UK-based Global Commodities Holdings Ltd (GCHL) is set to introduce a physical metals platform, commencing with nickel trading next month across various delivery locations from Baltimore to Yokohama. The platform’s traded prices will serve as the foundation for nickel indices, with plans underway to develop cash-settled derivatives contracts in collaboration with Intercontinental Exchange (ICE). GCHL’s initiative stems from a need for a regulated spot platform following disruptions in nickel trading at the London Metal Exchange (LME) two years ago, prompting the exploration of a Class 1 or higher grade nickel trading venue. The platform aims to facilitate trade, establish benchmark prices reflective of industrial activity, and enhance market liquidity.
While an exact launch date for the nickel trading platform was not disclosed, GCHL envisions expanding its offerings to include metals crucial for electric vehicle battery production, such as cobalt, manganese, and graphite. Notably, GCHL’s platform will exclude high-carbon nickel from Indonesia and China, aligning with sustainability and market demand for environmentally conscious sourcing practices. Participation in the trading platform will be limited to entities engaged in physical trading activities, ensuring market integrity and operational efficiency. Leveraging its existing relationship with ICE through globalCOAL, GCHL aims to introduce an alternative market structure for nickel trading, catering to evolving supply chain dynamics and enhancing hedging capabilities for market participants.