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1 November 2010: NOS Clearing selects TSI’s iron ore prices

Oslo-based NOS Clearing (NOS), a subsidiary of the Imarex Group, today launches a clearing service for iron ore futures and option contracts using The Steel Index (TSI) iron ore reference price for settlement.  It becomes the fourth major clearing house in the world to use TSI’s iron ore index.

“We are delighted NOS has selected TSI’s iron ore index for settlement of its contracts,” says Steven Randall, Managing Director of TSI. “OTC iron ore trading is one of the fastest growing commodity markets and NOS’s entrance helps to meet the growing customer demand. TSI’s iron ore prices have been adopted as the industry standard worldwide, with over US$3 billion of swaps already cleared against its index. But with around 1 billion tonnes of iron ore shipped this year alone, the potential futures market is many multiples of this," he adds.

NOS’s contract lot size is 1,000 metric tonnes and is cash-settled using the average of TSI’s daily 62% Fe iron ore reference prices published in the expiring month. It will initially offer clearing for monthly swap contracts forward for 24 months.

Morten Erichsen, Managing Director of NOS said: “We were approached by our members and we are happy to be the first to offer a full suite of financial contracts to the Iron Ore market.”

TSI’s daily iron ore reference prices have won widespread industry support for their accuracy and the rigorous, verifiable methodology used. Its prices are based on transaction data submitted by industry participants across the supply chain directly to TSI through secure on-line systems.

In selecting TSI for its iron ore contract, NOS Clearing follows in the footsteps of the Singapore Exchange (SGX), which launched the world’s first iron ore clearing service on 27 April 2009, London-based LCH.Clearnet and Chicago-based CME Group which began trading on 1 June 2009 and 11 July 2010 respectively. Ends

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