Updated: May 20, 2021
ARRACO Global Markets has recently launched a new Energy Metals Desk, whereby we will be working closely with CME Group on their Fastmarkets Cobalt project, in order to hedge Cobalt.
CME Group manages global metal risk and having released a Lithium Hydroxide future at the beginning of May 2021, it will provide customers with an additional tool for managing the price risks associated with the manufacturing of Electric Vehicles (EV).
With the prediction of renewable energy accounting for 50% of the world’s total generation by 2035, there is an essential need for Energy Metals. Cobalt, an in-demand Energy Metal, is a critical building block for the new energy economy. It is also a principal material for the manufacturing of Lithium.
Lithium is a key component in the manufacturing of batteries that power EV's, the largest growing sector. EV’s are far more technologically advanced, less expensive and a greener alternative to the conventional vehicle, giving off fewer emissions and therefore hampering the growth of the EV market.
Our Head of Desk for Energy Metals, Philip Lye said: “Overall demand for electric cars is only going to increase, with car manufacturers acting on the carbon-neutral targets pledged by governments across the world - aiming to produce greater numbers of electric vehicles available at lower prices. As the demand for energy metals grows, as does the price volatility. Companies now have no choice but to start looking at hedging against price risk on Cobalt and Lithium.”
Both Lithium and Cobalt futures will be key in supporting the demands of diversifying fuel supplies through the energy transition for sustainable development and act as alternative sources of fuel.
Get in touch with our Head of Energy Metals Desk, Philip Lye: UK Desk +44 (0) 203 034 0951