Top uranium producer Kazakhstan hikes tax
The world’s largest producer of uranium is increasing its mining tax on the nuclear fuel by at least 50% next year.
The trader that last month built up a dominant position in aluminum has begun taking delivery of some metal while rejecting supplies produced in Russia, the latest evidence of a diverging market that is leaving the London Metal Exchange contract increasingly dependent on Russian material.
IXM, a metals trader owned by China’s CMOC Group Ltd., last month built up an unusually large position in the key LME aluminum contract for May delivery. It has started withdrawing some metal from the exchange — largely to deliver to its customers, according to people familiar with the matter, who asked not to be identified as the matter isn’t public.
The trading house has been rejecting Russian aluminum and taking delivery of non-Russian material, as it didn’t have confidence in finding buyers for Russian metal, one of the people said. IXM declined to comment.
The concentration of Russian metal is a fraught question for the LME, which last year faced calls from western producers and traders to ban deliveries of Russian metal but ultimately decided not to. If large volumes of unwanted Russian supplies become stranded on the exchange, there is a risk that the benchmark price could become distorted and trade out of sync with the rest of the market.
While aluminum prices have slid in recent months on worries about the global economy, top traders including IXM and Trafigura Group have been battling for relatively scarce non-Russian stocks amid expectations that the market could rapidly tighten.
On Monday, the LME published updated warehouse data that showed the proportion of Russian-origin metal underpinning the LME’s aluminum contract jumped from 52% at the end of April to 68% at the end of May.
Leading western aluminum producers including Alcoa Corp. have called on the LME to ban Russian metal from its contract, which they say risks distorting prices for the global benchmark contract.
“At some point the only thing left in LME warehouses will be metal that is only consumed by a small group of non-Western producers,” Alcoa Chief Executive Roy Harvey said in April.
The LME on Monday defended its decision to continue allowing Russian aluminum, publishing data showing that 19% of the 167,550 tons of aluminum requested for delivery in May was Russian metal.
“This suggests that Russian aluminum continues to flow through the warehousing network, and that a meaningful set of global consumers continue to accept Russian metal,” the exchange said.
(By Joe Deaux, with assistance from Jack Farchy, Archie Hunter and Mark Burton)
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