Adjustment of SMM Copper Concentrate Index Methodology

Published: May 19, 2020 09:43

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SHANGHAI, May 19 (SMM) – We prepare to make following adjustments to the Methodology of SCCI：

1.Explain the weight calculation method of SMM transaction data and valuation mechanism:The calculation model of SMM copper concentrate index divides the copper concentrate spot market into three situations: active, relatively inactive and flat (no transactions).
The spot market will be considered as active when there are 5 or more trades over the week of assessment, and the SMM copper concentrate index will be calculated by weighted average of the normalised trade data.
When there are 1-4 trades done on a weekly basis, the spot market will be recognised as relatively inactive, and the SMM copper concentrate index will be calculated from normalised trade data and valuation. The weighted average value of normalised trade data will be given a weightage of 30%, while the weighted average value of valuation will be given a weightage of 70%.
SMM will deem no trades in the spot market in case of a lack of eligible transaction data for the week, and the standardised quotation/price valuation will be given equal weightage, and the SMM copper concentrate index will be obtained by taking the average. 1

2.Avoiding the impact of large-volume transaction on the index

In order to avoid the transaction of a single SMM copper concentrate index data provider from having an impact on the index, which may result in the deviation of the SMM copper concentrate index from the actual spot market situation, the weightage for calculation will be adjusted accordingly when SMM finds in the process of index calculation that the transaction data provided by a single data provider exceeds 25% of the total weightage of the SMM copper concentrate index.

The weightage of the price data provided by the data provider will be reduced to 25%, and the weightage of other transaction data for the week will be reduced accordingly according to proportion. Correspondingly, SMM will introduce a price valuation mechanism or increase the weightage of the price valuation mechanism for the week, so that the index calculation weightage for the week adds up to 100%.

For more information on the SMM Copper Concentrate Index methodology, please contact us:

Logan Lu：+86 02151595830 loganlu@smm.cn

Ye Jianhua：yejianhua@smm.cn yejianhua@smm.cn
Vyron Chen：+86 02151666843 Vyronchen@smm.cn

Newly Methodology of SMM Copper Concentrate Index（Download）：

Methodology of SMM Copper Concentrate Index(New)

Copper Index Smelter TC treatment charge

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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