In a move which has gone entirely unnoticed in the precious metals markets, but which signals gold and silver bar delivery constraints for the COMEX gold and silver futures contracts, Chicago Mercantile Exchange Group (CME), operator of the New York based COMEX, has quietly and under the radar, hugely expanded its lists of eligible refinery gold and silver bar brands that can be delivered against the massively traded flagship GC 100 (100 oz gold) and SI (5000 oz silver) contracts.
These changes, which were implemented on 27 July and which are detailed below, also look to be serving an even bigger agenda of preparing for a radical change in the delivery procedures of these two famous contracts so as to facilitate gold and silver stored in London Bullion Market Association (LBMA) vaults in London, England, to be used in settlement against the GC 100 oz and the SI 5000 oz COMEX contracts. Note that the COMEX 100 oz gold futures contract is currently deliverable as either one 100 troy ounce gold bar, or three 1 kilo gold bars, while the COMEX 5000 oz silver futures contract is currently deliverable as five 1,000 troy ounce cast silver bars (with a weight tolerance of 10% either higher or lower).
To reiterate, these changes are to the gold and silver refiner brand lists of the big boy contracts GC 100 and SI. You may recall something similar happening for a new 4GC contract when it was rushed out in late March, but that was just a trial run. This is the main event.
August 24, 2020