Post by Sapphire Capital on Jul 12, 2008 22:50:33 GMT 4
LME Nickel Futures & Traded Options
As an alloying metal, the uses of nickel are extraordinarily diverse. Its high melting point and resistance to corrosion have provided a wide scope for the metal’s development. Early in the twentieth century, it was discovered that by combining nickel with steel, even in small quantities, the durability of the steel increased significantly with regards to corrosion resistance and strength. This partnership has endured and the steel industry is now the single largest consumer of nickel today.
With the introduction of nickel trading to the LME in 1979, the Exchange’s coverage of all major non-ferrous metals was complete. The LME is acknowledged as the principal pricing mechanism for nickel producers and consumers worldwide and is the only exchange in the world to provide facilities for the industry to hedge sales and purchases.
LME Nickel Futures Contract Specification
Contract Primary Nickel of 99.80% minimum purity with chemical analysis conforming to the current ASTM: Designation B39 - 79 (reapproved 2004)
Lot size 6 tonnes (with a tolerance of +/- 2%)
Form 1. Full Plate
2. Cut Cathodes
3. Pellets
4. Briquettes
Weight 1. Bundles shall not exceed 1.6 tonnes in weight
2. - 4. Packed in sound steel drums with an even net weight (+/-2% more or less) of minimum 150kgs and maximum 500kgs
Delivery dates Daily for 3 months forward and then every Wednesday for the next 3 months and the every third Wednesday of the month for the next 21 months out to 27 months forward.
Quotation US dollars per tonne
Minimum Price Movement Ring - Outright $5.00, Carries $0.01
LME Select - Outright $1.00, Carries $0.01
Inter-office - Outright/Carries $0.01
Clearable currencies US dollar: Japanese yen; sterling: euro
LME Nickel Options Contract Specification
Delivery dates Monthly from the first month out to 27 months
Value date The third Wednesday of the prompt month
Exercise date The first Wednesday of the prompt month
Premium quotation US dollars per tonne
*Strike price $25 gradations for strikes from US$25 to US$3975
$50 gradations for strikes form US$4000 to US$7950
$100 gradations for all strikes over $US8000
*Strike price gradations and tick size for premiums available in all clearable currencies.
LME Nickel Traded Average Price Options Contract Specification
Contract date The business day on which the contract is traded
Contract period Calendar months up to 15, 27 or 63 months forward (in line with the underlying futures contracts). The inclusive period between the first business day and the last business day of the traded month.
Option type Calls & puts based on the monthly average settlement price (MASP)
Currency & strike price US dollars 1 gradations
Premium tick size 0.01 USD (one cent)
Premium payment Next business day after contract is traded
Settlement date Settlement is two business days after exercise
The futures trades settle as per LME rules & regulations
Access the special contract rules for metals using the LME online rulebook.
The LME has long acknowledged the global nature of the industry and has developed an international network of warehouses in Europe, Asia and around the world, which include all the major producing companies and traded average price options (TAPOs) were made available in October 2000.
As a risk management mechanism, the LME nickel contract offers transparency with the security of clearing, stability through regulation, and a 24 hour global trading structure that are the hallmarks of the world’s leading non-ferrous metal exchange.
LME contracts may only be offered of sold to United States foreign futures and options customers by firms registered with the Commodity Futures Trading Commission (CFTC), or firms who are permitted to solicit and accept money from foreign futures and options customers for trading on the LME pursuant to CFTC Rule 30.10.
As an alloying metal, the uses of nickel are extraordinarily diverse. Its high melting point and resistance to corrosion have provided a wide scope for the metal’s development. Early in the twentieth century, it was discovered that by combining nickel with steel, even in small quantities, the durability of the steel increased significantly with regards to corrosion resistance and strength. This partnership has endured and the steel industry is now the single largest consumer of nickel today.
With the introduction of nickel trading to the LME in 1979, the Exchange’s coverage of all major non-ferrous metals was complete. The LME is acknowledged as the principal pricing mechanism for nickel producers and consumers worldwide and is the only exchange in the world to provide facilities for the industry to hedge sales and purchases.
LME Nickel Futures Contract Specification
Contract Primary Nickel of 99.80% minimum purity with chemical analysis conforming to the current ASTM: Designation B39 - 79 (reapproved 2004)
Lot size 6 tonnes (with a tolerance of +/- 2%)
Form 1. Full Plate
2. Cut Cathodes
3. Pellets
4. Briquettes
Weight 1. Bundles shall not exceed 1.6 tonnes in weight
2. - 4. Packed in sound steel drums with an even net weight (+/-2% more or less) of minimum 150kgs and maximum 500kgs
Delivery dates Daily for 3 months forward and then every Wednesday for the next 3 months and the every third Wednesday of the month for the next 21 months out to 27 months forward.
Quotation US dollars per tonne
Minimum Price Movement Ring - Outright $5.00, Carries $0.01
LME Select - Outright $1.00, Carries $0.01
Inter-office - Outright/Carries $0.01
Clearable currencies US dollar: Japanese yen; sterling: euro
LME Nickel Options Contract Specification
Delivery dates Monthly from the first month out to 27 months
Value date The third Wednesday of the prompt month
Exercise date The first Wednesday of the prompt month
Premium quotation US dollars per tonne
*Strike price $25 gradations for strikes from US$25 to US$3975
$50 gradations for strikes form US$4000 to US$7950
$100 gradations for all strikes over $US8000
*Strike price gradations and tick size for premiums available in all clearable currencies.
LME Nickel Traded Average Price Options Contract Specification
Contract date The business day on which the contract is traded
Contract period Calendar months up to 15, 27 or 63 months forward (in line with the underlying futures contracts). The inclusive period between the first business day and the last business day of the traded month.
Option type Calls & puts based on the monthly average settlement price (MASP)
Currency & strike price US dollars 1 gradations
Premium tick size 0.01 USD (one cent)
Premium payment Next business day after contract is traded
Settlement date Settlement is two business days after exercise
The futures trades settle as per LME rules & regulations
Access the special contract rules for metals using the LME online rulebook.
The LME has long acknowledged the global nature of the industry and has developed an international network of warehouses in Europe, Asia and around the world, which include all the major producing companies and traded average price options (TAPOs) were made available in October 2000.
As a risk management mechanism, the LME nickel contract offers transparency with the security of clearing, stability through regulation, and a 24 hour global trading structure that are the hallmarks of the world’s leading non-ferrous metal exchange.
LME contracts may only be offered of sold to United States foreign futures and options customers by firms registered with the Commodity Futures Trading Commission (CFTC), or firms who are permitted to solicit and accept money from foreign futures and options customers for trading on the LME pursuant to CFTC Rule 30.10.