NEW YORK Alcoa Inc. called on the London Metal Exchange to provide a clear time line in which it plans to implement changes to create a more transparent marketplace.
Commending the exchange for taking steps today to introduce transparency through a Commitments of Traders style report, Pittsburgh-based Alcoa said it would "increase fairness and improve market function."
The company also said it supports the LMEs intention to examine creating premium contracts (amm.com, Nov. 7), which Alcoa recommended in its response to the LMEs proposed warehouse rule changes.
"Premium contracts would provide market participants the ability to hedge exposure to the all-in price. We look forward to working with the LME to develop these contracts," Alcoa said.
The aluminum producer also is supportive of the LMEs proposed physical market committee.
The LME needs to "focus on increasing confidence among market participants through greater transparency and premium contracts, and cautions against direct market intervention," the company, which has been a vocal critic of the LMEs planned warehouse rule changes, said.
"We are further encouraged by the LMEs intention to closely monitor the consequences of its newly adopted rules. Alcoa remains committed to continuing to work constructively with the LME to drive improvements in the marketplace," it added.