculations based on exchange data.
It was not clear if the first-day enthusiasm would last, but that was more than six times the average daily copper options volume in August at CME Group and some 70 percent of the London Metal Exchange's turnover, Reuters calculations show.
Malcolm Freeman, director of Kingdom Futures, said the contract had enjoyed a positive start.
"With current market volatility, it looks set to become a very popular contract," he wrote in a note.
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.
The ShFE contract could lure Chinese copper firms who currently trade in London and New York, as well as new participants unable to stump up the foreign currency required as collateral for trading on those exchanges. The ShFE copper contract is denominated in yuan.
Trading in Shanghai is only open to local participants or foreign entities with a China-based trading unit, such as Swiss commodity trading house Trafigura.
ShFE said in a statement that 120 members and investors took part in the opening auction, including top producers Tongling Nonferrous Metals and Jiangxi Copper, commodities trader COFCO, China Merchants Securities and Shenzhen-based brokerage Jinrui Futures.
Trafigura was also an early participant, buying a handful of bullish call options for delivery in January, a source said. He declined to be identified as he is not authorised to speak to the media.
The exchange has lined up almost a dozen market makers from copper producers to brokers to ensure liquidity for the new contract.
Over the past decade, the Shanghai bourse, which was set up in 1999 has carved out a bigger share of the global copper futures market, challenging the LME's near dominance as China's economy boomed and retail investors flocked to commodities futures trading.
($1 = 6.8358 Chinese yuan renminbi)
Reporting by Josephine Mason in BEIJING; additional reporting by Tom Daly in SHANGHAI and Fang Cheng in BEIJING; editing by Richard Pullin