Aluminum and nickel surged on the London Metal Exchange as traders responded to new US and UK sanctions that banned deliveries of any Russian supplies produced after midnight on Friday.
The new restrictions, aimed at curbing President Vladimir Putin’s ability to fund his military, inject major uncertainties into metals markets that have already been reshaped in the aftermath of Russia’s invasion of Ukraine.
Aluminum jumped as much as 9.4%, the most since the current form of the contract was launched in 1987, while nickel rose as much as 8.8%. That suggests traders believe that removing one of the largest producers from the market will drive prices higher.
The rally is being fueled by “worries that the sanctions will reduce Russian flows to Western markets,” said Jia Zheng, head of trading and research at Shanghai Dongwu Jiuying Investment Management Co. “Any stimulation will be amplified amid an existing bullish backdrop.”
Still, there are also concerns over the prospect of a flood of old Russian metal — which is still permitted — getting dumped onto the LME.
I'm still learning the metals supply chains, so I don't think I have much to say about this, but it is still fascinating.
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looks like Blogger doesn't work with anonymous comments from Chrome browsers at the moment - works in Microsoft Edge, or from Chrome with a Blogger account - sorry! CJ 3/21/20