LME WEEK-New Abaxx exchange to expand EV metals offering beyond nickel

Abaxx Technologies

09/10/2023 17:10

By Eric Onstad
       LONDON, Oct 9 (Reuters) - A new Singapore-based
commodities exchange, preparing to roll-out a futures contract
for nickel used in electric vehicles (EVs), also aims to add
contracts for other metals used in EV batteries, executives told
Reuters.
    The Abaxx Commodities Exchange executives reiterated they
aimed to launch the world's first futures contract for nickel
sulphate by the end of this year.
    Nickel sulphate is a form of nickel used in EV batteries, a
sector which is growing in importance.
    Futures contracts give producers, industrial consumers and
investors an easy way to trade products while also allowing
hedging of prices to help with financial planning. 
    "I think nickel will be the first step in that battery
metals space for us, not the last," said David Greely, chief
economist for the exchange.
    "We've already been approached by others saying we love what
you've done in the nickel sulphate contract. How about you look
at these other markets." 
    Chief Commercial Officer Joe Raia declined to give details
on which contracts would be next, but said it would be logical
to look at metals such as at lithium.
    The exchange, owned by Canadian-listed Abaxx Technologies
Inc  ABXX.NLB , also plans to launch futures in liquefied
natural gas (LNG) and carbon.
    Greely said prospective customers liked the structure of the
new contract that is physically-settled but does not have a
network of warehouses for delivery like dominant metals market
London Metal Exchange (LME).
    Instead, Abaxx futures contracts facilitate delivery
directly from seller to buyer.
    The existing nickel futures contracts on the LME and the
Shanghai Futures Exchange both trade in Class 1 refined nickel.
    Abaxx was still aiming to launch its exchange and first
contracts by the end of the year, but that depended on
regulatory approvals, said Dan McElduff, president of strategy
and development.
    Raia, Greely and several other Abaxx executives formerly
worked at investment bank Goldman Sachs and they recently
recruited Jeff Currie, a prominent analyst who recently retired
as Goldman's global head of commodities research. 
    Also involved with the company as an investor is Robert
Friedland, a mining investor who made billions of dollars after
discovering some of the world's biggest nickel and copper
deposits. 

 (Reporting by Eric Onstad
Editing by Mark Potter)
 ((eric.onstad@thomsonreuters.com; +44 20 7542 7093; Twitter https://twitter.com/reutersEricO;
 Reuters Messaging: eric.onstad.thomsonreuters.com@reuters.net))