SUBMISSION COVER SHEET

IMPORTANT: Check box if Confidential Treatment is requested 

Registered Entity Identifier Code (optional): 24-060

Organization: Commodity Exchange, Inc. ("COMEX")

Filing as a: DCM SEF DCO SDR 

Please note - only ONE choice allowed.

Filing Date (mm/dd/yy): 01/22/24 Filing Description: Increase of Spot Month Position 

Limit, Single Month Accountability Level and All Month Accountability Level of the 

Lithium Hydroxide CIF CJK (Fastmarkets) Futures and Average Price Option Contracts

SPECIFY FILING TYPE 

Please note only ONE choice allowed per Submission.

Organization Rules and Rule Amendments

Certification § 40.6(a)

Approval § 40.5(a)

Notification § 40.6(d)

Advance Notice of SIDCO Rule Change § 40.10(a)

SIDCO Emergency Rule Change § 40.10(h)

Rule Numbers: 

New Product Please note only ONE product per Submission.

Certification § 40.2(a) 

Certification Security Futures § 41.23(a)

Certification Swap Class § 40.2(d)

Approval § 40.3(a)

Approval Security Futures § 41.23(b)

Novel Derivative Product Notification § 40.12(a)

Swap Submission § 39.5

Product Terms and Conditions (product related Rules and Rule Amendments)

Certification § 40.6(a) 

Certification Made Available to Trade Determination § 40.6(a)

Certification Security Futures § 41.24(a)

Delisting (No Open Interest) § 40.6(a) 

Approval § 40.5(a)

Approval Made Available to Trade Determination § 40.5(a)

Approval Security Futures § 41.24(c)

Approval Amendments to enumerated agricultural products § 40.4(a), § 40.5(a)

“Non-Material Agricultural Rule Change” § 40.4(b)(5)

Notification § 40.6(d)

Official Name(s) of Product(s) Affected: See filing.

Rule Numbers: See filing.
20 S Wacker Dr Chicago, IL 60606 T 312 466 7478 tim.elliott@cmegroup.com cmegroup.com

1

Timothy Elliott

Managing Director and Chief Regulatory Counsel

Legal Department

January 22, 2024

VIA ELECTRONIC PORTAL

Mr. Christopher J. Kirkpatrick

Office of the Secretariat

Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, DC 20581

Re: CFTC Regulation 40.6(a) Certification. Increase of Spot Month Position Limit, Single 

Month Accountability Level and All Month Accountability Level of the Lithium 

Hydroxide CIF CJK (Fastmarkets) Futures and Average Price Option Contracts.

COMEX Submission No. 24-060

Dear Mr. Kirkpatrick:

Commodity Exchange, Inc. (“COMEX” or “Exchange”) is certifying to the Commodity Futures Trading

Commission (“CFTC” or “Commission”) an increase of the spot month position limit, single month accountability 

level and all month accountability level of the Lithium Hydroxide CIF CJK (Fastmarkets) Futures and the Lithium 

Hydroxide CIF CJK Average Price Option contracts (the “Contracts”) effective on February 6, 2024 and 

commencing with the March 2024 contract month and beyond as detailed in the table below.

(additions underscored; deletions struck through)

The Position Limit, Position Accountability and Reportable Level Table (the “Table”) located in the Chapter 

5 of the COMEX Rulebook is being amended to reflect the changes in the spot month limit, single month 

accountability level and all month accountability level for the Contracts. Exhibit A provides amendments to 

the Table effective on February 26, 2024, and Exhibit B provides amendments to the Table effective on 

March 1, 2024, the date that March 2024 becomes the spot contract month (collectively, the “Rule 

Amendments”). Both Exhibit A and Exhibit B are provided under separate cover in blackline format. Exhibit 

C below provides the Exchange’s updated cash market overview and analysis of deliverable supply in 

connection with the Contract.

