Global Trade
September 2, 2025
LME contangoes: Why they may or may not matter
Written by Greg Wittbecker
Anyone who follows the metal media can’t fail to notice the market’s fixation with the LME contango or backwardation that may be in effect at the time. These are the so-called “spreads” that prevail between the LME cash price and the LME 3-month price.
Presently, the high-grade aluminum contract is in a $6 per metric ton ($/t) backwardation, which means the cash price is trading at a $6/t premium to 3-month settlement. The values for the other months inside the forward 3-month period (as shown in the table below) are either in backwardation or narrow contango as well:
