To: All Members

Ref: 10/364:A356
Date: 18 November 2010
Subject: LAUNCH OF LME ASIAN BENCHMARK

Summary

1. From Monday 24 January 2011 the LME will publish three–month futures prices for
copper, primary aluminium and zinc at 8.30am London time.

Background

2. The growth in early morning trading on LMEselect reflects the increasing demand in
Asia for access to LME trading. In order to reflect this Asia trading activity the Exchange
has decided to publish three-month futures prices for copper, primary aluminium and zinc.
These Asian benchmark prices will mark the transition from the Asian time zone to London
hours.

Timing

3. The Asian benchmark for three months will be established from trading volumes on
LMEselect between 8.00am and 8.15am on a daily basis. The publication of the Asian
benchmark will be at 8.30am.

4. The LME will publish the Asian benchmark on every Business Day it is open with
effect from Monday 24 January 2011.

Methodology

5. The Asian benchmark will be established on LMEselect using a calculated trade

weighted average price over a 15 minute pricing period between 8.00am and 8.15am. The
following example shows how this calculation works:

Lots Price Tonnes per lot Contract value

10 $3,900.00 25 $975,000.00
8 $3,904.00 25 $780,800.00
7 $3,902.00 25 $682,850.00
1 $3,900.00 25 $97,500.00
16 $3,901.00 25 $1,560,400.00
10 $3,903.00 25 $975,750.00
52 25 $5,072,300.00

$5,072,300 divided $3,901.77

by 25 divided 52
6. The minimum volume requirement threshold for the calculation of the Asian
benchmark is 50 lots for copper and primary aluminium, and 25 lots for zinc.

7. If the minimum volume requirement threshold for the calculation of the Asian
benchmark is not reached then the fair value methodology will be used by the LME
Quotations Committee taking into account the following:

• Any trades, bids and offers in the official pricing period

• Any trades, bids and offers prior to the official pricing period

• Matched trades displayed on PTT

• Any indicative bids and offers from LMEmiq

• Quotes requested from members of the LME Quotations Committee

• The Official, Closing Prices or Asian benchmark from the previous day

If there is an outage on LMEselect the fair value methodology will be used to publish the
Asian benchmark.

8. The Asian benchmark will be communicated to LME members and users as soon as
possible after the end of the pricing period finishes at 8.15am, with five minutes being the
target. LMEselect users will then have five minutes to object. Thereafter, the Asian
benchmark will be finalised and disseminated to vendors via MDD at around 8.30am.

General

9. The introduction of an Asian benchmark for other non-ferrous metals and steel will
be considered in the future, subject to demand.

10. If LME members or users have any questions, please contact Peter Childs at
peter.childs@lme.com.

Peter Childs
Head of Market Operations
cc: Trading Committee, Board Directors