Seriously Telegraph, get a grip:
Chinese accused of manipulating steel market to make a killing on the London Metals Exchange
The allegation is about nickel.
The centre of City metal dealing is facing pressure to launch an investigation into the nickel market after it was rocked by a supply shock last year.
Sources told The Sunday Telegraph the European steel association Eurofer is among those urging the London Metal Exchange (LME) and Financial Conduct Authority to investigate the nickel market after stockpiles plunged late last year, when Indonesia brought forward an export ban on nickel ore.
A particular steel company is alleged to be involved – by dint of having its own nickel mine in Indonesia – but the allegations simply aren’t about manipulation of the steel market.
That’s point 1, that it’s nickel, not steel.
Point 2 is that the LME does have steel contracts, yes. And nickel’s an input into steel, yes. But the nickel price is only a major input into stainless steels. A useful but not conclusive definition of stainless being steel with a high nickel content.
The LME doesn’t run contracts on stainless steel. Manipulating the LME steel market through nickel is unlikely then.
Now, I don’t expect everyone to know this. But I do expect a journalist writing about the metals market to at least research it enough to get it right. More fool me, eh?
It’s not the Sunday Telegraph that’s accusing the Chinese and it’s not the Sunday Telegraph that’s making Eurofer take the matter up with the LME. The paper is reporting a story rather than making one up.
Tim, I see Dominic Lawson quotes you today in his article in the Sunday Times.
Yes, that’s from the CapX piece earlier this week. I lifted it from FT Alphaville, they from VW itself.
“It’s not the Sunday Telegraph”
“The paper is reporting a story rather than making one up.”
Bullshit. They CHOOSE what they print. The byline doesn’t fvcking matter.
Gamecock – so they are making it up, you reckon?
Does having a game cock entail a lame brain?
” But metals trader Malcolm Freeman, of Kingdom Futures, accused steel producers of crying “woe is me, it was fixed” because they “missed the boat”.”
This… The ban on raw ore export seems to have been in place since 2009, but simply hasn’t been enforced up until now. My guess is that is because Indonesia now has the domestic capacity to process the raw ore itself. With , indeed, investment from China.
Nothing stopped any other steel company doing something similar for over a decade, but they probably expected to be able to browbeat Indonesia into relaxing and/or forgetting that ban. Which was stupid, because from what I can read indonesian ore is the easiest to process into nickel, as such in high demand, and as such commercially viable enough for starting up a program of domestic processing to begin with.
That this
hurts the projected commissions and profits ofupsets a bunch of blandjas in London is no skin off their nose, but rather a welcome bonus.Indonesia is in China? When did the country move?
Is there a Post-Indonesia Sea now or a “Stop. Hole Ahead” cordon?
@TMB Thanks for copy