LME stops nickel trade due to Ukraine war

The London Metal Exchange has temporarily cancelled the trade in nickel after the price of the metal doubled in the growing market turbulence caused by the Russia-Ukraine war.

‘The LME has determined that it is appropriate in the circumstances to cancel all trades executed on or after 00:00 UK time on 8 March 2022 in the inter-office market and on LME select until further notice, and defer delivery of all physically settled nickel contracts due for delivery on 9 March 2022,’ it was stated.

The LME has also ‘temporarily’ ceased publishing official prices and closing prices for nickel contracts for the duration of the trading suspension. It is suggested the pause could last several days. The metal is crucial for making stainless steel and electric vehicle batteries.

With prices topping US$ 100 000 per tonne, reports suggested one reason was short covering by a leading producer, China’s Tsingshang Holding Group. Neither the company nor the LME has commented on the suggestion.

The LME has been monitoring the impact on the LME market of the situation in Russia and the Ukraine, as well as the recent low-stock environment and high pricing volatility environment observed in various LME base metals and in particular nickel.

The LME has created a page on its website summarising how known sanctions and tensions regarding the Russia-Ukraine war may impact global metal markets. Detailed statements of the nickel trading suspension are also on its website.