{"id":6427,"date":"2024-12-13T05:37:56","date_gmt":"2024-12-13T05:37:56","guid":{"rendered":"https:\/\/www.alcircle.com\/blog\/?p=6427"},"modified":"2024-12-13T05:38:14","modified_gmt":"2024-12-13T05:38:14","slug":"hedging-with-jorge-episode16-navigating-contango","status":"publish","type":"post","link":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango","title":{"rendered":"Hedging with Jorge #Episode16: Navigating Contango"},"content":{"rendered":"\n<p>In our last discussion, we explored how a contango situation benefits aluminium producers. To recap, contango occurs when the market price for a future date is higher than the nearby or current price. For producers, this is fantastic. They can sell into the futures market at a higher price.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<div class=\"youtube-embed\" data-video_id=\"jUhA2WCRnlk\"><iframe loading=\"lazy\" title=\"Hedging with Jorge #Episode16: Navigating Contango\" width=\"696\" height=\"392\" src=\"https:\/\/www.youtube.com\/embed\/jUhA2WCRnlk?feature=oembed&#038;enablejsapi=1\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/div>\n<\/div><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<p>But what does contango mean for consumers? Let\u2019s dive in.<\/p>\n\n\n\n<p>For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility. In the aluminium market, contango values typically range from $25 to $50 per metric ton for contracts within three months. Beyond this period, the curve can flatten or decrease, meaning the proportional increase seen in the first three months may not extend further.<\/p>\n\n\n\n<p>So, what\u2019s the strategy for consumers? Think long-term. Hedging for longer durations can help manage costs more effectively, especially when the curve flattens. If you\u2019re an aluminium consumer\u2014say, a foil producer or frame manufacturer\u2014selling at fixed prices means you cannot afford exposure to fluctuating aluminium prices. Hedging through the futures market becomes essential.<\/p>\n\n\n\n<p>While contango might seem costly\u2014easily surpassing broker commissions\u2014it is a necessary expense. Consider this: a typical contango cost of $25\u2013$50 far outweighs broker fees of $2\u2013$3. However, failing to hedge exposes you to unpredictable market fluctuations, which could have severe financial implications.<\/p>\n\n\n\n<p>In short, hedging protects consumers from volatility, turning a necessary cost into long-term stability.<\/p>\n\n\n\n<p>See you next time as we continue to navigate the dynamics of the aluminium market.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In our last discussion, we explored how a contango situation benefits aluminium producers. To recap, contango occurs when the market price for a future date is higher than the nearby or current price. For producers, this is fantastic. They can sell into the futures market at a higher price. But what does contango mean for [&hellip;]<\/p>\n","protected":false},"author":89,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-6427","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-open-forum-for-aluminum-community-blog"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Hedging with Jorge #Episode16: Navigating Contango<\/title>\n<meta name=\"description\" content=\"For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Hedging with Jorge #Episode16: Navigating Contango\" \/>\n<meta property=\"og:description\" content=\"For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango\" \/>\n<meta property=\"og:site_name\" content=\"AL Circle Blog\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AlCircle\" \/>\n<meta property=\"article:published_time\" content=\"2024-12-13T05:37:56+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-12-13T05:38:14+00:00\" \/>\n<meta name=\"author\" content=\"Jorge Eduardo Dyszel\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@alcircle\" \/>\n<meta name=\"twitter:site\" content=\"@alcircle\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Jorge Eduardo Dyszel\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango\"},\"author\":{\"name\":\"Jorge Eduardo Dyszel\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#\\\/schema\\\/person\\\/64371a8562aa8589375f4f9a8c08a9f6\"},\"headline\":\"Hedging with Jorge #Episode16: Navigating Contango\",\"datePublished\":\"2024-12-13T05:37:56+00:00\",\"dateModified\":\"2024-12-13T05:38:14+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango\"},\"wordCount\":268,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#organization\"},\"articleSection\":[\"AL Circle\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango\",\"url\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango\",\"name\":\"Hedging with Jorge #Episode16: Navigating Contango\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#website\"},\"datePublished\":\"2024-12-13T05:37:56+00:00\",\"dateModified\":\"2024-12-13T05:38:14+00:00\",\"description\":\"For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility.\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/hedging-with-jorge-episode16-navigating-contango#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Hedging with Jorge #Episode16: Navigating Contango\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#website\",\"url\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/\",\"name\":\"AL Circle Blog\",\"description\":\"Aluminium Industry Trend &amp; Analysis, Technology Review, Event Rundown and Much More \u2026\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#organization\",\"name\":\"AL Circle\",\"url\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/wp-content\\\/uploads\\\/2026\\\/03\\\/ALC-logo-black.png\",\"contentUrl\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/wp-content\\\/uploads\\\/2026\\\/03\\\/ALC-logo-black.png\",\"width\":1200,\"height\":600,\"caption\":\"AL Circle\"},\"image\":{\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/AlCircle\",\"https:\\\/\\\/x.com\\\/alcircle\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/#\\\/schema\\\/person\\\/64371a8562aa8589375f4f9a8c08a9f6\",\"name\":\"Jorge Eduardo Dyszel\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/wp-content\\\/uploads\\\/2026\\\/02\\\/89.thumbnail-1.webp\",\"url\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/wp-content\\\/uploads\\\/2026\\\/02\\\/89.thumbnail-1.webp\",\"contentUrl\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/wp-content\\\/uploads\\\/2026\\\/02\\\/89.thumbnail-1.webp\",\"caption\":\"Jorge Eduardo Dyszel\"},\"description\":\"Jorge Eduardo Dyszel\u2019s career, spanning over four decades, showcases his expertise as one of the world's foremost consultants in risk management, specialising in base metals and the London Metal Exchange (LME). From his early days in Buenos Aires, where he earned his CPA, to working with leading firms such as Aluar Aluminio Argentino and Glencore, Jorge\u2019s contributions in hedging strategies and risk management have been instrumental in shaping industries across 15 countries on three continents.\",\"sameAs\":[\"https:\\\/\\\/www.linkedin.com\\\/in\\\/jorge-eduardo-dyszel-9391342b\\\/\"],\"url\":\"https:\\\/\\\/www.alcircle.com\\\/blog\\\/author\\\/jorge\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Hedging with Jorge #Episode16: Navigating Contango","description":"For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango","og_locale":"en_US","og_type":"article","og_title":"Hedging with Jorge #Episode16: Navigating Contango","og_description":"For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility.","og_url":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango","og_site_name":"AL Circle Blog","article_publisher":"https:\/\/www.facebook.com\/AlCircle","article_published_time":"2024-12-13T05:37:56+00:00","article_modified_time":"2024-12-13T05:38:14+00:00","author":"Jorge Eduardo Dyszel","twitter_card":"summary_large_image","twitter_creator":"@alcircle","twitter_site":"@alcircle","twitter_misc":{"Written by":"Jorge Eduardo Dyszel","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango#article","isPartOf":{"@id":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango"},"author":{"name":"Jorge Eduardo Dyszel","@id":"https:\/\/www.alcircle.com\/blog\/#\/schema\/person\/64371a8562aa8589375f4f9a8c08a9f6"},"headline":"Hedging with Jorge #Episode16: Navigating Contango","datePublished":"2024-12-13T05:37:56+00:00","dateModified":"2024-12-13T05:38:14+00:00","mainEntityOfPage":{"@id":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango"},"wordCount":268,"commentCount":0,"publisher":{"@id":"https:\/\/www.alcircle.com\/blog\/#organization"},"articleSection":["AL Circle"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango","url":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango","name":"Hedging with Jorge #Episode16: Navigating Contango","isPartOf":{"@id":"https:\/\/www.alcircle.com\/blog\/#website"},"datePublished":"2024-12-13T05:37:56+00:00","dateModified":"2024-12-13T05:38:14+00:00","description":"For consumers, contango represents a cost. When hedging, they must pay the higher futures price, which is essentially the price of protection against market volatility.","breadcrumb":{"@id":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.alcircle.com\/blog\/hedging-with-jorge-episode16-navigating-contango#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.alcircle.com\/blog\/"},{"@type":"ListItem","position":2,"name":"Hedging with Jorge #Episode16: Navigating Contango"}]},{"@type":"WebSite","@id":"https:\/\/www.alcircle.com\/blog\/#website","url":"https:\/\/www.alcircle.com\/blog\/","name":"AL Circle Blog","description":"Aluminium Industry Trend &amp; Analysis, Technology Review, Event Rundown and Much More \u2026","publisher":{"@id":"https:\/\/www.alcircle.com\/blog\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.alcircle.com\/blog\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.alcircle.com\/blog\/#organization","name":"AL Circle","url":"https:\/\/www.alcircle.com\/blog\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.alcircle.com\/blog\/#\/schema\/logo\/image\/","url":"https:\/\/www.alcircle.com\/blog\/wp-content\/uploads\/2026\/03\/ALC-logo-black.png","contentUrl":"https:\/\/www.alcircle.com\/blog\/wp-content\/uploads\/2026\/03\/ALC-logo-black.png","width":1200,"height":600,"caption":"AL Circle"},"image":{"@id":"https:\/\/www.alcircle.com\/blog\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/AlCircle","https:\/\/x.com\/alcircle"]},{"@type":"Person","@id":"https:\/\/www.alcircle.com\/blog\/#\/schema\/person\/64371a8562aa8589375f4f9a8c08a9f6","name":"Jorge Eduardo Dyszel","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.alcircle.com\/blog\/wp-content\/uploads\/2026\/02\/89.thumbnail-1.webp","url":"https:\/\/www.alcircle.com\/blog\/wp-content\/uploads\/2026\/02\/89.thumbnail-1.webp","contentUrl":"https:\/\/www.alcircle.com\/blog\/wp-content\/uploads\/2026\/02\/89.thumbnail-1.webp","caption":"Jorge Eduardo Dyszel"},"description":"Jorge Eduardo Dyszel\u2019s career, spanning over four decades, showcases his expertise as one of the world's foremost consultants in risk management, specialising in base metals and the London Metal Exchange (LME). From his early days in Buenos Aires, where he earned his CPA, to working with leading firms such as Aluar Aluminio Argentino and Glencore, Jorge\u2019s contributions in hedging strategies and risk management have been instrumental in shaping industries across 15 countries on three continents.","sameAs":["https:\/\/www.linkedin.com\/in\/jorge-eduardo-dyszel-9391342b\/"],"url":"https:\/\/www.alcircle.com\/blog\/author\/jorge"}]}},"_links":{"self":[{"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/posts\/6427","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/users\/89"}],"replies":[{"embeddable":true,"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/comments?post=6427"}],"version-history":[{"count":3,"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/posts\/6427\/revisions"}],"predecessor-version":[{"id":6432,"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/posts\/6427\/revisions\/6432"}],"wp:attachment":[{"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/media?parent=6427"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/categories?post=6427"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.alcircle.com\/blog\/wp-json\/wp\/v2\/tags?post=6427"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}