Abaxx Technologies Inc. is set to launch three regional physically deliverable lithium carbonate futures contracts on March 7, 2025. Albemarle will be the first producer to list its lithium carbonate brand, La Negra, on the exchange, Abaxx told S&P Global Commodity Insights on Feb. 13.
"The launch of Abaxx's Lithium Carbonate futures introduces physically deliverable benchmarks that reflect market conditions," Sacha Lifschitz, Director of Metals Markets at Abaxx Exchange said.
"With contracts deliverable in Singapore, Rotterdam, and Baltimore, we're aligning with global trade flows to offer effective risk management and price transparency in a rapidly evolving battery metals market."
The Guangzhou Futures Exchange in China also offers physically deliverable futures contracts for lithium carbonate but restricts participation from foreign entities.
Addressing challenges
Global battery metal prices are currently under pressure due to high inventories and weak downstream demand.
Platts, part of S&P Global Commodity Insights, assessed battery-grade lithium carbonate at $9,800/mt CIF North Asia on Feb. 13, down 27% from a year ago when it was assessed at $13,500/mt Feb. 13, 2024.
Lifschitz emphasized the cyclical nature of commodity markets: "Even though it's a depressed market and prices are low, that's exactly why you need reliable and transparent benchmarks.
"We have defined maximum impurities, brand listings, shelf-life parameters (maximum of 6 months), quality certificates, alongside a delivery process that includes original certificates of analysis," he said.
Abaxx added that they are creating forward curves and cash-settled prices which they say enables industry to financially evaluate new mining projects, secure funding, and forward hedge years of production.
"With many mining projects up in the air, financing has been an issue for miners, and now they have a risk management tool to attract investors," Lifschitz added.
Battery metal products
The Singapore-based commodities exchange is expanding its suite of battery metal products, following the launch of its nickel sulfate futures contract in Singapore on Jan. 10, 2025.
"We see lithium carbonate as the sweet spot for the lithium product group supply chain, serving as an optimal benchmark between lithium hydroxide, which typically trades at a premium, and spodumene, which trades at a discount to the benchmark we are creating," he said.
Abaxx's lithium carbonate futures contracts will be US dollar-denominated, DAP contracts representing one tonne of lithium carbonate, deliverable at ports in Singapore, Rotterdam, or Baltimore.
