The London Metal Exchange discovers irregularities in nickel contracts

The reopening of nickel trading during Asian trading hours by the London Metal Exchange (LME) has been postponed due to the discovery of irregularities in nine nickel contracts.

These nine contracts, which represent 0.14% of the LME’s live nickel warrants, have been invalidated and cannot be delivered against LME contracts.

The LME’s nickel market will now reopen during Asian trading hours on March 27, one week later than originally scheduled.

Jamie Turner, the interim chief operating officer of the LME, stated that although the exchange is confident that any direct impact on its traded contracts has been removed by invalidating the affected warrants, the exchange recognizes that participants may want to conduct their own stock checks.

To minimize any potential impact on trading behaviour, the LME prefers such actions to occur during London hours when liquidity is generally stronger.

Last year, the LME introduced restrictions on nickel trading during Asian trading hours due to spiking nickel prices and fears of shortages caused by sanctions against major producer Russia, which triggered a short squeeze. The return to Asian trading hours is expected to boost the nickel market, which has struggled to recover from the crisis of the previous year.

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