PRICING NOTICE: Amendment of arbitrage calculation for copper, aluminium, zinc, nickel

Metal Bulletin has amended its formula for calculating the daily copper, aluminium, zinc and nickel arbitrage between the Chinese and global metals markets.

As part of a separate consultation, Metal Bulletin proposed to discontinue the publication of single numbers for its base metals premiums and instead continue to publish low-high premium assessments.

Following the consultation and feedback from market participants and exchanges, Metal Bulletin will stop assessing single-number base metals premiums from Tuesday August 28.

Therefore, Metal Bulletin will use the midpoint of the copper, aluminium, zinc and nickel premiums rather than the single number for its LME-SHFE arbitrage calculation from August 28.

For copper: the formula consists of three parts:
a. SHFE front month contract close + spot premium/discount = China spot market price
b. (LME 3M + premium cif Shanghai) x 1.16% x Forex rate + 200 yuan = cost for imported copper
c. The final import arbitrage result comes from (a minus b).

1. The copper premium cif Shanghai will use the midpoint of the Metal Bulletin Shanghai cif daily copper premium range. We will also use the Metal Bulletin cif Shanghai premium midpoint for the aluminium arbitrage calculation, and the Metal Bulletin Shanghai warehouse premiums range midpoint for zinc and nickel arbitrage calculations.
2. Spot premium/discount = average premium/discount of SHMET, a local metal website, whose figures are widely used for spot trading in China.
3. Forex rate: using Bank of China’s currency sell price, at or around 15:00 every day.
4. 200 yuan in part b refers to port charges including clearance costs, warehouse fees, etc.
5. We use LME 3M copper at 15:00 Beijing time.
6. We also include the Chinese import tax for the metals in the calculation. For copper and aluminium there is no import tax, but there is 1% tax for zinc and 2% tax for nickel.

The arbitrage aims to provide a general benchmark for the market because we understand different companies and deals will have different costs, among other variables.

Please contact us on if you have any queries regarding the arbitrage.

All historical data relating to this arbitrage calculation will remain available in the pricing section of the Metal Bulletin website.

To provide feedback on this arbitrage calculation or if you would like to provide price information by becoming a data submitter, please contact Shivani Singh by email at: Please add the subject heading FAO: Shivani Singh, re: Arbitrage calculation.

To see all Metal Bulletin’s pricing methodology and specification documents go to  

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