Prices of base non-ferrous metals rose about 5% in early trading in London on February 24 amid increased concerns about cuts in supplies of some metals following news of Russia's invasion of Ukraine.
Russia is a major producer of metals, including aluminum and nickel, as well as a major producer of copper. Market sources believe there is almost certainty that stricter sanctions will be imposed on trade with Russia, which could lead to a further reduction in supplies to world markets, which are already limited and in some cases in short supply.
The three-month LME nickel spot price settled at $25,315/t at 09:38 GMT Feb. 24, compared to a Feb. 23 closing price of $24,396/t.
Three-month LME spot copper traded at $9,954/t at 0938 GMT on February 24, compared to a close of $9,866/t on February 23.
The three-month spot price of aluminum on the LME rose nearly 5% to a record high of $3,450/t.
"The increased volatility due to the escalation of the conflict shows that the markets have not fully appreciated the possibility of a deeper conflict," Mark Häfele, chief investment officer at UBS Global Wealth Management, said of the markets' reaction to the invasion. "We expect continued volatility in the near future."
Gold and palladium
For precious metals, analysts expect gold prices to break the $2,000/troy ounce mark if the conflict escalates further, with prices trading at $1,954/oz early Feb. 24, the highest level in more than a year, as investors actively turn to safe-haven assets.
The price of palladium, which had already gained about 5% on February 23, continued to rise on February 24, reaching almost $2,600 an ounce, its highest level in more than six months.
