“Following detailed discussions with our ring-dealing members and User Committee, and having fully assessed the updated UK government guidance that came into effect on 4 July, our position remains not to reopen the ring until such a time as it would be consistent with the government’s social distancing guidance,” the LME said.
The open outcry trading floor closed and the LME moved to electronic price discovery on Monday March 23 following the Covid-19 outbreak.
In the week prior to its closure, the LME ring had been operating from its disaster recovery site in Essex.
“While it remains challenging to provide certainty on a timeline for reopening due to our reliance on government guidance, we will be providing a roadmap to our members and the wider market regarding the specific criteria for reopening the ring, which will be communicated in due course,” the LME added.
“We will also continue to actively assess our options as the guidelines evolve, while prioritizing the health and safety of our staff, of our ring members’ staff, and ensuring that we minimize infection rates for the benefit of society.”
There are nine LME Category 1 members with exclusive right to trade LME contracts by open outcry in the ring as well as in the telephone market and on the exchange’s electronic trading system, LMEselect.
In May, LME chief executive officer Matthew Chamberlain said the exchange would take a conservative approach to reopening the ring, and he was happy with the effectiveness of the current electronic pricing model.
(In the seventh paragraph of this story, the story stated there are 11 LME Category 1 members. There are in fact nine. This has been corrected.)
The London Metal Exchange will keep its open outcry trading ring in London closed despite the United Kingdom easing its lockdown restrictions, it announced on Wednesday July 8.