LME New Warehousing Rule to Leave Metal Market More Unpredictable – SMM Interviews

SHANGHAI, Feb. 10 (SMM) – The London Metal Exchange (LME) implemented its load-in, load-out (LILO) rule – aimed at reducing the long queues outside its warehouses – February 1. Chinese futures analysts said in a latest SMM interview that the new rule may increase difficulty in predicting metal price movements.

“Responding to the new rule, some LME-registered warehouses would raise the storage charges to offset any impact of the falling queues, while some may turn to non-LME depots,” an analyst from Guosen Futures said. “The resultant increase in invisible inventories will leave it harder to predict the price trends.”

Analyst from Dayou Futures holds that whether the new rule will change the status quo and affect market prices remain to be seen.
 

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