The London Metal Exchange has approved Chicago and Detroit as points of good delivery for its steel billet contract.

The new delivery points will be listed with effect from 16 November and the exchange intends to name storage facilities in due course.

The listing of new locations follows the LME’s announcement in June to establish its first US delivery location for steel in New Orleans.

The three US locations strengthen the LME’s existing network of steel delivery, which includes locations in South Korea, Malaysia, Belgium, Turkey, the Netherlands and Dubai.

Chris Evans, head of business development at the LME, says: “Volumes in the LME’s physically-deliverable contract are growing steadily as the steel industry recognises the benefits of price transparency and risk management that the exchange offers. Suppliers, mills, merchants and end users globally are able to use the LME to manage their cash flow and inventories, lock in margins and deal with price volatility.”

Volumes of steel futures traded at the LME have surged in 2010, and so far this year 91,133 lots have been traded, equivalent to 5.9 million tonnes with a notional value of USD2.8bn.