The London Metal Exchange (LME) last Friday commenced spot or cash trading, marking the end of the launch period, for both the Mediterranean (FM) and Far East (FF) LME steel billet futures contracts.
The first cash dates falling due provide the steel billet industry with access to valuable daily spot reference prices, and offers market participants the full flexibility of a range of daily trading dates out to 3 months.
Steel billet futures can now be traded every business day out to 3 months, then weekly, every Wednesday of the week, months 3 to 6, then monthly, every 3rd Wednesday of the month and months 7 to 15.
Commenting on the introduction of spot trading LME commercial director, Liz Milan said, “For the first time in the history of the steel billet industry, the physical market will have access to a transparent exchange traded spot price. This marks the end of the launch period for the contracts, and the start of their development as fully fledged LME contracts.”
Since the launch, the contracts have traded over 1.22 lakh tonne, with a turnover in excess of $129 million.
On February 25, 2008 the exchange launched steel billet futures contracts for the Mediterranean and Far East regions.