#United States #New York #Platts #S&P Global #London Metals Exchange

A Decade of Excellence in Steel Futures

S&P Global Energy (previously known as S&P Global Commodity Insights) proudly celebrates the 10-year anniversary of its Platts steel scrap and rebar price assessments. These benchmarks serve as vital references for the London Metals Exchange (LME) futures contracts and signify a significant evolution in the realm of recycled steel markets.

Launched on November 23, 2015, the steel scrap and rebar futures contracts marked a crucial development in managing risks within an industry increasingly embracing sustainability. The contracts are settled against the Platts benchmarks for steel scrap and rebar, representing the cost of physical premium steel scrap delivered to Turkey—a key international hub for such materials.

The Platts HMS 1/2 8020 CFR Turkey benchmark focuses on heavy melting scrap and has been a key indicator of the cost structure associated with steel production in Turkey. Meanwhile, the Platts Steel Rebar benchmark, known as the Platts Steel Rebar free-on-board (FOB) Turkey price, represents the export value of rebar, emphasizing its significance in the finished steel sector.

According to Robin Martin, Head of Market Development at the LME, the past decade has seen a substantial uptake in the utilization of these steel futures contracts. He states, "Record volumes were noted in 2024, and with the integration of steel futures into more business models, we foresee a continued upswing in volume and liquidity.”

Matt Eversman, Director of Global Licensing and Exchange Relationships at S&P Global, echoed this sentiment, heralding the benchmarks' contributions to market transparency. "Our Platts assessments have enabled a clearer view of price movements and helped participants to navigate an ever-evolving market landscape,” he mentioned during the anniversary celebrations.

The importance of these benchmarks extends beyond mere pricing; they play a part in a larger phenomenon. For instance, the implementation of the Carbon Border Adjustment Mechanism, which will begin taxing imported steel products based on their carbon intensity starting in 2026, could promote interest in steel products produced from scrap. This factor may indeed enhance the economics of recycled steel, nudging more players toward the sustainable side of steel production.

S&P Global Energy, a premier provider of comprehensive data, analysis, and benchmarks for the energy and commodities sectors, recognizes the wide array of applications for its price assessments. These include facilitating the pricing of spot transactions, guiding risk management strategies, and serving as valuable references for governmental price formulas. The voluntary use of these assessments underlines their broad acceptance across markets, with many firms adhering to them as a standard practice.

In addition to the vibrant futures market, the Platts assessments provide a basis for evaluating market trends, supporting decision-making for both buyers and sellers. This helps them stay aligned with industry dynamics, ensuring they can remain competitive in a landscape characterized by rapid shifts in supply and demand.

As we look toward the future, the continued growth and acceptance of the Platts steel benchmarks signal a strategic alignment with emerging market trends focused on sustainability and carbon reduction. As the industry moves towards higher standards of corporate responsibility, S&P Global Energy’s role in these developments positions it as a linchpin in the evolution of global steel markets.

With this rich history and the promise of a sustainable future, S&P Global Energy and its customers can anticipate further milestones in the years to come, continuing their partnership to build a resilient and transparent market infrastructure.