LME refocusing billet contract on Turkey, Black Sea and Europe
The London Metal Exhange (LME) announced on November 30 that it will suspend Detroit, Chicago, New Orleans, Dubai, Johor and Incheon as billet delivery locations on the LME steel billet contract. The LME has thus retreated from the US market, after only two and a half years since it listed its first locations in the US as points of good delivery for its steel billet contract "to further support the use of the LME's hedging tools by market participants in the Cold Rolled Steel Coil
industry" back in June 2010.
The suspension of the US locations came just before the completion of LME's acquisition by Hong Kong Exchanges and Clearing Limited (HKEx) on December 6, following the announcement of the acquisition decision in June this year. Regarding the acquisition, HKEx chief executive Charles Li had said, "HKEx's ability to help the LME grow its business in Asia and beyond provides significant opportunities for both parties," signaling the beginning of a new period in the LME's 135-year history.
Against the backdrop of the significant changes affecting the LME in general and the LME's steel billet contracts in particular, Chris Evans, LME's head of business development, answered SteelOrbis' questions relating to developments in the marketplace.