Then on March 7, nickels price began its parabolic ascent, surging from US$30,000 a ton to more than US$50,000. Many traders expect the price to return to more normal levels once the margin call chaos has been resolved. The price was frozen, below the record high but still at US$80,000 a ton. As for the nickel market itself, prices remain elevated compared to before the short squeeze, possibly reflecting the persistence of Western sanctions on Russia. Trading and mining giant Glencore was the dominant holder of nickel in recent months, according to people familiar with the matter. Tsingshan, the world's largest stainless steel producer, is rumoured to have built a big short position in nickel before a 250% rally in [] But since last year, Tsingshan has also started to produce a source of nickel for batteries. Crucially, the decision meant traders wouldnt need to pay margin calls on the basis of the US$80,000 nickel price. And once again, this short squeeze racked up billions in losses for those involved. Plus, 60% off clearance with American Eagle promo code, Wayfair promo code: 10% off any single purchase, Kohl's promo code: 30% off for Kohl's Rewards Members, 50% off + free delivery on any order with DoorDash promo code. The LME nickel short squeeze. One of Tsingshans brokers, CCBI Global Markets, also failed to pay hundreds of millions of dollars in margin calls on its nickel positions on March 7. Following Tsingshan's statement announced March 15, the LME said that all nickel contracts will resume trading at 0800 London time on March 16. The broker was able to settle the margin calls on Tuesday after several clients, including Tsingshan, got loans to cover their positions, one of the people said. Credit: INF News.com Massive short positions held by Xiang's Tsingshan Holding Group, the world's largest . It had sold nickel forward on the markets, betting on the price going down, not up. As the market was picking up on the short squeeze of Tsingshan, the LME had decided to intervene. A record-breaking rally in nickel prices that led the London Metal Exchange to halt trading on Tuesday is putting increased pressure on the Chinese stainless steel producer Tsingshan and its billionaire co-founder. Tsingshan, who pioneered the Rotary Kiln Electric Furnace (RKEF) process to produce low-cost nickel pig iron (NPI), is now the dominant player in the Indonesian NPI industry and a global leader in NPI processing technology, including having implemented the Argon Oxygen Decarburisation process which incorporates the direct hot charging of NPI into the stainless steel production process for a . The price moves exacerbated the pressure on holders of big short positions, already facing calls to deposit extra funds with brokers, a practice known in financial markets as margin calls. For non-personal use or to order multiple copies, please contact The London nickel market has been closed since last Tuesday morning, when the exchange intervened after prices spiked as much as 250% in two days, and the standstill announced by Xiangs Tsingshan Group Holding Co. could provide the certainty needed to restart trading. The Morowali park mainly produces nickel pig iron for stainless steel. But when the price rises instead of falls, the traders losses pile up, and given that prices can keep surging higher indefinitely, theres no limit to how substantial those losses can become. Tsingshan was unable meet margin calls and only avoided bankruptcy after . This weeks spike in prices has played out principally on the LME, and many traders expect the price to return to more normal levels once the margin call chaos has been resolved. He was awakened by a phone call at 5:30 a.m. Xiangs short position has now racked upbillions of dollars in losses. He started increasing his short position on the London Metal Exchange. Prices of oil, gas, wheat and a range of metals, including aluminium and palladium, have soared since the invasion, ramping up costs for companies and consumers and threatening the nascent recovery from the coronavirus pandemic. But its extremely unusual for an exchange to cancel whole sessions of trading after the fact. Nickel is a non-ferrous metal, and the fifth most common element found on Earth. Short-covering trades made last week by the Chinese billionaire contributed to a swift, huge surge. Given that JPMorgan was reported as the biggest trading counterparty against which Tsingshans nickel trades were made, the US bank led the subsequent agreement to arrange a rescue credit facility, secured from various lenders, including China Construction Bank (CCB), to help the Chinese nickel giant address its immediate liquidity squeeze. Nickel short interest was created by Tsingshan. Founded back in 1877 and now owned by Hong Kong Exchanges & Clearing (HKEX), the LME performs a critical role in determining benchmark prices for the global metals industry and provides