AMT steps up involvement with LME ferrous contracts

AMT steps up involvement with LME ferrous contracts

London-based brokerage agrees to be liquidity provider for ferrous scrap and steel rebar contracts.

December 3, 2018
Brian Taylor

London-based Amalgamated Metal Trading Ltd. (AMT) has reportedly been appointed by the London Metal Exchange (LME) as a liquidity provider for the LME’s ferrous scrap and steel rebar contracts.

According to an online article by Reuters, AMT’s liquidity commitment should provide “a boost” to the scrap and rebar trading markets, with AMT becoming the first LME ring trader to assume the role of liquidity provider.

According to the Reuters report, AMT is one of only nine “top tier” LME members allowed to trade in the LME’s open outcry ring and via telephone and on the exchange’s electronic system, meaning it is positioned to “offer deeper liquidity than some peers.”

On its website, AMT describes itself as “leading LME broker with a client base [that] is active in all aspects of the metal business and in many countries of the world.” The company says it “provides market-making and brokerage services to the metal industry from its head office in London and through its representative office in Shanghai.”

On Dec. 1, AMT joined four existing liquidity providers (Alpha Academic Ltd, Ferrometrics LLC, Gerald Metals SA and Nine Square Multi Trading DMCC) serving the LME ferrous scrap and rebar contracts.

The LME, which is part of Hong Kong-based Hong Kong Exchanges and Clearing Ltd. (HKEX), launched its ferrous scrap and rebar contracts in 2015, with the scrap contract experiencing growing activity in 2018.

Through the first 10 months of 2018, more than 417,000 lots (4.17 million metric tons) have been traded on the LME ferrous scrap contract while fewer than 50,000 lots (500,000 metric tons) have been traded on its steel rebar contract.