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International derivatives marketplace CME Group Inc (NASDAQ:CME) today announces the addition of Aluminium European Premium Duty-Paid (Metal Bulletin) futures contracts, in a move to further boost its base metals offering.
The new contracts are set to begin trading on March 21, 2016. They will be available for trading on CME Globex, for submission for clearing through CME ClearPort, and will be listed with and subject to the rules and regulations of COMEX.
Aluminium European Premium Duty-Paid (Metal Bulletin) futures will be 25 metric tons in size and will be financially settled against the Metal Bulletin assessment of aluminium spot price transactions in Europe.
The new product joins an existing lineup, which includes Aluminium Japan Premium (Platts) futures, Aluminium European Premium Duty-Unpaid (Metal Bulletin) futures, Aluminum MW U.S. Transaction Premium Platts futures and physically delivered Aluminum futures.
Young-Jin Chang, CME Group Executive Director of Metals Products, says,
“This new contract complements our existing regional aluminium premium futures contracts, and will enable a broader and more diverse set of our European customers to hedge their exposure to the aluminium premium. Our new Aluminium European Premium Duty-Paid contract responds to commercial customer demands for a solution to manage their premium price risk and builds on the successful launch of our Aluminium European Premium Duty-Unpaid European premium futures last year.”
Raju Daswani, Metal Bulletin Managing Director, says,
“Volatile aluminium premiums have had a major impact on the market over recent years, and the previous lack of a good hedging mechanism has resulted in huge financial uncertainties for buyers. With the success of CME Group’s duty-unpaid aluminium premium contract, settled against Metal Bulletin’s industry benchmark, it is imperative that the same hedging opportunity now be provided to the duty-paid market, which is a liquid trading arena that is highly relevant to major European manufacturers.”
The existing Aluminium European Premium futures contract has traded 150,050 metric tons and hit a record of 5,127 contracts open interest on March 1, 2016 since it started trading in September 2015. Since their launch in December 2015, Aluminum Japan Premium futures contracts have traded 45,075 metric tons and reached a peak of 1,608 open interest on March 1, 2016.
You can view the full announcement from CME Group by clicking here.