) has decided to pull the plug on its plastics futures contracts for polypropylene and linear low-density polyethylene, with the last prompt date for all existing contracts to be April 29, 2011. The decision to delist the contract was taken by the LME's board, on the basis of a recommendation by its executive committee. As part of the move, the exchange has decided that the costs of withdrawing outstanding warrants from the LMEsword depository will be waived. At this time, current open interest for all plastics contracts is 228 lots, going out to March 2011.

Following their launch on May 27, 2005, the LME made numerous changes to the contracts in a bid to increase interest in them among producers, distributors, and converters of resin, as well as financial players. In the end, however, the LME said it never achieved the level of liquidity necessary for a self-sustaining market, noting that "no significant volume or open interest has been established, and the exchange believes that this position is unlikely to change in the foreseeable future. It has therefore decided to focus its efforts and resources on other opportunities."

LME CEO Martin Abbott stated in a release that, "The Exchange and its committee members have put considerable effort into this endeavour to bring transparency and hedging facilities to the plastic business. But we must now recognize that these efforts have not attracted sufficient volume of business and the time has come to bring this activity to a close."

After the addition of regional contracts, acknowledging the localized markets for plastics, the LME grew to offer eight plastics futures contracts for polypropylene (PP) and linear low density polyethylene (LL), with one global and three regional contracts for each plastic. The regional contracts are available for Asia, Europe, and North America.

The contracts had gained the most traction in North America, particularly for LLDPE. In the most recent official stock report, which gives an overview of the amount of material currently held on warrant in LME-approved warehouses, while there were only three warrants fro LLDPE in Asia and Europe on April 9, there were 71 for North America. In PP, there were three Asian warrants, eight European, and 31 in North America. By contrast, for its largest market, aluminum, the LME had more than 4 million live warrants as of Oct. 18.