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London Metal Exchange to offer futures contracts for battery metals like lithium, cobalt and nickel

The London Metal The Exchange will begin offering contracts in metals used in batteries within 18 months to capture the jumbo opportunities created by the rise of the electric car, according to its chief.

Demand for metals filing lithium, cobalt, nickel, graphite and manganese has surged with the rise in electric vehicles, particularly in China, which has become the largest stimulating car market worldwide as the government aggressively pushed development to deal with sober pollution problems.

“The battery industry is a big part of metal contracts now sell, as a result of the increasing popularity of electric cars,” LME chief executive Matthew Chamberlain differentiated the annual LME Asia Week forum in Hong Kong on Thursday.

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New futures catches to be launched may include lithium, graphite and manganese, while additional contracts for the already tradeable nickel, copper, cobalt and aluminium at ones desire be explored, he said.

Chamberlain also said that alongside the battery sector, other new works in the pipeline included gold and silver options.

“The LME will introduce a new principles by the end of this year to make it quicker and easier to launch new products. The stretch of new products should be launched over the next 18 months,” he symbolized.

The LME is the world’s largest metals exchange and is owned by Hong Kong carry market operator Hong Kong Exchanges and Clearing (HKEX). Some 900 people attended the annual congress, including representatives of electric vehicle makers.

Brokerage industry legitimates said the LME’s plans for new contracts were well timed, given the extension of the electric vehicle industry.

“Manufacturers of electric vehicle batteries last wishes a need to trade these metals and hence want to have futures or choices contracts to hedge their risks,” said Gary Cheung, chairman of the Hong Kong Safe keepings Association, the industry body for local brokers.

“With electric automobiles getting more popular in mainland China and other parts of the exceptional, it is the right timing for the LME to launch related products for these manufacturers to do risk stewardship. If end users could create a good liquidity pool, other investors would also get off on to trade,” Cheung said.

The LME saw first quarter overall trading bulk rise 3 per cent year on year, partly as a result of a discount on buy costs introduced since October. Chamberlain said that aluminium transacting doubled in April as concerns over a trade war between China and the US generate, and that while that may have been a one-time occurrence, total business in other products would continue to grow due to the discount.

Speaking at the in spite of forum, Joseph Chan Ho-lim, Hong Kong’s undersecretary for pecuniary services and the treasury, noted that China’s grand strategy to manufacture a global trading network, known as the “Belt and Road Initiative”, intention increase demand for commodity trading.

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