Industry Metal Derivatives - Nigeria

Nigeria

Highlights

The nominal value in the Industry Metal Derivatives market is projected to reach US$121.10bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 2.75% resulting in a projected total amount of US$138.70bn by 2029.
The average price per contract in the Industry Metal Derivatives market amounts to US$0.36 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached China (US$2.83tn in 2024).
In the Industry Metal Derivatives market, the number of contracts is expected to amount to 380.20k by 2029.

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Industry Metal Derivatives market in Nigeria is experiencing a significant growth trajectory in recent times.

Customer preferences: Investors in Nigeria are increasingly turning to metal derivatives as a way to diversify their portfolios and hedge against market volatility. The appeal of these derivatives lies in their potential for high returns and the opportunity to participate in the global commodities market without having to physically own the assets.

Trends in the market: One notable trend in the Nigerian metal derivatives market is the growing interest in gold and silver contracts. As traditional safe-haven assets, gold and silver derivatives are becoming popular among investors looking to protect their wealth in times of economic uncertainty. The demand for these precious metal derivatives is also being driven by their use as inflation hedges and store of value.

Local special circumstances: Nigeria's metal derivatives market is also influenced by local factors such as government policies, regulatory environment, and infrastructure development. The country's economic stability and the development of its financial markets play a crucial role in shaping the growth of the metal derivatives market. Additionally, the increasing participation of local institutional investors and the presence of international financial institutions are contributing to the expansion of the market.

Underlying macroeconomic factors: The growth of the metal derivatives market in Nigeria is closely tied to broader macroeconomic factors such as global metal prices, foreign exchange rates, and geopolitical events. Fluctuations in commodity prices, especially for metals like gold, silver, and copper, impact the trading activity and demand for metal derivatives in the country. Moreover, the stability of the Nigerian economy, inflation rates, and government policies all influence investor sentiment and participation in the metal derivatives market.

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.