MOSCOW - Russia's Nornickel has listed the world's first exchange traded commodity (ETC) physically backed by carbon-neutral nickel, the producer said on Monday, as it looks to attract more investors to metals needed for the global energy transition.
The world's largest producer of palladium and high-grade nickel, Nornickel has launched several physically-backed ETCs this year via its Global Palladium Fund, offering investors exposure to metals without owning them.
The new ETC is listed on the Vienna Stock Exchange and aims to attract institutional investors focused on the global efforts to reduce emissions, Nornickel said on Monday.
It will be underpinned by carbon-neutral nickel which the miner started producing in July. Nornickel plans to produce up to 10 000 t of this product in 2021.
"Investors can take advantage of low-cost access to nickel which plays a fundamental role in the transition to clean energy in the knowledge it has been mined and produced responsibly," Alexander Stoyanov, chief executive at the Global Palladium Fund, said in the statement.
Prices for nickel, used for production of batteries for electric vehicles, are up 18% this year as the global transition to greener energy supports demand.
The ETC's carbon credit is generated by Nornickel's carbon saving in 2019–2020 via an upgrade of its hydro power plant, repair of power equipment, reduction of heat losses in buildings and other efforts.
Auditors EY verified the volume of Nornickel’s emissions and Sphera, an environmental and sustainability consultant, confirmed the methodology behind the emission calculations, the company said.
ETC's total expense ratio is estimated at 0.75% with the minimum investment at $100 000.