Do futures contracts create cobalt or molybdenum price volatility?
Futures contracts have provide effective and reliable tools with which to manage volatility. Cobalt and molybdenum are already volatile markets, but the LME contracts will help industry manage risk much better. The introduction of a futures market introduces the potential of funds and speculators to invest in the industry; their involvement does not increase fundamental volatility and may dampen cycles by taking the opposite side to industrial clients.
