The intention is to reduce the minimum tonnage for trades included in the index to 5,000 tonnes, from 10,000 tonnes at present. While it is understood that 5,000 tonne cargoes are rarely traded, this reduction will reduce the impact of non-transaction data (bids, offers, deals heard and assessment) on the final index calculation.
During times of low liquidity, non-transaction data is included in the index calculation, weighted at the minimum tonnage. Confirmed trades are given their full weighting in the final calculations.
In addition, Metal Bulletin intends to change the deadline for data submission to 3pm London time, from 2pm at present. The index will be published between 3pm and 4pm, London time, compared with between 2pm and 3pm at present.
The changes outlined above are in line with those proposed for Metal Bulletin’s fob Australia alumina index.
The fob Brazil alumina index is calculated as a discount or premium to the fob Australia benchmark, and will continue to be published fortnightly on Thursdays.
In addition Metal Bulletin intends to increase the frequency of its inferred fob Brazil alumina index to daily, to match the proposed daily publication of the benchmark fob Australia alumina index.
The full specification for the fob Brazil alumina index, incorporated the proposed changes outlined above, is as follows:
Description: Alumina index, fob Brazil (adjustment)
Units: US$/dry metric tonne
Basis: fob Vila do Conde, Brazil
Grade: Smelter grade alumina, min purity of 98.5% Al2O3
Loading port: Vila do Conde (other ports normalised)
Material destination: All destinations
Trade size: Minimum 5,000 tonnes
Loading window: Within two months
Delivery method: Bulk carrier
Payment terms: 30 days after loading
Publication: Fortnightly on Thursdays between 3pm and 4pm London time.
Note: Published as a discount or premium to Metal Bulletin’s fob Australia alumina index
Description: Alumina index, fob Brazil (inferred)
Units: US$/dry metric tonne
Basis: fob Vila do Conde, Brazil
Grade: Smelter grade alumina, min purity of 98.5% Al2O3
Loading port: Vila do Conde (other ports normalised)
Material destination: All destinations
Trade size: Minimum 5,000 tonnes
Loading window: Within two months
Delivery method: Bulk carrier
Payment terms: 30 days after loading
Publication: Every weekday between 3pm and 4pm London time
Note: Calculated by netting the fob Brazil adjustment against the fob Australia alumina index
The consultation period for this proposed amendment will end one month from the date of this pricing notice, on Friday November 24. Changes will take place, subject to the results of this consultation, during the week commencing Monday November 27.
To provide feedback on the amendments outlined above, or if you would like to provide price information by becoming a data submitter to the alumina indices, please contact Charlotte Radford by email at: pricing@metalbulletin.com. Please add the subject heading FAO: Charlotte Radford, re: fob Brazil alumina index.
Full details concerning the proposed changes to the fob Australia alumina index are here.
See all Metal Bulletin’s pricing methodology and specification documents here.
