LME CEO Suggests Low Possibility to List Rare Earth and Precious Metal

Chief executive officer of London Metal Exchange (LME) Martin Abbott met reporter of Japan Metal Bulletin in Tokyo last week and gave a view it would be difficult for LME to launch new contracts of rare earths and precious metals. Mr. Abbott said LME acknowledges the market shows a high interest in rare earths trade and strong requirement for the price indicator but he pointed out one problem is rare earths are exactly rare in volume and LME cannot establish contracts with enough quantity. He described LME is unwilling to start a new contract due to the very few trading volume. As for precious metals, Mr. Abbott said there have already been many price indicators around the world and it would be unnecessary to provide LME’s new price.

LME’s contract items are regulated to metals presently since the exchange withdrew from plastic contracts in 2011 which was started in 2005. Mr. Abbott told LME wishes to focus on industrial metals when many of its members are specialized in industrial materials. He indicated weak stance to launch new contracts of precious metals. One background is that LME had previously listed silver in 1999 but withdrawn from the all contracts three years later.