LONDON (Bloomberg) — MF Global Ltd., the Bermuda-based derivatives broker, is starting a nuclear fuel trading desk in London, at least the third effort in the past 18 months by brokers and exchanges to make uranium more tradable.

MF Global hired Scott Lawrence, formerly the head of nuclear fuel markets at Tullett Prebon Plc, to lead the desk, the company said yesterday in a statement. Uranium is the fuel used to generate electricity at nuclear reactors.

The company will offer trading in physical uranium oxides together with uranium price hedging products, it said.

MF Global's initiative follows Tullet Prebon which opened its desk in March last year and the New York Mercantile Exchange which launched uranium futures contracts in May 2007.

A quarter of clients will be nuclear utilities, and the rest current producers, companies that plan to start production in the "near term," brokers, and investors, Lawrence said yesterday in a telephone interview from London.

"We stand as an independent intermediary" with a global operation, he said.

MF Global will trade financial contracts with delivery of at least 10,000 pounds of uranium oxide equivalent, Lawrence said. The contract size may rise to 50,000 pounds in size, he said, depending on the market reaction. Nymex currently trades futures contracts of 250 pounds of uranium.

Lawrence, who started at MF Global this week, worked on new product development and later nuclear fuel trading at Tullett Prebon since 2005.

¿ Citadel Investment Group LLC, the asset-management firm founded by Kenneth Griffin, increased its stake in MF Global Ltd. to 5.3 percent after shares of the derivatives brokerage tumbled to a record low.

Citadel held 6.64 million shares in MF Global, according to a filing yesterday with the US Securities and Exchange Commission. Citadel, based in Chicago, held 341,570 shares, or a 0.3 percent stake, as of June 30, filings show.

MF Global last month fell to the lowest level on the New York Stock Exchange since its debut in July 2007 on concern the company was unable to finance operations and tighten risk controls after a loss from unauthorised wheat-futures trades. The stock has lost 78 percent this year.

Citadel, which Mr. Griffin started 18 years ago, oversees more than $20 billion and trades everything from equities to energy contracts to weather futures. It also makes markets in stocks and equity options and invests in other hedge funds.