Contract Title Rulebook 

Chapter

CME 

Globex/CME 

ClearPort 

Commodity 

Code

Spot Month 

Position Limit (in 

contracts)

Single Month 

Accountabilit

y Level (in 

contracts)

All Month 

Accountability Level (in 

contracts)

Lithium Hydroxide CIF CJK 

(Fastmarkets) Futures

646 LTH 400 

1,000

800

1,500

1,600

1,500

Lithium Hydroxide CIF CJK 

(Fastmarkets) Average Price Option

700 LHO 400 (aggregate into LTH 

1:1 on a delta equivalent 

value)

1,000 (aggregate into 

LTH 1:1 on a delta 

equivalent value)

800

1,500

1,600

1,500
20 S Wacker Dr Chicago, IL 60606 T 312 466 7478 tim.elliott@cmegroup.com cmegroup.com

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The Exchange reviewed the designated contract market core principles (“Core Principles”) as set forth in 

the Commodity Exchange Act (“Act” or “CEA”) and identified that the Rule Amendments may have some 

bearing on the following Core Principles:

• Contracts Not Readily Susceptible to Manipulation: Due to the liquidity and robustness in 

the underlying cash markets, the Contracts are not readily susceptible to manipulation.

• Position Limitations or Accountability: The speculative position limits for the Contracts as 

demonstrated in this submission are consistent with the Commission’s guidance.

• Availability of General Information: The information contained herein will be disseminated to 

the marketplace via a Market Surveillance Notice (“MSN”). The MSN will also be posted on the 

CME Group website. In addition, the Exchange will continue to publish information on the 

contract specifications on its website, together with daily trading volume, open interest, and 

price information.

Pursuant to Section 5c(c) of the Act and CFTC Regulations 40.6(a), the Exchange hereby certifies that the 

Rule Amendments comply with the Act, including regulations under the Act. There were no substantive 

opposing views to the proposal.

The Exchange certifies that this submission has been concurrently posted on the CME Group website at 

http://www.cmegroup.com/market-regulation/rule-filings.html. 

Should you have any questions concerning the above, please contact the undersigned at (312) 466-7478

or via e-mail at CMEGSubmissionInquiry@cmegroup.com. 

Sincerely,

/s/ Timothy Elliott

Managing Director and Chief Regulatory Counsel 

Attachments: Exhibit A: Position Limits, Position Accountability and Reportable Level Table in Chapter

5 of the COMEX Rulebook (effective February 6, 2024) (attached under 

separate cover) 

Exhibit B: Position Limits, Position Accountability and Reportable Level Table in Chapter

5 of the COMEX Rulebook (effective March 1, 2024) (attached under separate 

cover)

Exhibit C: Cash Market Overview and Analysis of Deliverable Supply
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Exhibit A

COMEX Rulebook

Chapter 5

(“Trading Qualifications and Practices”) 

Position Limits, Position Accountability and Reportable Level Table 

(attached under separate cover)

[effective February 6, 2024]

Exhibit B

COMEX Rulebook

Chapter 5

(“Trading Qualifications and Practices”) 

Position Limits, Position Accountability and Reportable Level Table 

(attached under separate cover)

[effective March 1, 2024]
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Exhibit C

Cash Market Overview and Analysis of Deliverable Supply

In its cash market and deliverable supply analysis, the Exchange has incorporated data from a range of sources as 

described below.

Fastmarkets (FM) is a leading global provider of price information for metals, agriculture and forestry products. FM’s 

assessment methodologies for the futures contracts are available on its website1(under product code MB-LI-0033 for 

lithium). CME Group Inc. (parent company of COMEX) is a party to license agreements with Fastmarkets to utilize its 

pricing data for final settlement of the contract.

The United States Geological Survey (USGS) is a scientific public agency in the United States. It is tasked with 

studying the landscape of the United States, its natural resources, and the natural hazards that threaten it.

The UN Comtrade Database (Comtrade) provides free access to detailed global trade data. UN Comtrade is a data 

repository of official trade statistics and relevant analytical tables. It contains annual trade statistics starting from 1962 

and monthly trade statistics since 2010.

Final settlement of the Lithium Hydroxide CIF CJK (Fastmarkets) Futures underlying lithium futures contract is based 

on the monthly average of all price assessments for “Lithium hydroxide monohydrate 56.5% LiOH.H2O min, battery 

grade, spot price cif China, Japan & Korea, $/kg” price assessment published by Fastmarkets (FM). The methodology 

refers to battery grade lithium hydroxide monohydrate delivered CIF in China, Japan or South Korea. The quantity 

required for assessment inclusion is 5 metric tonnes minimum. The denomination is $/kg. The assessment is published 

daily.

