Busheling contract said gaining traction

Sep 19, 2012 | 04:42 PM | Anne Riley

Tags  scrap, busheling, AMM, CME, Kataman Metals, Brad Clark

NEW YORK — Recent physical scrap market volatility is unlikely to abate soon, making CME Group Inc.’s nascent No. 1 busheling futures contract an attractive tool for market players looking to mitigate pricing risk, Kataman Metals LLC director of steel trading Brad Clark said.

"The run-up in 2008 and then the subsequent events created such an unevenness and inconsistency in demand across all asset classes, all commodity markets, and it doesn’t look to me to be ebbing anytime in the near future," Clark told AMM. "Scrap is volatile by the nature of the business. This volatility is set to continue due to the uneven global growth on the demand side."

With global commodities markets—including the domestic ferrous scrap market—expected to see continued fluctuations in pricing for the foreseeable future, the Chicago exchange’s newest futures contract could be set to gain some rapid traction, he said. ....

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