While midpoint pricing on indexes isn’t new, it could be a good interim solution to the problem plaguing index pricing until a better alternative appears for bulk ferroalloys. It was NEVER written in stone that the low end of the range was THE price and the high was just a give away. At best the low was the point where most of the business was concluded. A single number. But using the low also failed to take into consideration the direction of the market. If the index covered a few days of business, what happened if the majority of business was done and then the market started moving in different direction? Should the direction of the market be ignored even though most of the sales were done at a different level. Also, what happens if there is only one deal in the index. How is that accounted for?
It’s as much art as science.