Industry Metal Derivatives - Africa

  • Africa
  • The nominal value in the Industry Metal Derivatives market is projected to reach US$1.87tn in 2024.
  • It is expected to show an annual growth rate (CAGR 2024-2029) of 2.05% resulting in a projected total amount of US$2.07tn by 2029.
  • The average price per contract in the Industry Metal Derivatives market amounts to US$0.15 in 2024.
  • From a global comparison perspective it is shown that the highest nominal value is reached in China (US$2,835.00bn in 2024).
  • In the Industry Metal Derivatives market, the number of contracts is expected to amount to 13.43m by 2029.
 
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Analyst Opinion

The Metal Derivatives market in Africa is experiencing a notable growth trajectory, driven by various factors influencing customer preferences and market trends.

Customer preferences:
Customers in Africa are increasingly turning to metal derivatives as a way to diversify their investment portfolios and hedge against market volatility. The allure of potentially high returns from trading in metal derivatives is attracting a growing number of investors looking to capitalize on price movements in the global metal markets.

Trends in the market:
In South Africa, the largest economy on the continent, the Metal Derivatives market is witnessing significant growth. This can be attributed to the country's well-established financial infrastructure and regulatory framework, which provides a conducive environment for trading in metal derivatives. Additionally, the presence of a sophisticated investor community and access to advanced trading technologies are further fueling the expansion of the market.

Local special circumstances:
Nigeria, another key player in the African Metal Derivatives market, is experiencing a surge in demand for these financial instruments. The country's large population and expanding middle class are driving the need for alternative investment opportunities, with metal derivatives offering a way to participate in the global commodities market without the need for physical ownership of metals. Additionally, the Nigerian government's efforts to diversify the economy away from oil dependency are also contributing to the growing interest in metal derivatives as a financial asset.

Underlying macroeconomic factors:
Across Africa, the Metal Derivatives market is also influenced by broader macroeconomic factors such as currency fluctuations, geopolitical events, and global economic trends. The volatility in metal prices, driven by factors like supply and demand dynamics, trade policies, and geopolitical tensions, plays a crucial role in shaping investor sentiment and trading activity in the market. Moreover, the overall economic stability and growth prospects of individual countries in Africa impact the level of participation and interest in metal derivatives as an investment avenue.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.

Overview

  • Value Development
  • Volume
  • Analyst Opinion
  • Methodology
  • Key Market Indicators
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