What is the LBMA?
LBMA · London Bullion Market Association
Sets the standards and reference prices for precious metals. Silver and gold contracts are typically written against the LBMA price for a stated pricing date, with delivery quoted loco a named vault city.
Key points
- Not an exchange — it sets standards and administers reference prices.
- Good Delivery accreditation is what gives a bar its liquidity.
- Metal is quoted loco; the location clause matters as much as the price.
At a glance
| Full name | London Bullion Market Association |
|---|---|
| Gold Good Delivery | ~400 troy oz, 995 minimum fineness |
| Silver Good Delivery | ~1,000 troy oz, 999 minimum fineness |
| Price setting | Electronic auction, gold twice daily, silver once |
| Wholesale standard location | Loco London |
What the association is
The London Bullion Market Association oversees the over-the-counter wholesale market for gold and silver. It is not an exchange: it sets standards, accredits refiners and administers the reference prices the market trades against.
Its two most consequential outputs are the Good Delivery List and the LBMA price.
Good Delivery
Good Delivery specifies what an acceptable wholesale bar is — weight range, minimum fineness, appearance and markings — and which refiners may produce them. Gold Good Delivery bars are approximately 400 troy ounces at 995 minimum fineness; silver bars are around 1,000 ounces at 999.
Accreditation is what gives a bar its liquidity. Metal from a listed refiner moves in the wholesale market without re-assay; metal from an unlisted one generally does not, whatever its actual purity.
Price and location
The LBMA gold and silver prices are set twice and once daily respectively through an electronic auction, and are the benchmarks most physical contracts reference for a stated pricing date.
Precious metal is also quoted loco — at a location. Loco London is the wholesale standard; metal held elsewhere trades at a differential reflecting the cost and risk of moving it, which is why the location clause matters as much as the price clause.
Frequently asked questions
- What is LBMA Good Delivery?
- A specification for wholesale gold and silver bars covering weight, fineness, markings and the refiners permitted to produce them. Bars meeting it trade in the wholesale market without re-assay.
- What fineness is a Good Delivery gold bar?
- 995 parts per thousand minimum, in a bar of approximately 400 troy ounces. Silver Good Delivery bars are 999 minimum at around 1,000 ounces.
- What does loco London mean?
- That the metal is held in London. Precious metals are priced by location, and metal held elsewhere trades at a differential reflecting the cost and risk of transporting it.
Related terms
The pricing reference for base metals including aluminium, copper, zinc and tin. Most physical contracts are written as the LME cash or three-month price plus or minus a negotiated premium reflecting grade, location and delivery terms.
The defined period whose average exchange price sets the contract price — for example the month following shipment. Because prices move during transit, the QP determines who carries that exposure.
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