LONDON, Apr 15 (Reuters): Washington and London on Friday prohibited the London Metal Exchange (LME), Chicago Mercantile Exchange (CME) and other global exchanges from accepting new aluminium, copper and nickel produced by Russia.
The two countries also barred the import of the metals into the United States and Britain.
The LME, the world's largest and oldest forum for trading metals, and CME have already complied with the new sanctions. It is unclear if the Shanghai Futures Exchange (SHFE) will follow.
Aluminium, copper and nickel made in Russia on or after April 13, 2024 will not be accepted for delivery to LME-registered warehouses or CME-owned facilities.
Trade of Russian metals outside of the exchanges' system is not restricted by the sanctions.
The sanctions are aimed at minimising Russian export revenue amid Moscow's ongoing war in Ukraine while also reducing the risk of market disruption.
As a result, existing stocks of Russian metal on global exchanges are exempt from the new measures. They can still be traded and withdrawn from warehouses.
This is especially important for the LME as 40 per cent of its available metal stocks are Russian-made. The share of available aluminium stocks of Russian origin in LME-registered warehouses stood at 91 per cent in March, while the proportion of copper stood at 62 per cent. Russian nickel in LME warehouses amounted to 36 per cent of the total.
If an owner of Russian metal can provide evidence that it was produced before April 13, it can still be put on LME warrant - a title document conferring ownership, the LME said.
There are, however, special regimes for the UK for such warrants: the Russian warrants which existed as of April 12 can be cancelled and withdrawn by UK persons. The warrants issued on or after 13 April are subject to restrictions that prevent UK LME members and clients from cancelling or withdrawing the corresponding metal unless they are doing so for the account of a non-UK client.
The CME does not disclose the origin of metal it has in store, but also said aluminium of Russian origin produced prior to April 13 would continue to be eligible for warranting and delivery against its futures contract.
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