The New York Mercantile Exchange, Inc. (NYMEX), a subsidiary of NYMEX Holdings, Inc., announced in a press release on Monday its plans to launch a steel futures contract for domestic steel hot rolled coils (HRC).
NYMEX plans to introduce the 20 net ton (nt) HRC steel futures contract in the US Midwest region early in the fourth quarter of this year. The 20 nt contract will have a minimum price fluctuation of US$0.50 /nt and will be listed for 18 months consecutively.
The contract will be financially settled against an index developed by a supplier of steel industry information, a subsidiary of CRU International Ltd, CRU Indices Ltd.
The steel futures contract will be available for trading on the CME Globex electronic trading platform, and off-exchange transactions can be submitted for clearing via NYMEX Clearport.
Richard Schaeffer, NYMEX chairman, commented, "NYMEX's expansion into the steel market is a natural extension of our risk management business and we are pleased to offer a steel futures contract to serve the North American market. Managing price volatility has become a necessity for everyone involved along the steel supply chain and these contracts will assist the US manufacturing industry in dealing with this issue."