a liquid market venue for financial institutions to make money. Xiang Guangda in 2017. Assessing the Incremental Costs of Regulation and Supervision Faced by Next-Gen Operating Models for Bankers and Advisors, Macroprudential Policy and Real Estate Funds. CCBI Global Markets is another creditor, two separate sources said. Short-covering trades made last week by the Chinese billionaire contributed to a swift, huge surge. By April, nickel prices began to fall below $35,000/tonne and Tsingshan began to close its short positions and settled its margin calls. Is the US Finally Warming to the Possibility of Creating a CBDC? The 145-year-old home of global metals trading has been heavily criticized by investors for its response to the crisis. That would come on top of any losses incurred by the tycoon since he began building the short position late last year through closely held Tsingshan. Today, Tsingshan is the biggest nickel producer in the world, accounting for around 20% of the global market. A consortium of hedge bank creditors that has a standstill agreement with Tsingshan agreed not to close out the positions against the company or to make further margin calls on the existing positions. The simple fact here is that we did not have visibility over the size of the risk, Matthew Chamberlain, the LMEs chief executive, also stated. The war in Ukraine surprised the market and led to a price surge, pushing Tsingshans margin to billions as it rose in-line with nickel prices. LONDON (Reuters) -- China's Tsingshan Holding Group has reached an agreement with banks under which they will not make margin calls on or close out the producer's nickel positions on the London . Effectively, it rewound the market to the moment when prices closed on Monday at US$48,078. The super spike was driven by holders of short positions, including Tsingshan and its brokers, rushing to close them out. Tsingshan has been finding it difficult to pay margin calls to its creditors, the report said. A Glencore spokesman declined to comment. The LME announced on Friday it was raising margin requirements for nickel contracts by 12.5% to $2,250 a tonne. Some think this could herald the end of the exchange itself. Xiang shrugged off suggestions to reduce short positions, Tsingshans nickel short position stood at about 150,000 tons. On 15 March, Tsingshan reached an agreement with a consortium of hedge bank creditors on a standstill arrangement, with provision for the existing hedge positions to be reduced by the Tsingshan group in a fair and orderly manner as abnormal market conditions subside. Capital Com is an execution-only service provider. On this day, however, metal traders across the city were glued to a screen, watching the price action on the electronic market, which was already open to accommodate Asian trading. The London nickel market has been closed since last Tuesday morning, when the exchange intervened after prices spiked as much as 250% in two days, and the standstill announced by Xiang's. Margin call ini membuat harga nikel meledak dan menembus US$ 100 ribu per ton dari hanya US$ 25 ribu per ton. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. Bloomberg: Balance of Power focuses on the politics and policies being shaped by the agenda of President Biden's administration. The giant commodity trader Glencore Plc also had a position on the LME that would benefit from rising prices. The frenzied move the largest-ever on the LME came as investors and industrial users who had sold the metal scrambled to buy the contracts back after prices initially rallied on concerns . Following Russias invasion of Ukraine on 24 February, the three-month nickel contract rocketed to more than $100,000/tonne on 8 March, hitting an intra-day high at $101,365 on the same day. The Chinese government may also play a role. Tsingshan is also a nickel miner and operates nickel pig iron mines and production facilities. 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Nickel prices had been rising for weeks amid fears of disruptions to supplies from Russia. Just over a year after the historic short squeeze involving video-game retailer GameStop sent shockwaves around the financial world, a similar episode broke out in early March, this time on the London Metal Exchanges (LME) nickel market. Matthew Chamberlain speaks on "Bloomberg Markets: Europe.". It also doesn't create waste and may help fight the climate crisis. He draws a comparison with Silver Thursday, the day in 1980 when an attempt bythe Hunt brothersto corner the silver market came unstuck. But nothing could prepare the market for what was about to follow, with the Russia-Ukraine conflict sending prices skywards on global supply concerns. This copy is for your personal, non-commercial use only. Real Estate Funds a tonne bythe Hunt brothersto corner the Silver market came.. 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