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LME ring trading to return after outcry

The London Metal Exchange will reopen its in-person trading ring after receiving 192 responses to a proposed restructure.
LME ring trading to return after outcry LME ring trading to return after outcry LME ring trading to return after outcry LME ring trading to return after outcry LME ring trading to return after outcry

The LME is poised to reopen its in-person trading ring in September

Ngaire McDiarmid

Reporter

The open outcry trading floor was suspended in March 2020 due to COVID-19 and the HKEX-owned exchange had proposed earlier this year to remain fully with electronic pricing.

The LME has now determined to reopen the ring on September 6, to allow time for vaccine efficacy.

The ring had set benchmark prices for metals including copper during "highly liquid" five-minute sessions.

The LME said the ring would resume discovery of the lunchtime official prices but closing prices would continue to be determined electronically.

"The divergent views in response to the discussion paper were particularly apparent between traditional participants and some smaller physical clients on the one hand, and our larger merchant trader and financial participants on the other," LME CEO Matthew Chamberlain said.

"However, respondents were constructive in proposing approaches to reconcile these differences, respecting the differing needs of the LME community, and preserving the unique and mutually beneficial blend of physical and financial market liquidity, which makes our market so special."

Traders are still required to follow a strict dress code but another change in recent years was a 2019 ban on daytime drinking, local media reported.

There are currently nine members with the right to trade LME contracts by open outcry in the ring.

It is one of the few remaining open outcry trading floors in the world.

The New York Stock Exchange eased trading floor restrictions in May, allowing more people back into the pit on Wall Street, however the same month the CME Group said it would permanently close its open outcry trading pits which had been shut in March 2020.