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One of the ‘original’ metals, copper shared an era of history with tin as a fundamental component of the Bronze Age. However, its primary properties in modern-times are its electrical conductivity and heat-transfer abilities making it invaluable for use in the building construction and electrical industries. Copper’s malleability, strength and corrosion resistant qualities also make it an excellent alloying agent for the production of intricate shapes – particularly in brass and bronze.
This alloying factor made copper one of the most important industrial metals of the 19th century and it naturally became the flagship contract of the LME when it was established in 1877. The copper industry was quick to recognise the LME as its international pricing mechanism. This role is still fundamental to the ongoing success of the LME copper contract. LME futures, traded options and traded average price options (TAPOs) contracts provide the optimum combination of physical contract and risk management mechanisms for today’s industry members, whereby sale and purchase contracts can be hedged to an advantage. Today some 94% of all copper futures trading is carried out on the LME.
LME Copper Grade A Futures Contract Specification
| Contract |
Grade A Copper |
| Lot size |
Lot size 25 tonnes (with a tolerance of +/- 2%) |
| Form |
Grade A cathodes conforming to BSEN 1978:1998 |
| Weight |
Each parcel of copper cathodes placed on warrant shall not exceed 4 tonnes |
| Delivery dates |
Daily for cash to 3 months (first prompt date two working days from cash). Then every Wednesday from 3 months to 6 months. Then every third Wednesday from 7 months out to 63 months |
| Quotation |
US dollars per tonne |
| Minimum Price Movement |
Ring - Outright $0.50, Carries $0.01
LME Select - Outright $0.25, Carries $0.01
Inter-office - Outright/Carries $0.01 |
| Clearable currencies |
US dollar; Japanese yen; sterling; euro |
LME Copper Options Contract Specification
| Delivery dates |
Monthly from the first month out to 63 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 Traded Average Price Options 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 base don the monthly average settlement price (MASP) |
| Currency & strike price |
US dollars :$1 gradations
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| Premium tick size |
0.01 USD (one cent)
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| Premium payment |
Next business day after contract is traded
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| 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.
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