1

https://www.fastmarkets.com/methodology/metals/lithium

https://www.fastmarkets.com/methodology/metals/cobalt
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CASH MARKET OVERVIEW - LITHIUM

Lithium is a metal that is widely used in industrial applications, notably in battery manufacturing. Lithium mining comes 

in two main forms: the metal can be produced from spodumene (lithium-containing rock) or brine. After extraction, 

lithium raw materials are refined into lithium carbonate or lithium hydroxide. According to the USGS, end-user markets 

for refined lithium were batteries (80%); ceramics and glass (7%); lubricating greases (4%); continuous casting mold 

flux powders (2%); air treatment (1%); medical (1%); and other uses (5%)2. The global lithium industry is concentrated 

in Asia, which accounts for most of the global refining and battery manufacturing capacity. Major producing countries 

include Australia, Chile and China (Table 1). As a key material for lithium-ion batteries used in electric vehicles (EVs), 

market analysts expect that the global lithium industry will grow significantly over the coming decade(s) – Fastmarkets 

stated that global lithium production must quadruple from 2020 to 2030 in order to meet growing demand.

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Table 1 – Global Lithium Production (source: USGS4)

Metric tons contained lithium 2020 2021 2022 (estimate)

United States Withheld Withheld Withheld

Argentina 5,900 5,970 6,200 

Australia 39,700 55,300 61,000 

Brazil 1,420 1,700 2,200 

Canada 500 

Chile 21,500 28,300 39,000 

China 13,300 14,000 19,000 

Portugal 348 900 600 

Zimbabwe 417 710 800 

Other countries 0 0 0 

Total (rounded) 82,500 107,000 130,000 

Table 2 shows that an average of 91,605 metric tons of lithium hydroxide was imported into North Asia during the past 

three years for which data is available.

Table 2 – Lithium Hydroxide– imports into North Asia5

Imports - Metric 

tons 2020 2021 2022 Average 2020-2022

China 527 3,600 3,088 2,405

Japan 37,339 33,876 35,543 35,586

Rep. of Korea 36,189 53,745 70,907 53,614

Grand Total 74,054 91,221 109,538 91,605

Note: Japan import data for 2020 was not available and was assumed to be equal to 2019.

Lithium hydroxide is traded both in the spot and term markets. Term contracts are using fixed price or a “formula 

pricing,” meaning a floating price component that may include customs data and/or price indexation. Term contracts 

typically allow to freely re-trade contracted volume.

2 https://pubs.usgs.gov/periodicals/mcs2023/mcs2023-lithium.pdf

3 https://www.fastmarkets.com/article/3999803/lithium-supply-and-demand-to-2030

4 https://pubs.usgs.gov/periodicals/mcs2023/mcs2023-lithium.pdf

https://pubs.usgs.gov/periodicals/mcs2022/mcs2022-lithium.pdf

5 2020 data under 

https://wits.worldbank.org/trade/comtrade/en/country/ALL/year/2020/tradeflow/Imports/partner/WLD/product/282520, 2021 data 

under https://wits.worldbank.org/trade/comtrade/en/country/ALL/year/2021/tradeflow/Imports/partner/WLD/product/282520, 2022 

data under https://wits.worldbank.org/trade/comtrade/en/country/ALL/year/2022/tradeflow/Imports/partner/WLD/product/282520
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ANALYSIS OF DELIVERABLE SUPPLY

Appendix C to part 38 of the Commission’s regulations defines deliverable supply as “the quantity of the commodity 

meeting the contract’s delivery specifications that can reasonably be expected to be readily available to short traders 

and saleable by long traders at its market value in normal cash marketing channels at the derivative contract’s delivery 

points during the specified delivery period, barring abnormal movement in interstate commerce.”

The Exchange is assessing spot month position limits for the Lithium Hydroxide CIF CJK (Fastmarkets) Futures and 

Average Price Option lithium contracts based on UN Comtrade import data for lithium hydroxide into China, Japan and 

Republic of Korea. Average annual import volume into the three countries represents 91,605 MT annually for the 2020-

2022 period, equivalent to 7,634 MT per month (7,634 contracts equivalent). The Exchange proposes a spot month 

position limit of 1,000 contracts, equivalent to 13.10% of deliverable supply.