The London Metal Exchange (LME) has today confirmed that the two regional steel billet contracts will commence trading on Monday 28 April 2008. The contracts cover two regions: Mediterranean and Far East.

Both contracts are physically deliverable; the initial delivery point for the Mediterranean will be Turkey, and Far East delivery point will be South Korea.

Further details of the contracts and the LME’s approach to risk management tools for steel will be outlined in a presentation by CEO, Martin Abbott, at Steelorbis Fall 07 Conference and 57th Irepas Meeting on September 9-11, 2007 in Warsaw.

Commenting on this announcement, Liz Milan, LME steel business manager said:

“Trading in steel will take place on all three platforms that the LME offers providing LME member firms with the flexibility that their clients demand. Official price discovery will take place on the ring as this is an excellent mechanism for concentrating liquidity. The contracts will trade for 15 months out and the first prompt date will be 28 July 2008. 

The market dialogue is ongoing, critically important and valuable. LME members have suggested that they could consider off-exchange trading in advance of the official Exchange launch. I am delighted that the launch is on track and that support is building. Later this year we will provide details of both the brands and the warehouses.”

Notes for Editors

1. The steel contract specification can be found at www.lme.com/steel
2. SteelFAQs for the steel contracts are available at http://www.lme.com/steel-faqs.asp
3. The LME is the world’s premier non-ferrous metals market and achieved volumes of 87 million lots in 2006, an increase of 10.6% on 2005 figures and equivalent to $8,100 billion in monetary terms. 
4. Trading at the LME in non-ferrous metals and plastics takes place across three platforms: through open-outcry trading on the “Ring”; through an inter-office telephone market; and through the electronic trading platform LME Select.
5. The LME is a demutualised, shareholder-owned organisation that currently operates a model in which fees are kept to a minimum and all surpluses are rebated to shareholders.