According to the LME report, 12,284 lots were traded in the first six months of 2009 representing 798,460 mt of material with a value of $263.4 million, while June was the largest traded month of the current year for the combined contracts, showing an upturn of 48.7 percent in trading activity compared to May. The previous largest month for the combined contracts was April, the LME said.
In the LME report, the monthly trade volumes in lots in the first half of 2009 are as follows:
Month |
Total |
Jan |
1,994 |
Feb |
2,176 |
Mar |
1,756 |
Apr |
2,267 |
May |
1,645 |
Jun |
2,446 |
"The number of brands supporting the contracts rose to 41 with the addition of Turkey's Kaptan Iron and Steel Company in June," said the LME, adding, "28 members have traded the contract since its launch in April 2008."
Commenting on the results, LME chief executive Martin Abbott said, "It takes years for new contracts to grow to liquidity levels enjoyed by our established non-ferrous contracts like those in aluminum and copper, but the steel billet contracts are working well and establishing strong roots in the industry. The adoption by producers and the financial community has far exceeded our expectations and despite tough economic conditions, it is clear the market sees value in this offering."
Lotta Ulsfdotter, business manager for steel at the LME, added, "Since we launched the contracts a year ago, the market has traded 1,836,250 mt or 28,250 lots with an equivalent financial value of US$854.6 million. Our goal was to provide the industry with tools for managing exposure to price volatility through hedging or price risk management and these results demonstrate we are achieving our goal."