LONDON: The London Metal Exchange’s (LME) benchmark nickel contract hit limit down at 8% when it opened on Thursday as traders sold on expectations of falling prices for the metal used to make stainless steel and electric vehicle batteries.
The 8% trading limit based on Wednesday’s close at $45,590 is wider than the previous session’s 5% limit, but still much lower than the 15% for other metals such as copper, aluminium, zinc and lead.
London suspends nickel trade after record spike
Three-month nickel fell to $41,495, the level at which the market can sell on Thursday.
On Wednesday the LME was forced to halt nickel trading on its electronic system within a minute of opening due to a technical glitch and when it resumed in the afternoon there were few trades.
LME nickel trading had been suspended since March 8, a day after sources said China’s Tsingshan Holding Group bought large amounts of nickel, which boosted prices by more than 50% in hours to a record above $100,000 a tonne.
LME nickel prices are used as a reference for deals between end users of the metal and producers, and the disorderly market resumption left some traders questioning whether participants might look for alternative venues.
Nickel prices had been rising steadily even before the conflict in Ukraine ramped prices.
Russia accounts for about 10% of global nickel output and traders have been concerned that supplies could be constrained by Western sanctions on Moscow.
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