Comex gold stocks surge as price premium sucks metal to New York

April 7, 2020

LONDON (Apr 7) - Stocks of gold held in vaults in New York registered with CME Group’s Comex exchange have jumped to 15.9 million ounces, the most since at least 2002, as a large price premium sucks bullion to the city.

Gold futures on Comex leaped above London spot prices two weeks ago after coronavirus control measures shut down air travel and several major precious metals refineries.

Traders feared it would be impossible to ship gold from London, a major storage centre, to settle contract obligations in New York, where much more gold trades than is stored.

Higher prices create an incentive to move metal, and the stockpile in Comex-registered vaults has surged to 15.9 million ounces — worth some $26 billion — from 11 million ounces at the end of last week and less than 9 million ounces two weeks ago, CME data showed.

The most-traded gold contract on Comex remained around $50 — or 3% — higher than London spot gold on Tuesday, suggesting that despite the partial reopening of three large refineries in Switzerland, worries over supply remain.

That contract has a June delivery date, and there are currently 357,369 contracts active representing 35.7 million ounces of gold.

Investors on Comex typically want exposure to gold prices and do not request delivery of metal, instead rolling their positions to future months.

Of around 200,000 contracts for April delivery active on March 23, when prices on Comex began to rise sharply above spot gold, around 25,000 equivalent to 2.5 million ounces have been taken to delivery, according to CME data.


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