14 SEPTEMBER 2011CHINADAILY
Alumina price mechanism to change in near future
Edited by : AL CIRCLE
1 min read
The alumina price mechanism is facing challenges from the spot market. Now that iron ore, which has a 40-year tradition of long-term prices,has switched to the spot market this year,alumina will follow suit in the near future.
Former President Jiang Zeming,had conveyed that "China can grow fast only when it develops in a way that fits change in the world." The world is changing and that calls for change.
To be more specific, the aluminum industry is moving alumina to index pricing because it better reflects the fundamentals of the industry and will result in a fair price, based on real transactions, in a free market.
For example,currently, about 20 percent of Alcoa's alumina is sold on index basis or spot, and they expect to convert the remaining contracts over the next years.
Former President Jiang Zeming,had conveyed that "China can grow fast only when it develops in a way that fits change in the world." The world is changing and that calls for change.
To be more specific, the aluminum industry is moving alumina to index pricing because it better reflects the fundamentals of the industry and will result in a fair price, based on real transactions, in a free market.
For example,currently, about 20 percent of Alcoa's alumina is sold on index basis or spot, and they expect to convert the remaining contracts over the next years.
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