21 March 2022 – The exploded nickel prices after the failed Tsingshan speculation continue to be artificially adjusted. On Monday, the LME and SHFE almost reached parity in the price of a tonne of nickel. LME shareholders affected? LME CEO sees banks as partly to blame. Export ban: Russia loses about 25% of its alumina (aluminium oxide) imports. And one of Europe’s largest steelworks is in ruins.
Nickel: LME and SHFE are becoming more and more similar
Already on Friday we wrote that nickel prices on the London Metal Exchange (LME) are being artificially adjusted downwards. As expected, nickel prices reacted today, Monday, and were again adjusted downwards by 15% and are currently at approx. $ 31,380 per tonne (LMEselect 3 Month, prices without guarantee).
Nickel prices artificially adjusted(?)
Nickel prices on the SHFE also fell evenly. And are now roughly where they were on 7 March 2022 – the day the Tsingshan Holding Group speculation got out of hand. This should almost achieve the obvious goal of the originators to bring nickel prices back to the point in time before the incident. And it also explains why the nickel price, after closing at $42,200 on 7 March, was raised to around $48,000 for several days and held there.
LME sees banks as partly to blame
Outgoing LME Chief Executive Officer Matthew Chamberlain said in an interview that banks had lobbied against stricter rules and more transparency in metals trading. He did not mention whether this meant the banks that hold large stakes in the London Metal Exchange and the Hong Kong Exchange – but as CEO he should know.
Australia bans alumina exports to Russia
Russia has lost one of its most important alumina (aluminium oxide) suppliers. In response to the conflict in Ukraine, Australia has banned alumina exports to Russia. This means that Russia will lose about 25% (2019) of its alumina imports. Russia is one of the largest aluminium producers in the world. Until now, the European Union had explicitly refrained from banning imports of raw materials from Russia in its sanctions. With this move by the Australian government, however, the supply of Russian aluminium is likely to decrease further.
Aluminium prices rise
Aluminium prices continued their upward trend at the start of the week. On the Chinese SHFE, aluminium went up by more than 2.2%. On the European LME, aluminium started trading at over $3,500 per tonne, up about 3.8%.
Ukrainian steelworks destroyed
One of Europe’s largest steel plants, Azovstal in the Ukrainian city of Mariupol, was severely damaged or even destroyed by Russian troops, according to Ukrainian sources. The steel plant, which belongs to the Metinvest Group, said it had already shut down blast furnaces and coking plants at the beginning of the conflict to minimise any possible impact on the civilian population in case of an emergency. Azovstal has a total capacity of more than 6 million tonnes of crude steel per year.
- Nickel manipulation and rising stainless steel prices
- New EU anti-subsidy duties on stainless steel clearly a political decision
- Steel sanctions, nickel and US interest rate hike
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