Cobalt smelters reluctant to use LME pricing for contracts

Nov 18, 2013 | 11:52 AM |

Tags  cobalt prices, London Metal Exchange, LME, China smelters, Freeport-McMoRan Copper & Gold, David Elliott

SHANGHAI — Some Chinese cobalt smelters have expressed reservations about using London Metal Exchange pricing in their long-term contracts.

Phoenix-based Freeport-McMoRan Copper & Gold Inc.’s decision last month to price its cobalt transactions on the basis of LME pricing starting in January paved the way for discussions about pricing mechanisms in China at last week’s Antaike cobalt conference.

While interest in the LME contract is growing, Chinese cobalt market participants, which traditionally have relied on AMM sister publication Metal Bulletin’s twice-weekly price assessments to settle long-term contracts, expressed a reluctance to immediately move onto exchange-basis pricing.....

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