August 4, 2008
NYMEX to Launch Domestic Hot Rolled Coil Steel Futures Contract
NEW YORK, Aug. 4 /PRNewswire-FirstCall/ -- The New York Mercantile Exchange, Inc., a subsidiary of NYMEX Holdings, Inc. , today announced that it plans to introduce a futures contract based on prevailing market prices for hot-rolled steel coil in the U.S. Midwest region (U.S. Midwest domestic hot-rolled coil steel) early in the fourth quarter of 2008. The contract will be financially settled against an index developed by CRU Indices Ltd., a subsidiary of CRU International Ltd., a leading supplier of steel industry information.
The contract size will be 20 short tons with a minimum price fluctuation of $0.50 per short ton and the contract will be listed for 18 consecutive months. Final settlement on the monthly contract will be the average price calculated for all available price assessments published for that given month. The steel futures contract will be available for trading on the CME Globex(R) electronic trading platform, and off-exchange transactions can be submitted for clearing via NYMEX ClearPort(R).
NYMEX Chairman Richard Schaeffer said, "NYMEX's expansion into the steel market is a natural extension of our risk management business and we are pleased to offer a steel futures contract to serve the North American market. Managing price volatility has become a necessity for everyone involved along the steel supply chain and these contracts will assist the U.S. manufacturing industry in dealing with this issue."
"The NYMEX decision to license CRU's price assessments is yet a further endorsement of their accuracy, and of the robustness of our research procedures," said CRU Group Chairman, Robert Perlman. "Wherever steel is traded, from physical transactions to futures, we believe our price assessments give all participants the truest picture of the market."
The U.S. domestic steel sheet market is comprised of approximately 12 major steel mills that produce more than 50 million short tons of sheet products annually, with net hot-rolled coil representing nearly 20 million tons of this market. Physical trade in steel sheet takes place throughout the supply chain, and includes these mills, along with service centers, distributors, merchants and end-users. The CRU price assessments are based on actual spot transactions in the market, and all the data providers available to CRU are directly involved in buying and selling the relevant steel product on the spot market.
About the New York Mercantile Exchange, Inc.
The New York Mercantile Exchange, a subsidiary of NYMEX Holdings, Inc. , is the world's largest physical commodities exchange, offering futures and options trading in energy and metals contracts and clearing services for more than 400 off-exchange energy contracts. Through a hybrid model of open outcry floor trading and electronic trading on CME Globex(R) and NYMEX ClearPort(R), NYMEX offers crude oil, petroleum products, natural gas, coal, electricity, gold, silver, copper, aluminum, platinum group metals, emissions, and soft commodities contracts for trading and clearing virtually 24 hours each day. For more information, visit the NYMEX website at http://www.nymex.com/.
About CRU Group
CRU is an independent business analysis and consultancy group focused on mining, metals, power, cables, fertilizer and chemicals. Founded in the late 1960s and still privately owned, the group employs more than 200 experts in London, Beijing, Santiago, Sydney and the United States. CRU's Steel Business Group has over 30 full-time consultants researching and analyzing the steel, nickel and alloys industries. CRU's products for the steel industry analyze recent trends in market fundamentals and present forecasts of production, consumption, stocks and prices.
Forward Looking and Cautionary Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to our future performance, operating results, strategy, and other future events. Such statements generally include words such as could, can, anticipate, believe, expect, seek, pursue, and similar words and terms, in connection with any discussion of future results. Forward-looking statements involve a number of assumptions, risks, and uncertainties, any of which may cause actual results to differ materially from the anticipated, estimated, or projected results referenced in forward-looking statements. In particular, the forward-looking statements of NYMEX Holdings, Inc. and its subsidiaries are subject to the following risks and uncertainties: the success and timing of new futures contracts and products; changes in political, economic, or industry conditions; the unfavorable resolution of material legal proceedings; the impact and timing of technological changes and the adequacy of intellectual property protection; the impact of legislative and regulatory actions, including without limitation, actions by the Commodity Futures Trading Commission; and terrorist activities and international hostilities, which may affect the general economy as well as oil and other commodity markets. We assume no obligation to update or supplement our forward-looking statements.
NYMEX Holdings, Inc.
CONTACT: Anu Ahluwalia, +1-212-299-2439, or Brenda Guzman,+1-212-299-2436, both of NYMEX Holdings, Inc.; or Paul Scott of CRU,+44 (0) 20 7903 2185
Web site: http://www.nymex.com/