The London Metal Exchange stated it will resume trading on nickel on Wednesday after halting last week after metal’s price soared to $100,000 per ton in a huge short squeeze.
- In a notice, it is also bringing in new rules setting daily upper and lower price limits for contracts for nickel and other base metals.
- The exchange was pressured to halt trading last Tuesday and cancel trades after Chinese tycoon Xiang Guangda’s company Tsingshan Holding Group bought significant nickel amounts to cover short positions.
- Tsingshan, the world’s biggest nickel producer, kept purchasing even as the metal’s price jumped to limit further potential losses, driving prices even higher.
- Nickel reached double its Monday closing price of $48,078 lifted by concerns about a supply shock from Russian sanctions.
The extreme volatility pushed the LME to halt nickel trading for the first time since 1988. The trading of nickel will resume at 8 a.m. London time and will adopt regular trading hours from Thursday.