(01-175) Implementation of New Specialist Market Maker for Aluminum ,
 Notice # 01-175
May 23, 2001

TO:
All NYMEX and COMEX Members and Member Firms

FROM:
Neal L. Wolkoff, Executive Vice President

RE:
Implementation of New Specialist Market Maker for Aluminum Futures by Koch

=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=
=3D=3D=3D=3D=3D=3D=3D=3D=3D

The Exchange has executed an agreement with Koch Metals Division (=01&Koch=
=018), a=20
division of Koch Carbon, Inc., to serve as the new Specialist Market Maker=
=20
(=01&SMM=018) for Aluminum Futures. The new SMM program with Koch in Alumin=
um will=20
begin next week on Tuesday, May 29, 2001.  Please note that the terms of th=
is=20
new SMM program differ from the old SMM program with AIG:

! Unlike the prior SMM program, Koch will not have any responsibilities=20
regarding maintaining a limit order book or otherwise executing customer=20
orders.

! Instead, during the RTH session, Koch must maintain an orderly two-sided=
=20
market consisting of a current bid and offer quote for Koch=01,s proprietar=
y=20
account on a RFQ basis as provided below.

Trading up to Last Trading Day of Month Preceding Current Delivery Month

! Under normal market conditions, Koch must make a two-sided market for:

(a) a minimum of  25 contracts at a maximum bid/ask spread of 20 points for=
=20
the first 4 listed trading months;

(b) any consecutive four-month calendar strip during the first 12 listed=20
contract months for 10 contracts per month at a maximum bid/ask spread of 2=
5=20
points; and

(c) a minimum of 50 spread contracts at a maximum bid/ask spread of 20 poin=
ts=20
for any and all inter-month spreads involving the first 12 listed trading=
=20
months.

! In abnormal market conditions (as reasonably determined by Koch in good=
=20
faith) Koch must make a two-sided market for the quantities listed above bu=
t=20
at a bid/ask spread as determined by Koch in good faith.

Trading Between First Notice Day and Last Trading Day of Current Delivery=
=20
Month

! During this period, Koch will not be required to make quotes but instead=
=20
using reasonable discretion must make efforts under normal conditions to=20
provide quotes.

SMM Disclosure Statement

! Under the prior SMM program, which required the SMM to maintain a limit=
=20
order book of customer orders, Member Firms were required to distribute a=
=20
special SMM Disclosure Statement to a customer before that customer could=
=20
trade in an Exchange contract that had been designated with a SMM facility,=
=20
i.e., Aluminum.

! By contrast, because Koch as the new SMM will not be handling a limit ord=
er=20
book, the SMM Disclosure Statement will no longer be relevant, and the=20
Exchange is discontinuing use of this disclosure statement for the new=20
Aluminum SMM program with Koch.

If you have any questions concerning this new SMM program, please contact A=
l=20
Getz, Director of Metals Research, Research Department, at (212) 299- 2608;=
=20
Richard Strait, Director, Metals Marketing, Marketing Department, at (212)=
=20
299-2335; or Michael Campanelli, Vice President, Floor Department, at (212)=
=20
299-2072.



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