The London Metal Exchange has stated its commitment to remain the world's leading metals market, after mining giants announced support for internet-based rivals.

The LME, which was launched in 1877, on Monday reaffirmed its drive to improve technology after four leading metals firms said they are investigating how to harness the web to launch sector-based marketplaces.

The firms revealed they are already planning the launch of what they hope will be the world's first successful coal exchange, which will, through the internet, connect producers and consumers in an $18bn sector.

The LME, which claims a turnover of more than $2,000bn a year in deals, said its own electronic trading system, being developed by Swedish-based OM Gruppen, will be operational early next year.

"We intend to remain number one in the world," an LME spokeswoman told BBC News Online.

Power of the net

Mining firms Anglo American, Billiton, Glencore and Rio Tinto have declined to reveal which markets they are targeting in their joint e-marketplace initiative.

But Leigh Clifford, chief executive of London-based Rio Tinto, said: "Ultimately the way all commodities are sold is going to be influenced by the exciting developments in internet technology."

Anglo American head Tony Trahar said "all stakeholders within the minerals and metals community" would benefit from the marketplaces.

And Brian Gilbertson, chairman and chief executive of Billiton, said: "This vehicle has the potential to raise the metals industry to a new level of commercial efficiency and transparency... by [using] the tools of e-commerce."

Coal exchange

The metals marketplaces will follow the launch by February of Global Coal, an e-exchange for the most liquid area of the coal market.

Global Coal will, by providing an efficient marketplace, allow generators to make cost savings which could result in lower electricity prices, acting chief executive Sean Gilbertson said.

"It will not lead to lower coal prices or indeed higher coal prices," Mr Gilbertson told BBC News Online.

"But where it will bring cost benefits is in allowing consumers to make administration savings. Similarly, producers will be able to save on marketing costs."

Industry backing

While many previous attempts have made to launch a coal exchange, Global Coal believes that the backing of mining firms and consumers including Endesa and Enel improve its viability.

"What you have to have is liquidity, and the involvement of industry, both consumers and producers, encourages that," Mr Gilbertson said.

The LME, while being launched in 1877, traces its history back to the opening of the Royal Exchange in 1571. It trades futures and options contracts in aluminium, aluminium alloy, copper, zinc, tin, nickel, lead and silver.