Stocks of non-ferrous metals from Russian Federation on the LME increased 2.5 times

In 2023, the stocks of non-ferrous metals from the Russian Federation on the London Metal Exchange (LME) increased significantly. It is worth noting that traders primarily engage in trading through the LME, while large metallurgical companies typically sell their products to end consumers under long-term contracts. As of the end of 2023, Russian metals accounted for a significant portion of the metals held in the warehouses of the London Stock Exchange. According to recent data, a significant portion of global stocks in the metals market are held in Russian volumes, with 90% of aluminium, 43% of copper, and 31% of nickel stocks being accounted for.

It is worth noting that the stock of aluminium saw a sharp increase, doubling from 169 thousand tonnes to 338 thousand tonnes in December 2023. This sudden jump occurred after the UK implemented a ban on trading in Russian metal for companies and individuals. However, it is important to mention that the LME has received permission from UK authorities to buy warrants on metals. The presence of aluminium in the exchange's warehouses can be attributed to the challenges faced in trading Russian metal due to the weakening global demand for aluminium and traders' anticipation of a key rate cut in the US. Consequently, some of the metal is being held in warehouses.

At present, Russia has encountered difficulties in its traditional markets for aluminium, and working in others has proven to be complex. It has been noted that barrier duties on aluminium from Russia have been imposed by the US, UK, and Australia, while key processors in the EU have also refused to purchase Russian metal. This has led to a redirection of some volumes of non-ferrous metal supplies from Russia to Asian markets. At present, Russia holds a 6% share of the global aluminium market, 17% of the nickel market, and 3% of the copper market.