LME halts flow of Russian metals into its U.S. warehouses

FILE PHOTO: Traders work on the floor of the London Metal Exchange in London, Britain, September 27, 2018. REUTERS/Simon Dawson

LONDON (Reuters) - The London Metal Exchange (LME) said on Tuesday it has suspended the inflow of Russian base metals into its U.S. registered warehouses due to the planned imposition of tariffs on Russian metal by the United States.

The United States said on Friday it would impose a 200% tariff on aluminium and derivatives produced in Russia from March 10, and the LME said it also raised tariffs on other metals.

“For the avoidance of doubt, no further changes are being made to the ability to warrant Russian metal in warehouses outside of the U.S.,” the LME said in a statement.

An LME warrant is an ownership document for metal in LME linked warehouses.

The exchange, the world’s oldest and largest market for industrial metals, said it has suspended immediately the warranting of Russian-origin primary aluminium, copper, lead, nickel or American aluminium alloy (NASAAC).

The action was taken “in order to minimise the risk of price dislocation”, the statement said.

There was very little Russian metal already in U.S. warehouses registered with the LME - only 400 tonnes of NASAAC, which would now not be available to settle NASAAC futures, it added.

The LME is owned by Hong Kong Exchanges and Clearing Ltd..

Reporting by Eric Onstad in London and Swati Verma and Seher Dareen in Bengaluru; Editing by Alexander Smith