[ferro-alloys.com]The London Metal Exchange plans to restart warranting of Rusal's aluminum in January after its Special Committee meeting, exchange spokeswoman Bianca Blake said Friday.
The London Metal Exchange issued a notice to members Thursday proposing to restart warranting of aluminum produced by Russian producer Rusal, which has been under US sanctions since April 6. LME has also called on its members to express views by December 28.
Blake said the Special Committee, which has been delegated emergency decision-making capability by the LME Board, will meet as soon as possible after December 28.
"The LME notes the December 19 notification by the US Department of the Treasury to the US Congress regarding the proposed lifting of certain Russia-related sanctions imposed on April 6, which involved the designation of Rusal and its owner, En+ Group plc as Specially Designated Nationals," the LME said.
"In the event that Office of Foreign Assets Controls (OFAC) removes Rusal and EN+ from the SDN list and thereby lifts the sanctions, the LME proposes recommending to the Special Committee that it lift the temporary conditional suspension so that warranting may be resumed in respect of all Rusal metal."
LME aims to implement the Rusal metal warranting in time with the OFAC sanction lifting on January 21, Blake said.
LME proposes to resume warranting of all Rusal aluminum produced prior to April 6, between April 6 to the date the sanctions were lifted, and after the lifting of the sanctions.
A source at an LME member company said he was not expecting any objections by other members on the exchange proposal.
Some market participants said after the OFAC lifts the sanctions and LME restarts Rusal metal warranting, aluminum stocks at LME warehouses will increase.
Some sources added impacts of sanction termination have already been factored in. The LME price move after the December 19 OFAC announcement to possibly lift the sanctions was marginal, and the restart of the Rusal metal warranting has already been priced in, said the LME member source.
(S&P Global Platts)