The London Metal Exchange (LME), which claims to be the world’s premier non-ferrous metals market, has launched global futures contracts for PP and LDPE.
It says the move will enable the plastics industry to hedge against volatile polymer prices for the first time.
Since announcing its intention to launch the contracts, the LME says it has undertaken detailed research and consultation to ensure the contract specifications meet the plastics industry’s needs.
LME ceo Simon Heale says: “Price volatility is a long-term issue for users of these materials, especially the packaging industry, and the supply chain has, to date, lacked any tools to manage the related risk. Futures contracts will give the packaging industry the ability to manage price risk for the first time, enabling it to better forecast profits and concentrate on its drive for innovation.”