London commodities consultant CRU Group announced last week that the CRU Alumina Price Index (CRU-API) successfully completed an external assurance review in preparation for today’s launch of LME’s new cash-settled alumina futures contract.
The review, which was undertaken by PricewaterhouseCoopers LLP (PwC), was part of a report prepared by the Group to demonstrate the index’s adherence to standards set forth by the International Organization of Securities Commissions’ (IOSCO) Principles for Oil Price Reporting Agencies.
“CRU’s report demonstrates its ongoing commitment to providing the most robust price benchmarks for physical and derivative markets through a range of strong and appropriately designed policies and procedures in accordance with the requirements of the IOSCO Principles,” explained CRU Group CEO David Trafford. “Together with our company’s values of quality and integrity, and our market-leading research and analysis capability, our IOSCO adherence is a crucial pillar that engenders the market’s trust in our prices.”
“The correct structures, operation of processes and application of the best and most appropriate methodologies are essential in upholding the proper governance of CRU’s prices,” elaborated CRU’s Compliance Lead Claire Ballak. “We have and we will continue to invest in our compliance function, analysts, systems and independent external review and assurance. This will ensure our price assessments endure as the most reliable indicators of commodity market values in the service of our stakeholders.”
Per CRU, third-party research indicates that the CRU-API enjoys wide use in the settlement of physical contracts, which the firm expects will continue under the London Metal Exchange’s alumina futures contract that debuted earlier today.