Column: LME stays Russian metal ban with views starkly split – by Andy Home (Reuters – November 15, 2022)

LONDON, Nov 15 (Reuters) – The London Metal Exchange (LME) has announced it will continue accepting Russian metal as good delivery against its industrial metal contracts, for now at least.

It made the decision knowing “it is likely that additional tonnages of Russian metal will – in time, if not immediately – be warranted in the LME physical network.” That brings with it the risk of LME pricing moving from a global to a Russian benchmark, creating a disconnect between paper and physical markets.

Absent formal government sanctions against Russian aluminium, copper and nickel, everything depends on how many players choose not to take Russian metal in their 2023 supply contracts.

Many will self-sanction. But many won’t. The LME’s discussion paper on the acceptability of Russian metal has revealed just how split the global industry is on the question right now. The stark divisions leave the exchange with little option but to take a wait-and-see approach.

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