Q3 2021 Metals Update

  • 13 Jul 2021
  • By CME Group

Record month for COMEX Aluminum futures

  • Average daily volume during May reached 700 contracts, a 51% increase compared to April 2021.  
  • ​​​​Volume also exceeded 1,000 contracts on 15 separate days during Q2 with open interest at nearly 400 contracts as of June 30 — up 153% compared to the start of Q2.

Source: CME Group.

  • With the order book the strongest ever recorded, offering deep on-screen liquidity throughout the trading day, now is a great time to look at Aluminum futures.

Learn more about ALI

READ: Five reasons interest in COMEX Aluminum is growing

COMEX Copper options volume at an all-time high

  • Copper has become a strong indicator of global economic recovery as infrastructure spending and consumption rises. The marketplace is now expressing views through options more frequently, and the trading of options spreads has been on the rise. 
  • Copper options are trading at an all-time high, and ADV year-to-date is 3400 ‒ up 38% YTD YoY. 
  • All-time record of 25K contracts traded on May 10. 
  • Open interest is over 70K contracts. 
  • As Copper is trading at an all-time high, bid/ask spreads are under one vol wide.

Source: CME Group.

Non-US Gold options volume accelerates

  • More than 20% of trading volume happens outside of US trading hours. Total volumes have grown as liquidity has improved both on-screen and in block markets.

Source: CME Group.

  • OTC and exchange cleared pricing have also become more closely linked in extended hours as COMEX liquidity has become more robust around the clock.
  • Well-functioning liquid markets around the clock have been invaluable as the market has grown to digest information in real time.

Learn more on Gold

Steel continues to march on

  • COMEX Steel futures are on pace for a sixth consecutive year of record volume.
  • US Hot-Rolled-Coil (HRC) Steel futures ADV has risen 18% YoY to 1,030 contracts YTD ($37M notional). Open interest is at a record high at over 35K contracts (over $1.2B notional).
  • European HRC Steel futures hit record volume, open interest, and participation. Average 1.8K metric tons traded per day in June, with open interest at 30K metric tons and the largest participant growth since launch.
  • By notional value traded, the global ferrous market is the world’s largest commodity market, only behind global crude oil.

Learn more about Steel

Listen again: European steel webinar

READ: Record prices further enhance adoption of HRC Steel futures

ESG Initiatives

CME Group expands responsible sourcing to Silver, Platinum, and Palladium

In May 2021, the Exchange adopted responsible sourcing guidelines for physically delivered Silver futures in collaboration with LBMA and for physically delivered Platinum futures and Palladium futures in collaboration with LPPM.

The guidance is based on industry standards set by the Organization for Economic Cooperation and
Development (OECD).

Read the SER

Cobalt continuing to grow with market demand

Six months after launch, trading in COMEX Cobalt Metals (Fastmarkets) futures has found quick adoption in the industry.

Open interest currently sits at 1,780 metric tons, as at June 30, or $42M in notional value. Based on customer demand, the contract listing has already been extended twice, and participants can now trade cobalt futures until December 2023 contract maturity.

The cobalt market is growing strongly as higher electric vehicle (EV) production volumes lift demand for the blue metal.

More on Cobalt

Lithium futures launched on May 2

Lithium Hydroxide (Fastmarkets) futures contract launched on May 2. The contract is financially settled based on the monthly arithmetic average of an assessment published by Fastmarkets each Thursday of the contract month.

The contract quickly gained traction, trading five tons on the first day of trading.

Learn more about Lithium

Listen again: Lithium webinar

Recycling demand could drive up busheling scrap price risks

Busheling scrap is the cleanest form of recyclable ferrous material. Reducing emissions by using clean scrap to produce steel is key to addressing climate change, but an inelastic supply could lead to price swings.

This creates a risk management challenge for market participants.

Read how CME Group can help you manage price risk using futures contracts.

Read the article

Never miss a trade with new block alerts

Get real-time block alerts sent to your inbox or mobile device – you’ll be notified anytime a trade occurs for the product group you selected. Filter to “My Blocks” for a new, personalized view of the products you want to follow.

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Data as of June 30, 2021, unless otherwise specified.

View the current version and an archive of the Metals Update online at: cmegroup.com/education/metals-update.html.