Nickel trading will remain suspended on the London Metal Exchange (LME) on March 11, as the criteria for resuming trading that were previously established have not been met, the LME said in a March 10 update.
LME Suspends Nickel Trading Amid Record Surge
The London Metal Exchange (LME) suspended nickel trading on March 8 after prices more than doubled overnight, soaring past $100,000/mt and peaking at an all-time high of $101,365/mt in early trading. The prior day, nickel had closed at $48,078/mt.
The LME cited the need to implement “operational procedures to achieve a safe reopening” and to assess the “possibility of netting-off long and short positions” as prerequisites for resuming trade. In a March 10 update, the exchange said, “One of these criteria has not yet been achieved, therefore, the nickel market will not reopen tomorrow. But the LME is doing all it can to reopen the market as safely and quickly as it can.”
Once these conditions are met, the LME will issue a formal notification of the reopening date. The exchange also noted ongoing discussions on operational safeguards, including the introduction of price bands, not just for nickel but also for all physically deliverable contracts. A notice on price bands will be released “as soon as practicable,” though no earlier than March 11.
As for netting off long and short positions, the LME reported limited initial interest, especially from short position holders, citing significant disagreement over acceptable pricing levels. Talks with the market participants on this issue are continuing, the LME said.
Until nickel deliveries restart, delivery positions will roll forward to the first settlement business day after the official resumption date.
In response to market concerns, the LME said it had received inquiries about whether it had opened a formal investigation into the nickel market. While declining to confirm or deny any ongoing investigations, the exchange stated that it is actively monitoring for “unusual or suspicious trading activity.”
“The LME has wide-ranging power of information gathering (including about OTC trades), investigation and enforcement under its rulebook, and will exercise these powers as appropriate where such activity is identified,” it said.
Meanwhile, the European Steel Association (Eurofer) urged the LME and the UK's Financial Conduct Authority on March 9 to intervene against what it called “massive” and “artificial” fluctuations in nickel pricing. Nickel is a critical input for stainless steel and battery manufacturing, including for electric vehicles.
