China smelter group agrees to lower Q1 copper charges
The charges tend to fall when ore supply declines and rise when more concentrate is available.
The owner of Saudi Arabia’s stock market has acquired a 32.6% stake in the Dubai Mercantile Exchange as it seeks to diversify its revenue and gain access to oil, metals and agricultural trading.
Saudi Tadawul Group bought the holding in the DME, as the Dubai exchange is known, for 107 million riyals ($28.5 million), according to a statement on Thursday, making it the joint largest shareholder along with US-based CME Group.
As part of the agreement, the DME will be renamed the Gulf Mercantile Exchange and will expand in energy, metals and agricultural products. The Tadawul also has the option to take majority control of the exchange after four years.
The deal won’t involve any Saudi oil trading on the exchange. Instead, the platform will remain home to the Oman Crude oil futures contract.
The investment comes as Saudi Arabia spends billions of dollars to become a hub for the production and processing of metals and minerals. Its sovereign wealth fund is the majority owner of Tadawul, and a key investor in the kingdom’s broader commodities strategy.
Saudi Arabia last week said it has $2.5 trillion of unexploited metals and minerals deposits, almost double a previous estimate of $1.3 trillion.
Under Crown prince Mohammed bin Salman, the kingdom also wants to invest globally to secure access to critical minerals such as copper, nickel, lithium and iron ore, used in equipment from electric vehicle batteries to solar panels. These materials will be processed by new refineries and smelters to feed a wider industrial network across the country.
Dubai’s neighbor, Abu Dhabi, hosts one of the region’s biggest oil-trading exchanges.
The DME investment will help “unlock new growth opportunities, leveraging our proximity to key financial and production hubs to bridge demand from east and west,” Tadawul Group chief executive officer Khalid Al Hussan said in the statement.
(By Matthew Martin)
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