LME Puts a Stop on Russian and Belarusian Nickel Warehousing

The London Metal Exchange (LME) just introduced a ban on nickel with Russian and Belarusian origins. This adds to the long list of Russian sanctions currently imposed by the UK and other NATO nations.

The ban will take effect immediately in approved warehouses located within the United Kingdom. This comes not long after the UK government imposed a 35% import duty on all base metals from Russian and Belarus.

The move actually came about on April 1st, 2022, and encompassed other Russian metals such as lead, copper and aluminum. Only Russian nickel exported before July 20 was exempt form the ban.

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Russian Sanctions: Effected UK Regions

The LME had this to say on the matter: “It should be noted that there is currently no nickel in LME-listed warehouses in the UK produced by the entities listed in appendix 1, and therefore the existing nickel on warrant will not be impacted by the regulations. Further, the LME does not list any nickel which is produced in Belarus,”

The bourse’s approved warehouses in the United Kingdom are in the port cities of Hull and Liverpool.

It was not immediately clear exactly when the UK government added nickel to its list of sanctioned metals from Russia.

Platinum and Palladium Duty Imposed

Norilsk Nickel, one of the largest suppliers of nickel to Europe also faced sanctions. MetalMiner reported previously that the Russian palladium and nickel smelting and mining corporation had sanctions imposed on its president Vladimir Potanin. This move came in hopes of increasing economic strain on Russia in light of the country’s unprovoked war on Ukraine.

Along with this, the UK government imposed a 35% duty on platinum and palladium imports from Russia via Norilsk Nickel and the Russian Platinum group.

While this ban would obviously impact nickel stocks in warehouses, increased nickel production in Indonesia plus uncertainty over China’s rate of economic growth make it unlikely that this move will have any real bearing on nickel prices, one analyst stated.

The bourse’s three-month, official price for nickel was $21,781 per metric ton on Aug. 18, down 7.81% from $23,626 on Aug. 10.

Nickel stocks in LME-approved warehouses also totaled 56,010 metric tons as of Aug. 18, down 3.4% from 57,978 metric tons on Aug. 1, and by almost 45% from 101,256 metric tons on Jan. 4, data from German trading company Westmetall showed.

The LME Nickel contract remains one of the highest grades, which is not at all connected with battery production for electric vehicles, sources also told MetalMiner.

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