Last week the LME launched a 3 week discussion process on the possibility of banning Russian metal from the exchange. It could be implemented as early as November. Some say “too little too late”. Others argue that since these metals are not sanctioned, the LME should continue to allow delivery. Of course many consumers and banks have already announced that they will not trade in Russian commodities.
There is a risk that if the LME continues to allow the metal onto the exchange, the warrants will become toxic with no one wanting to hold them. Good for the warehouses perhaps, but not for the overall functioning of the market.
Russia accounts for around 9% of global nickel production, 5% of aluminium and 5% of copper. You could say that it is not that much, but if consumers do shun Russian metals during the annual negotiations for 2023, one option would be for Russian producers to deliver to the LME. If LME do ban them and they cannot deliver, they will have to lean on China and India as the new buyer of last resort.