Copper and nickel fall due to investors’ caution due to conflicts between Russia and Ukraine

Copper and nickel prices were lower on Tuesday as trading volumes remained anemic due to investor caution over Russia’s invasion of Ukraine and the heavy weight of nickel shorts.

Nickel at three months in the London Metal Exchange (LME) it was down a marginal 0.5% at $32,560 a tonne by 1022 GMT. Meanwhile, three-month copper fell 0.04% to US$10,335 per ton.

Liquidity on the LME, the world’s oldest and largest metals trading venue, has been tight, especially for nickel, which resumed trading on March 16 after a “short squeeze” – will force its closure, according to operators and analysts.

“Many are taking a ‘wait and see’ stance because of this volatility and low liquidity that started in nickel and has spread to other metals,” said Amelia Fu, chief commodity strategist at Bank of China International.

“The price movements (of base metals) remain focused on the lack of liquidity and the situation in Ukraine,” he said.

The huge volume of short positions in nickel by Chinese group Tsingshan Holding, one of the main producers of the metal, was causing caution among traders, according to analysts.

As for Ukraine, bombing sirens sounded across the country before dawn Tuesday as Ukrainian and Russian negotiators met in Turkey for the first face-to-face talks in nearly three weeks. kyiv seeks a ceasefire without compromising territory or sovereignty.

Sanctions imposed on Moscow have boosted base metal prices on supply concerns, as Russia is one of the top producers of nickel and aluminum in the world.

Meanwhile, Chile’s Codelco, the world’s largest copper producer, is preparing to offer some “non-essential” exploration assets to the market, marking a rare privatization of the state miner, a senior executive said on Monday.