The London Metal Exchange has announced it will launch two minor metals contracts in the second half of 2009 for molybdenum and cobalt.
The London Metal Exchange has announced it will launch two minor metals contracts in the second half of 2009 for molybdenum and cobalt. The contracts have been approved for launch by the LME board and will now be finalised in conjunction with market participants.
Once launched, the exchange says, the contracts will offer all the benefits of an exchange-traded product, allowing participants access to a transparently derived price and the ability to manage price risk. Molybdenum and cobalt are derived from copper and nickel respectively, non-ferrous metals already traded on the LME.
“The announcement heralds another new area, minor metals, in which the exchange can provide transparent pricing and price risk management to market participants,” says chief executive Martin Abbott.
“Minor metals have been discussed by the exchange for some time, and fit with our core products as they are extracted with them. The volatility in these markets in recent times has highlighted the need for an exchange-traded product, which the LME is best placed to provide.”
The LME is the world’s largest non-ferrous metals market with a volume of almost 93 million lots in 2007, an increase of 7 per cent from the previous year and equivalent to USD9.5trn in monetary terms.
Trading at the exchange in non-ferrous metals, steel and plastics takes place through open-outcry trading on the ‘Ring’, through an inter-office telephone market and through the LME Select electronic trading platform.
