Global – The London Metal Exchange’s steel scrap contract has scooped a top prize at the Futures and Options World (FOW) International Awards for the most innovative new contract in the commodities and energy sectors.
Launched a year ago and with users in Europe, North America and Asia, more than 450 000 tonnes has been traded on the contract thus far in 2016 – including 147 000 tonnes in October alone. Steel scrap open interest is also ‘steadily building’ and stood at 49 130 tonnes at the end of November, according to the LME.
The FOW awards recognise the best performance in cleared derivatives in a competition judged by independent industry experts. This accolade ‘is a testament to the strong growth in trading of our scrap contract over the last year’, states the LME’s head of business development Matthew Chamberlain. ‘With open interest gradually increasing, both our steel scrap and rebar contracts are being embraced as powerful risk management tools for the steel industry.’ For the first time, the exchange adds, the global industry ‘can take advantage of a 15-month tradable forward curve for steel scrap and rebar with bid/offer spreads as tight as US$ 0.50’.