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LME Roundup – LME Introduces New Programs, While Premiums Sag

August 4 –Aluminium prices not curbing Chinese output,” The Australian Business

August 19 –Is another showdown looming on aluminium spreads?” Gulf Times

August 20 –LME plans to introduce ‘market-making’ programs,” Platts

The London Metal Exchange said Thursday it plans to introduce market-making programs to support the launch of new products and enhance liquidity on existing contracts. These are the first programs of their kind to be introduced by the LME in its 138-year history, the exchange said in a statement.

“The programs will provide market makers for the LME’s forthcoming aluminium premium contract and two new ferrous contracts — steel scrap and steel rebar — set for launch on November 23, 2015,” it said. “The LME is also today announcing a similar market-making program, coming into effect on October 1 2015, to boost existing third Wednesday contract liquidity on LMEselect as part of its Liquidity Roadmap initiative.”

August 20 –Aluminum market ‘deathly quiet’,” American Metal Market

August 21 –Aluminium sector too needs 5-10% import duty hike: Hindalco,” CNBC – Money Control

Satish Pai, Deputy Managing Director (MD) of Hindalco told CNBC-TV18 that the aluminum industry would like a 5-10 percent hike in the import duty to ensure minimum damages to domestic manufacturers.(VIDEO)

August 22 –Treat aluminium as core metal; increase import duty: Vedanta,” CNBC  – Money Control

Abhijit Pati, CEO-Aluminum, Vedanta says aluminium’s London Metal Exchange (LME) price has slid down to sub1600 level, one of the lowest level of 6 yrs. (VIDEO)

August 25 –Alcoa will meet CFTC to challenge LME warehouse reform,” Reuters

September 1 –Collapse in premiums hits aluminium trade,” Financial Times

September 4 –CME Group Expands Base Metals Offering with New Aluminium European Premium Futures,” Press Release

CME Group, the world’s leading and most diverse derivatives marketplace, today announced it will expand its base metals offering with the introduction of a new Aluminium European Premium Duty-Unpaid (Metal Bulletin) futures contract to begin trading on 21 September, 2015. Pending relevant regulatory review periods, the new contract will be available for trading on CME Globex and for submission for clearing through CME ClearPort, and will be listed with and subject to the rules and regulations of COMEX.
“Our new contract will be the first viable exchange-traded futures product to enable customers and market participants to hedge their exposure to the European aluminium premium,” said Young-Jin Chang, CME Group Senior Director of Metals Products. “This is a continuation of our commitment to engage with customers and market participants in the aluminium industry around the globe. We continue to work closely with the industry to provide them with innovative new solutions to manage aluminium premium volatility, which has reached record levels during the last three years.”
These new contracts will complement CME Group’s existing suite of aluminium risk management tools, including its Aluminum MW U.S. Transaction Premium futures and physically delivered Aluminum futures. Industry participation in the Aluminum Midwest Premium contract has steadily increased, trading the equivalent of more than 650,000 metric tons since their launch in April 2012 and reaching a record 19,335 contracts open interest on 1 September 2015. Aluminum futures, which were introduced in May of last year, serve as a reference price for the North American aluminium industry and allow participants to better manage their price risk.
The Aluminium European Premium futures contract will be 25 metric tons in size and will be financially settled against the Metal Bulletin assessment of aluminium spot price transactions in Europe.

September 7 –JPMorgan to stop open outcry on London Metal Exchange,” CNBC

September 11 –LME now accepting tenders for ​market making programmes,” LME

As part of our drive to enhance liquidity, increase trading and offer greater access to our markets, the LME is introducing market making programmes for copper, aluminium and zinc.   

September 15 –London Metal Exchange plans to introduce position limits,” Reuters

The London Metal Exchange (LME) plans to introduce limits on large positions for the first time to avoid market squeezes, initially on its new aluminium premium contract, it said on Tuesday.  The use of position limits may be expanded to other contracts if upcoming legislation requires them, the exchange added in a statement.

September 15 –European aluminum alloy market stabilizes after Q4 buying splurge,” Platts

September 18 –INTERVIEW: More aluminium cuts to come, says UC Rusal exec,” Metal Bulletin

There have already been cuts of around 1.5 million tonnes of capacity this year to date, company deputy ceo Oleg Mukhamedshin told Metal Bulletin. The majority of the new cuts will come from China, where more than 60% of capacity is unprofitable at current prices compared with a global figure of around 35% of capacity being under water. “We expect between two and three million tonnes [of cuts in China] by the end of this year,” Mukhamedshin said. “A further 500,000 tonnes of cuts will come this year in the world ex-China. We’ve already seen some cuts, such as by Alcoa and Century Aluminum,” he added.

September 22 –LME to launch system to better track metals after Qingdao fraud,” Reuters

The new system, called LME Shield, will launch in December, and will allow the exchange to provide electronic receipts for metal stored outside its system, LME head of business development Matt Chamberlain said during a presentation at Metal Bulletin’s International Aluminum Conference in Vancouver.  Chamberlain had previously told Reuters that the world’s oldest and biggest metals market was considering expanding its electronic LMESword system, which proves the origin and title to LME-warranted metal, beyond exchange stock after receiving requests from several banks that finance big tonnages of metal.

September 24 –LME said main driver of aluminum premium sag,” American Metal Market

The London Metal Exchange’s forward curve is the key factor driving regional aluminum premiums lower, not an overflow of material from China, according to one metals analyst.

September 30 –CME Group – First Trades of Aluminum European Premium Futures,” Press Release

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