A Nickel for Your Ukraine Thoughts – by the Editorial Board (Wall Street Journal – March 8, 2022)


Wars rarely go as planned and they invariably have collateral economic damage that surprises the unsuspecting. That’s the story this week in the chaos in the market for nickel, a crucial metal used in electric-vehicle batteries, among other things.

The London Metal Exchange on Tuesday suspended trading in nickel, after the price soared 66% on Monday to more than $100,000 a metric ton. This was the first time the LME suspended trading in a metal since the international tin cartel collapsed in 1985.

Russia is a major nickel producer, and traders are concerned about shortages in the metal from U.S. and European sanctions. Short-traders covering their positions also sent prices higher.

Inevitably, such sharp price moves will catch some traders and companies on the wrong side of trades. One of the trampled appears to be Tsingshan Holding Group, a giant Chinese nickel producer. Chinese media reported Tuesday that Tsingshan had paper losses of $8 billion on its nickel contracts.

For the rest of this editorial: https://www.wsj.com/articles/a-nickel-for-your-ukraine-thoughts-russia-metals-market-climate-11646781149articles/a-nickel-for-your-ukraine-thoughts-russia-metals-market-climate-11646781149