LME warehousing reform plan not good enough-EU steel lobby
* Eurofer says proposals no help to end-users
* Proposals are LME's 3 attempt in 3 years to solve issue
* Eurofer joins aluminium users in opposing proposals
LONDON, Oct 3 (Reuters) - The EU steel lobby Eurofer has criticized the London Metal Exchange latest proposed changes to its under-fire warehousing system, rebuffing the LME's attempts to soothe irate industrial users.
On July 1 the LME announced sweeping changes aimed at users who say its warehousing policy has led to record high physical premiums and long waiting times to take delivery of metal.
"The current proposal favours metal producers and non-physical users rather than physical end-users," the European steel association Eurofer said.
"Moreover, the 'Load-In Load-Out' proposal will have a limited impact on the market in the short to medium term," Eurofer said in a statement.
In its third effort to resolve the problem in as many years, the LME proposed linking the rate at which a warehouse with big stockpiles and wait times of more than 100 days, is required to load out material to the rate at which it brings in new metal.
Eurofer said the 'load-in load-out' proposal is based on arbitrary factors, which should be re-assessed taking into account three key elements: market conditions, metal requirements of physical users and the specificities of warehousing sites.
The LME asked interested parties to submit comments on its plan by Sept. 30 and a final decision on whether to implement the changes should be made in October.
If approved, the new rules would come into force on April 1 next year.
Aluminium users have already attacked the proposal of the exchange, the world biggest market place for base metals.
European steel producers - big users of base metals such as zinc and nickel - said unfair practices under the LME jeopardise the functioning of the metals market.
In the constribution they submitted on Sep. 30 they urged the LME to take more adequate measures to protect EU consumers from unnecessary costs.
"The LME proposal to reduce queues is a first but insufficient step for solving the systemic flaws of the LME warehousing system," the association director general Gordon Moffat said.
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