NEW YORK, Feb. 10 -- The London Metal Exchange said Tuesday that a second long-term physical cobalt contract using the exchange's pricing formula has been agreed between Jiangsu Cobalt Nickel Metal Co Ltd and LN Metals International Ltd.
Jiangsu Cobalt Nickel Metal Co Ltd agreed to a long-term sales contract with LN Metals International Ltd for its 2010 export quota of the company's KLK brand cobalt metal, which received LME brand registration on Jan. 29.
"Jiangsu's decision is a further significant development and reflects keen interest in the physical industry to take advantage of LME pricing and the Exchange's other services," the LME said in a statement.
Other producers, including Jinchaun Group, Sumitomo Metal Mining Co, Votorantim, Kasese, Norilsk Nickel and Vale Inco also have obtained LME registration.
Cobalt is a byproduct of nickel. It is used to make alloys for aero engines and batteries for hybrid cars.
The cobalt contract is set to launch on Feb. 22.
The LME trades non-ferrous metals, including its flagship copper contract, as well as steel, through open outcry, an inter-office telephone market and its own electronic trading platform, Select.