RE:RE:I wonder if news has leaked. ....continued....
Rule Changes
The LME initially announced rule changes late Monday in response to a daily spike of as much of 90%, allowing traders to defer delivery obligations on all its main contracts, including nickel -- in an unusual shift for a 145-year-old institution that touts itself as the “market of last resort” for metals.
However, the move failed to address the key driver behind the squeeze -- that market participants with short positions were being forced to close them out because they couldn’t meet margin calls.
Nickel was already rallying on tight supplies even before Russia’s invasion of Ukraine, which has sharpened fears of sweeping commodity shortages. Higher nickel prices, if sustained, threaten to ratchet up costs for electric-vehicle batteries and complicate the energy transition. Russia produces 17% of the world’s top-grade nickel.
A spokesperson for Trafigura, one of the top physical traders of the metal, said it supported the LME’s decision.
Nickel prices were quoted at $80,000 a ton as trading was suspended. Other metals pared or erased gains after the announcement. Aluminum dropped as much as 6.9% to $3,483 a ton, the biggest decline since 2018.