LME may tune up Asian benchmark pricing, Liz Milan says

Apr 26, 2012 | 02:44 AM |

The London Metal Exchange may change its Asian benchmark price so that it is set in the moments that daily trading ends on the Shanghai Futures Exchange, rather than in the minutes afterwards as happens now. "We are looking to make that price more relevant by perhaps benchmarking against the actual Asia close in Shanghai," Liz Milan, the LME's Asia md, told Metal Bulletin. The revamped price would be one step by the LME to address "what we are offering in terms of how the contracts are trading, how the Asian markets see them, and how they'd like to trade them", Milan said. The revamped Asian benchmark would likely be a price snapshot at around 3pm Shanghai time, rather than the present weighted average of trades between 3 and 3.15pm in Shanghai. "That was an unofficial price just to show recognition of the market here. [We're thinking about] moving that to 3pm or around 3pm and adding some transparency there, with maybe a discount back to cash," she said. The LME launched an Asian benchmark price for three-month contracts in aluminium, copper, and zinc in January 2011,....