The London Metal Exchange (LME) has today signed an agreement with the Shanghai Futures Exchange (SHFE) to launch an LME-listed futures contract that will allow market participants outside China to acquire exposure to the SHFE flat steel market.
The new LME contract – LME Steel HRC Shanghai – will be cash-settled against the Steel HRC Shanghai (SHFE) monthly US dollar price. The necessary currency conversions and other pricing tasks will be undertaken by Commodity Pricing and Analysis Limited (CPAL), a sister company to the LME.
John Williamson, LME Chairman, said: “This is an exciting development for both markets. It will give companies outside China easier access to one of the world’s most liquid commodity contracts alongside the simplicity of trading a cash-settled LME contract.
“Our suite of cash-settled steel contracts will be enhanced by this agreement and it will strengthen the LME’s links with the world’s largest producer and consumer of metals.”
Mr. Tian Xiangyang, Chairman of SHFE, said: “China has a large-scale and well-established steel industry, supported by a mature and well-regulated futures market.
"This cooperation will further attract global steel enterprises and financial institutions to participate in price formation, and continuously enhance the international influence of China's steel futures products."
Trading is expected to commence in October 2026, and the LME will announce a launch date for the contract following final regulatory non-objection.
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Notes to Editors
- Further details about the contract can be found in Notice 26-161 (PDF)
- In October 2025, the LME and HKEX Group announced the formation of Commodity Pricing and Analysis Limited (CPAL) as a new Group subsidiary in Dubai to serve as a pricing administrator. CPAL has since established the “LME Insight” brand, and its website provides metal markets news and analysis with a focus on transition metals and related industries.
- The full methodology for pricing the new contract can be found on https://www.lmeinsight.com/
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Miriam Heywood
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