Reuters reported that London Metal Exchange has confirmed a new rule to require warehouse companies with 30,000 tonnes or more of one metal scheduled for delivery to deliver out a minimum 500 tonnes per day of other metals stuck behind that queue. The rule will come into effect on April 1 next year.
In some warehouses, outward deliveries of a number of metals are being delayed by an inventory glut in aluminium.
LME Chief Executive Martin Abbott said last month the changes would go some way towards solving problems in the network of warehouses it monitors.
LME rules stipulate a minimum load-out rate for metals stored in the global network of warehouses it monitors. This means warehouses are not obliged to deliver out any more than the minimum.
This, along with financing deals, results in long queues for metal and an artificial tightness in immediate supply, infuriating customers who pay rent to the warehouses while they wait, sometimes for up to a year, to get their goods out.
Source:
http://www.steelguru.com/international_news/LME_confirms_new_warehouse_delivery_rule_to_start_April_1/296353.html
