LME to discuss ferrochrome, stainless scrap contracts

The London Metal Exchange would be open to discussing potential new cash-settled futures contracts for stainless steel scrap and ferrochrome, depending on market demand, according to Alberto Xodo, Product Specialist for Steel & Nickel at the LME.

South African miner Merafe Resources said the EUBM pricing system had become “less relevant” for market participants, adding that “Glencore/Merafe will continue to focus on finding market relevant pricing mechanisms with each customer,” but adding that Merafe would not be announcing any of these pricing mechanisms.

Xodo also noted that there has been some market interest in a potential domestic European grade-304 stainless steel scrap futures contract.

The LME CFR Turkey scrap futures contract, which settles against the monthly average of the Platts daily assessment, has seen 5.45 million mt traded so far in 2024, up sharply from 4.01 million traded in the January-May 2023 period.

Class 1 Nickel refers to nickel metal which has a minimum 99.8% nickel content and is physically deliverable to an LME warehouse, while Class 2 Nickel refers to lower-purity nickel products, such as ferro-nickel and nickel pig iron (NPI).

However, nickel sulfate, a key raw material in the battery cathode supply chain, tends to be priced as a premium over LME Nickel, outside of China.

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