Alcoa (NYSE:AA) commends the London Metal Exchange (LME) for taking steps today to create a more transparent marketplace, which Alcoa recommended and industry participants broadly support. The immediate next step is for the LME to provide a clear timeline in which to implement this change. Alcoa believes this is key to ensuring a more transparent system which increases fairness and improves market function.
Alcoa supports the LME’s intention to examine creating premium contracts, which Alcoa recommended in its response to the LME’s 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 is also supportive of the LME’s proposed physical market committee, and welcomes the opportunity to participate on it.
Alcoa encourages the LME to focus on increasing confidence among market participants through greater transparency and premium contracts, and cautions against direct market intervention. We are further encouraged by the LME’s 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.
Alcoa is the world’s leading producer of primary and fabricated aluminum, as well as the world’s largest miner of bauxite and refiner of alumina. In addition to inventing the modern-day aluminum industry, Alcoa innovation has been behind major milestones in the aerospace, automotive, packaging, building and construction, commercial transportation, consumer electronics, and industrial markets over the past 125 years. Among the solutions Alcoa markets are flat-rolled products, hard alloy extrusions, and forgings, as well as Alcoa® wheels, fastening systems, precision and investment castings, and building systems in addition to its expertise in other light metals such as titanium and nickel-based super alloys. Sustainability is an integral part of Alcoa’s operating practices and the product design and engineering it provides to customers. Alcoa has been a member of the Dow Jones Sustainability Index for 12 consecutive years and approximately 75 percent of all of the aluminum ever produced since 1888 is still in active use today. Alcoa employs approximately 61,000 people in 30 countries across the world. For more information, visit www.alcoa.com, follow @Alcoa on Twitter at www.twitter.com/Alcoa and follow Alcoa on Facebook at www.facebook.com/Alcoa.
Kelly Pasterick, 212-836-2674
Monica Orbe, 212-836-2632
James Leviton, +44 (0) 7771 887977