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Metal Bulletin would like to invite participants in the cobalt market to contribute to a six-month consultation period, which may result in changes to its international cobalt metal pricing process.
The proposal below may be implemented from January 2015, if it is considered to be supported by market participants.
Low-grade proposal For a trial period from January 2015, Metal Bulletin will continue to publish low-grade cobalt metal prices on Wednesdays and Fridays.
But it is considering doing so solely on the basis of the London Metal Exchange prices, and not based on transactions gathered by its pricing reporters, as it has done historically.
If, following the six-month consultation period, the above change is implemented, the market will be informed well in advance of the date of implementation.
If implemented, for the trial period, which would last at least for one year, the Metal Bulletin low-grade cobalt range on Wednesdays and Fridays will be based on the London Metal Exchange official cash cobalt bid/ask prices on Wednesdays and Fridays.
An implementation date of January 2, 2015 is proposed.
High-grade The high-grade cobalt range, also currently published on Wednesdays and Fridays, will continue to be assessed by Metal Bulletin’s editorial team.
Both ranges will continue to be published on a dollar-per-lb basis (low-grade prices will be converted from an LME dollar-per-tonne basis to a dollar-per-lb basis), and prices will continue to be published online in the current format on Wednesdays and Fridays.
The aim of this move is threefold.
First: to ensure that market participants with long-term formulae based on the price published in Metal Bulletin have ample time before annual contracts are negotiated to move to LME-based outright pricing.
Second: to push further liquidity on to the LME from buyers and sellers that are linked to MB pricing and have an interest in price-making.
Third: to allow Metal Bulletin to focus on reporting the premiums/discounts for specific brands, enabling Metal Bulletin to bring more transparency to the market for professional operators in the cobalt business, in particular by publishing and representing the spreads between different grades, where production and consumption are growing at different rates.
Please contact fritzema@metalbulletin.com for more information or to contribute your views to the consultation.
Fleur Ritzema fritzema@metalbulletin.com Twitter: FleurRitzema_MB