HOTTER ON METALS: Shining a light on warehouse cancellations

The London Metal Exchange will on February 1 introduce a reporting process that will increase transparency into levels of off-warrant stocks.

The exchange announced the plans in November 2019 and aims to attract more metal back in LME sheds.
It is controversial, but its passage into the LME rulebook on February 1 follows a consultation last year.
Some market participants are now saying the LME should consider going a step further and publish data on an anonymized basis showing where metal goes when it leaves a warehouse.
If that sounds even more contentious than publishing off-warrant stocks, that is because it probably is.

But the argument being made is that a significant portion of the material that exits storage simply moves to another warehouse in the same location for cheaper rent; it doesn’t go to a consumer, nor is it part of a physical...


Andrea Hotter

January 15, 2020

17:31 GMT

New York