LME rule change won’t hit US premiums: Alcoa
Jul 09, 2013 | 03:16 PM
| Michael Cowden
CHICAGO Alcoa Inc.s top executive downplayed the potential impact of proposed changes to load-out policies at London Metal Exchange warehouses and any possible downward effects they might have on regional premiums.
The LMEs proposed rules wont apply before 2014 and address a problem that Alcoa chairman and chief executive officer Klaus Kleinfeld questioned the necessity of resolving.
"When you look at these so-called inventories that are stuck in the LME, we are really only referring to the canceled warrants," he said.
Canceled warrants account for only about 2 million tonnes of total stocks both in LME warehouses and those stored elsewhere, or "inventories visible and invisible" of approximately 10 million tonnes, Kleinfeld said. "The rest of the metal is moving about freely. I also believe that probably the majority of the metal that is getting canceled is ... going to lower cost off-warrant storage."....
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