The contract will be the first ferrous-scrap futures available to the U.S. steel industry, according to Chicago-based CME. It will complement hot-rolled coil steel derivatives that the exchange already offers, said Youngjin Chang, the director of metals research and product development at CME Group.
The CME and the London Metal Exchange started steel futures in 2008 amid concern from producers including U.S. Steel Corp. and ArcelorMittal that it would fuel speculation. World demand for scrap steel this year will be 530 million metric tons, 24 percent more than in 2009, according to Ken Hoffman, an analyst at Bloomberg Industries in Skillman, New Jersey. The size of the global crude-steel market is about 1.5 billion tons, he said.
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