Stocks of Russian metal are building up on the London Metal Exchange, as some consumers shun Russian raw materials such as copper and nickel.
At the end of January, 94 per cent of copper in LME warehouses was Russian, up from 58 per cent in late October, according to the report released Thursday evening — approaching the highest levels in a decade.
The LME, which last year consulted its members over whether to ban Russian metal from entering its warehouses, said the rising levels of Russian metal had not yet reached a point where it needed to take action.
Russia is a major producer of metals such as nickel, aluminium and copper. While Russian metals have not officially been placed under any Western sanctions, some consumers are “self-sanctioning”, or refusing to use Russian metal, which reduces demand for materials of Russian origin.
The data marks the first in a series of regular monthly reports by the LME on the level of Russian stocks in its warehouses, which it introduced after last year’s discussion with members.
“The proportions of Russian stocks have risen. However, across the LME’s main contracts, these levels remain at or below their historical highs,” the exchange said in a statement.
By the end of January the proportion of Russian stocks rose to 41 per cent for primary aluminium and 15.8 per cent for nickel, according to the report. However the proportion of Russian stocks for aluminium alloy declined, reaching 8 per cent.
The LME said that market participants do continue to withdraw Russian metals from its warehouses, indicating continued demand for the material.