Commodities - Luxembourg

Luxembourg

The nominal value in the Commodities market is projected to reach US$103.70bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 4.46% resulting in a projected total amount of US$129.00bn by 2029.
The average price per contract in the Commodities market amounts to US$0.20 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (US$53,690.00bn in 2024).
In the Commodities market, the number of contracts is expected to amount to 561.00k by 2029.

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Currency

Analyst Opinion

The Commodities market in Luxembourg has been experiencing a significant growth in recent years.

Customer preferences: Traders and investors in Luxembourg are increasingly showing interest in commodities as a way to diversify their investment portfolios and hedge against market volatility. The ease of access to global markets and the potential for high returns are key drivers of this preference.

Trends in the market: One noticeable trend in the Luxembourg Commodities market is the growing demand for commodities linked to renewable energy sources. As the world shifts towards sustainable practices, there is a rising interest in commodities such as carbon credits and green energy derivatives. This trend aligns with global efforts to combat climate change and promotes environmentally friendly investments.

Local special circumstances: Luxembourg's position as a global financial hub plays a significant role in the development of its Commodities market. The country's favorable regulatory environment and well-established financial infrastructure attract international investors looking to participate in the commodities market. Additionally, the presence of commodity trading firms and specialized financial institutions further contributes to the market's growth and sophistication.

Underlying macroeconomic factors: The stability of Luxembourg's economy and its strong regulatory framework create a conducive environment for the Commodities market to thrive. The country's strategic location in Europe and its status as a leading center for fund administration and investment management also attract market participants looking to capitalize on the opportunities in the commodities sector. Moreover, Luxembourg's reputation as a reliable and transparent financial jurisdiction enhances investor confidence and fosters growth in the commodities market.

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.