The London Metal Exchange (LME) has today confirmed that trading in its new LME Steel HRC Shanghai futures contract will commence on 27 October 2026. This contract settles to the globally respected Shanghai Futures Exchange (SHFE) hot rolled coil (HRC) steel price and marks the first time that SHFE has made a metals price available for trading on another exchange.
The new LME contract will provide an additional access route to a key commodity contract for international firms and will be cash-settled against the SHFE HRC RMB price, converted into US dollars. The necessary currency conversions and other pricing tasks will be undertaken by Commodity Pricing and Analysis Limited (CPAL), a sister company to the LME.
MiRan Park, LME Chief Business Officer, said: “I am thrilled to be able to confirm the launch date for our new contract. From next month, the LME will be providing the market with a straight-forward route to accessing what is widely regarded as the global benchmark for the flat steel sector, offering ease of access for offshore participants of the LME. With an average bid offer of one tick, hundreds of lots quoted on each side and an average daily volume of almost 700,000 lots per day, the SHFE HRC contract is one of the most successful commodity contracts in the world.”
Zhang Ming, Executive Vice President of SHFE, said: “We are very much looking forward to the launch of the LME Steel HRC Shanghai contract in October. As a globally recognised exchange, the LME has a broad international market presence. By licensing the settlement price of SHFE HRC futures to the LME, we aim to provide Chinese and overseas companies engaged in global HRC trade with a more direct and effective risk-management tool, while further strengthening the links between China’s steel industry, the Shanghai price and global markets.”
Significant effort has been invested to ensure that the contract design reflects the liquidity dynamics of the underlying SHFE hot rolled coil contract, together with the global nature of the LME’s trading community – the details of which are provided in the notes below and on the LME website.
Today the LME is also publishing the details of the dedicated incentive programme to provide quotes for the LME Steel HRC Shanghai contracts on the LME’s electronic trading platform, LMEselect, based around the active months that have the most liquidity on the SHFE market. The programme has been designed following positive engagement with several liquidity providers in China, Europe, America and the Middle East.
Contract details
The contract design details are as follows:
- Contract expiry day: The final day of trading (expiry day) for each monthly LME Steel HRC Shanghai contract will be the 15th of the month if that day is a business day in the People’s Republic of China (PRC), the UK and the USA. Otherwise, the last trading day in respect of that month shall be the first day prior to the 15th, which is a trading day in the PRC, the UK and the USA. For example, the November 2026 LME Steel HRC Shanghai contract will expire on Friday 13 November 2026 (because 15 November 2026 is a Sunday).
- Termination of trading and matching/clearing deadlines: On the expiry day, trading in the front month of the LME Steel HRC Shanghai contract will terminate at 08:00 London time. The deadline for the matching and clearing of all trades in the front month contract is 10:00 London time.
- Settlement price: On the expiry day, the Final Settlement Price will be published by CPAL. In summary, CPAL’s procedure is to take the daily settlement of the SHFE HRC contract delivering in the following calendar month and convert it into US dollars. For example, the November 2026 LME Steel HRC Shanghai contract will settle to the daily settlement price (as published by SHFE on 13 November) of the December 2026 SHFE HRC contract. Full details of the CPAL conversion methodology are available on the CPAL website.
- Why the next month’s SHFE contract is used: : This approach, which has been validated by market discussions, reflects the liquidity dynamics of the SHFE HRC contract, where trading volumes and open interest roll from the front active month to the second active month approximately one month before contract expiry.
- Monthly naming convention: The LME has adopted its standard naming convention of assigning contract months to the LME Steel HRC Shanghai contracts based on the month on which that contract settles on the LME. As set out above, this means that market users need to bear in mind the relevant month correspondences between LME and SHFE:
LME month Corresponding SHFE month November December December January January February February March March April April May May June June July
July August
August September
September October October November
Notes to editors
- The LME announced the new contract in June 2026.
- SHFE HRC’s average daily volume for 2025 was 690,000 lots
- Further details about the contract can be found on the LME website.
- 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.
- The full methodology for pricing the new contract can be found on CPAL.
Contact us
For further information or to speak to an LME spokesperson, please contact:
Miriam Heywood
+44 (0)7554 667 846
Joseph Eyre
+44 (0)7740 413 234