Frequently Asked Questions (FAQ): Zinc Futures Contract

What is the contract symbol for the Zinc futures contract?

The contract symbol is ZNC.

 

What are the benefits of this new contract to the individual?

  • Physically-delivered monthly futures contract
  • True intraday price and spread transparency across the futures curve
  • Security through centralized clearing, guaranteed counterparty credit, and segregation of customer funds through CME Clearing
  • Easily accessible electronic execution
  • Streamlined delivery process
  • Daily mark-to-market of positions

 

What are the contract specifications?

The contract size for the Zinc futures contract is 25 metric tons. The contract is priced in U.S. dollars per metric ton. The contract is listed for trading on CME Globex and via CME Direct, and for clearing through CME ClearPort. Contract will be listed 12 consecutive months. Minimum price fluctuation is $0.50 (value per tick is $12.50). Delivery locations are in the United States. For more information about the contract specifications, visit cmegroup.com/zinc.

 

Why has CME Group launched this new contract?

This contract is being launched to help address a major concern of regional zinc users as to the status of the material. Users of the ZNC contract in the Americas will be able to know with certainty of receiving duty paid zinc in one of the Exchange’s approved delivery locations. These locations currently include New Orleans, Chicago, Baltimore, and the Detroit area.

 

Who can use this contract?

The contract is most relevant to zinc market participants across the supply chain, including miners, producers, distributors, merchants, traders, end users, and banks. Physically-settled contracts are a preferred hedging tool by commercial users in the zinc industry. Investors and liquidity providers may also use this contract as arbitrage opportunities or to manage price exposure.

 

How do I trade the contract?

ZNC will be available to trade on CME Globex and via CME Direct, our free front-end trading platform for accessing CME Group markets. CME Globex operates as a Central Limit Order Book, or CLOB. ZNC will also be available for clearing on CME ClearPort for privately-negotiated trades.

 

What are CME Globex and CME Direct?

The CME Globex platform was the first, and remains among the fastest, global electronic trading systems for futures and options. Through its advanced functionality, high reliability, and global connectivity, it is now the world's premier electronic marketplace for derivatives. To learn more about CME Globex, visit www.cmegroup.com/globex.

Delivered securely across the Internet, CME Direct is a highly configurable trading front-end for CME Group markets that offers a complete suite of solutions across the trading lifecycle. To learn more about CME Direct, CME Group’s free, trading front-end, visit www.cmegroup.com/direct.

 

What is CME ClearPort?

CME ClearPort is a comprehensive set of flexible clearing services for the over-the-counter (OTC) market. Launched in 2002 to provide centralized clearing services and mitigate risk in the energy marketplace, CME ClearPort today serves as a gateway for a diverse slate of asset class transactions submitted for clearing. With OTC clearing through CME ClearPort, you can continue to negotiate your own prices privately and conduct business off-Exchange – but you gain increased security and efficiency.

To register for clearing through CME ClearPort, you must establish an account with a COMEX Clearing Member and complete the Exchange User License Agreement (EULA) available at www.cmegroup.com/clearport.

Once you have received your username and password, contact your Clearing Member Firm and request that your clearing account be added to Risk Allocation Value (RAV) Manager. For more information about clearing member firms, please visit http://www.cmegroup.com/tools-information/clearing-firms.html

 

 

 

How do I find out more about ZNC?

 

 

 

For more information about ZNC, visit www.cmegroup.com/zinc or contact:

Fred Penha
Director, Metals

Desk: +1 212 299 2353
Email: frederick.penha@cmegroup.com

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