International derivatives marketplace CME Group today announced that it will launch Cobalt Hydroxide futures on October 23, pending all relevant regulatory reviews.

This is the fourth battery metals futures contract CME Group has launched in response to evolving hedging needs within the rapidly growing electric vehicle space.

Jin Chang Hennig, Managing Director and Global Head of Metals at CME Group, commented:

“CME Group is pleased to offer market participants in the global battery supply chain more hedging granularity with a cobalt hydroxide contract. As demand continues to grow, it has become more important to manage the price risk between global, standard-grade cobalt metal and the local hydroxide price delivered into China, where hydroxide is refined into battery-grade material.”

Cobalt Hydroxide futures will be financially-settled based on the Fastmarkets’ cobalt hydroxide price assessment.

Cobalt Hydroxide futures are complementary to Cobalt Metal futures, which have become the global benchmark for Cobalt prices since launching in December 2020. Trading in Cobalt Metal futures has already surpassed its total trading volume in 2022, with over 21,000 contracts traded year-to-date.

Open interest in Cobalt Metal futures has also quadrupled over the last year, growing from approximately 5,000 contracts in September of last year to 20,607 contracts, equivalent to over 20,600 metric tons, on September 5, 2023.

The new contract will be listed by and subject to the rules of COMEX under the product name Cobalt Hydroxide CIF China (Fastmarkets) futures.