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Members of the cobalt and molybdenum industries can benefit from managing price risk on the LME to achieve a variety of outcomes:
- As protection against price movements
- To offer long-term fixed price sales and lock in a margin
- Improve budget forecasts of costs and profits
- Turn your stock into cash or security for finance
Using the LME also offers the opportunity to:
- Access a transparent reference price for use in negotiations
- Provide additional services to customers to gain a competitive edge
- Protect physical stock against a fall in price
- Swap physical material on a location and brand basis
- Hedge physical purchases in times of production difficulty
- Access the Exchange’s delivery mechanism as a source of material in times of extreme shortage, and as a channel to sell in times of surplus
The presence of a futures market for cobalt and molybdenum offers a number of benefits to those at all stages of the supply chain. Find out how each of the participants in the supply chain can benefit:
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