The global raw material market fluctuated sharply due to Russia’s invasion of Ukraine. After the London Metal Exchange (LME) frantically squeezed and suspended trading for a week, it was hoped that the global nickel market would be back on track after trading resumed, but it backfired. After the resumption of trading on the 16th, the nickel price immediately hit the lower limit and stopped again due to a “technical problem”. “Reuters” described the transaction as chaotic, which greatly damaged the reputation of the LME. The LME also announced that the price of the nickel market on the 17th was relaxed to 8%. .
After the short-squeezing of nickel market futures trading, the LME recently announced the resumption of nickel metal trading on the 16th and set a 5% increase and decrease, but the “Wall Street Journal” reported that when trading resumed at 8 a.m. local time, nickel prices fell sharply, falling to $45,590 per ton. Immediately, the 5% price limit, which prevents sharp price fluctuations, is touched.
The LME later said that due to a “system error”, the electronic trading platform still allowed “small trades” to keep the market below the limit. However, the LME soon stated that it had decided to suspend electronic trading due to “technical problems”. After investigating the problem and re-trading on the afternoon of the 16th, the trading volume almost froze.
Traders may start to consider moving away from the LME
“Reuters” described the reopening of the LME nickel metal market as chaotic. The reopening of chaos has put more pressure on the LME. As nickel prices soared wildly last week, existing investors faced losses of billions of dollars, and the LME’s subsequent suspension of trading attracted a lot of criticism. The disorder began to make some traders doubt whether Possibly look for alternative exchanges.
A metal trader said bluntly: “The transaction is really messed up, it’s embarrassing, and even disorder is not enough to describe.” Another metal trader said: “People are starting to think about staying away from the LME.”
After the restart of trading was thrown into chaos, the LME announced the cancellation of trading below the limit line, but other transactions were not affected. At the same time, the LME also announced that on the 17th, it would expand the price limit of nickel to 8%, and added that it may further adjust the price limit of nickel and other metals according to market conditions.