COMMENT: More tools for working the metal market

Metal Bulletin last week launched the world’s first index price for charge chrome delivered to China, to provide a transparent reference for producers, suppliers and traders of ferro-chrome.

Metal Bulletin last week launched the world’s first index price for charge chrome delivered to China, to provide a transparent reference for producers, suppliers and traders of ferro-chrome.

The launch of the MB China charge chrome 50% Cr index, cif Shanghai, which will be published every Friday, follows a period of consultation with market participants inside and outside China, who have expressed interest in such an index and a willingness to support it. The first price came out at 96 cents per lb, cif Shanghai, incidentally.

Full details of the specification and methodology for the new index are available on this link.

Notwithstanding the slowdown seen in China in recent months, the country’s stainless steel industry has grown rapidly in recent years.

Preliminary figures from the International Stainless Steel Forum suggest that in 2011 production of crude stainless in China hit 12.6 million tonnes, up 11% on 2010’s output of 11.3 million tonnes, and 43% on the 8.8 million tonnes of output in 2009.

Prices paid for chrome will be watched…
Every tonne of that stainless steel — whether ferritic, austenitic or martensitic — contains a substantial portion of chrome.

The price paid in China is crucial to that country’s steel mills, but is also watched closely by market participants that are active in other regions as they seek feed for their mills or sell from their smelters.

They will study and use this transparent, reliable index price, based on transactions, bids and offers in the spot market.

But there have been other significant developments at Metal Bulletin in recent weeks.

This month, we began to publish a daily record of the arbitrage between copper, zinc and aluminium prices on the London Metal Exchange and the Shanghai Futures Exchange.

…as will the arbitrage between London and Asia
Metal Bulletin calculates the number daily at 3pm Shanghai time using prices on the respective exchanges, taking account of VAT and import duties, and exchange rates at the time of the comparison.

It is available every day on Metalbulletin.com.

Finally, Metal Bulletin’s daily premiums over London Metal Exchange prices for nickel, lead, zinc and aluminium in a range of global locations in Asia, Europe and the USA are now also available as daily email alerts alongside copper.

If you want any help from our customer service team in setting up alerts, drop them a line at help@metalbulletin.com.

And if you want to comment on prices, or find out more about how we price markets, contact the editor, Alex Harrison, on aharrison@metalbulletin.com

Alex Harrison
aharrison@metalbulletin.com
Twitter: @alexharrison_mb

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