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The situation when the cash or spot price of a metal is greater than its forward price. A backwardation occurs when a tight nearby situation exists in a metal. The size of the backwardation is determined by differences between supply and demand factors on the nearby positions compared with the same factors on the forward position. There is no official limit to the backwardation. The backwardation is also referred to as the "back." Wolff

Source: Dictionary of Mining, Mineral, and Related Terms

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