The London Metal Exchange (LME) will launch three new cash-settled derivative contracts settled against Fastmarkets MB’s aluminium, alumina and cobalt prices, effective from March 11, 2019.

The LME will offer these hedging mechanisms settled against the following Fastmarkets MB prices:

• Cobalt standard-grade, in-warehouse, free market $ per lb in warehouse

• Alumina Index Fob Australia $ per tonne (Fastmarkets MB/CRU basket)

• Aluminium P1020A, in-warehouse Rotterdam duty-unpaid, spot low-high, $/tonne

The final settlement price for the respective contracts will be an arithmetic average of the applicable Fastmarkets MB price listed above in the expiring contract month.

“We are delighted to announce Fastmarkets MB as one of the index providers for our new cash-settled futures contracts, which is the next step in delivering our new products strategy and an important part of our commitment to deliver greater user choice,” Robin Martin, head of market development for LME Group, said.

Key market participants have endorsed the exchange’s partnership with Fastmarkets MB as a critical step in the evolution of risk management for these markets.

“This new partnership with the LME is a testament to how engrained Fastmarkets MB prices have become in the physical markets,” Jon Mulcahy, Fastmarkets price development manager for Europe, said. “These hedging tools will provide a new opportunity for market participants to better manage their exposure to price volatility across these commodity sectors.”

Fastmarkets achieved type-1 IOSCO assurance for its standard-grade cobalt price and alumina index, and type-2 IOSCO assurance for its duty-unpaid Rotterdam premium, in August last year.

To see all Fastmarkets MB’s pricing methodology and specification documents visit: