LME to add warehouse in Hong Kong

The London Metal Exchange (LME) has approved Hong Kong as an LME warehouse location, and if the organization can find an operator, Hong Kong will join the LME’s existing network of 32 locations in North America, Europe and Asia.

“The addition of Hong Kong to our global warehousing network is an exciting development, providing warehouse facilities closer to the metals hubs of mainland China than ever before,” says Matthew Chamberlain, CEO of the LME. “Mainland China is the world’s largest consumer of metals, and with its outstanding commercial infrastructure, Hong Kong provides the natural hub for connectivity to the Chinese market that is so important to market participants and the wider metals industry.

“We have had significant interest from warehouses, landlords and metal owners in the listing of Hong Kong as a metals delivery point and we look forward to being able to announce the first LME warehouse listing."

The LME considers approvals for warehouse locations with the objective of “securing a widespread network around the world in the most important areas of net consumption.” Locations are assessed considering variety of factors, including local fiscal and regulatory systems and access to a good transport network, according to the LME.

Hong Kong will be permitted to store LME-registered aluminum alloy, primary aluminum, copper, lead, nickel, tin and zinc, according to the exchange, and it will become an “active” warehouse location three months after its approval of the first warehouse operations company.

There currently are more than 465 of LME-approved warehouses in 32 locations worldwide. The exchange does not own or operate warehouses, but instead authorizes warehouse companies to store LME-registered brands of metal on behalf of warrant holders, or metals owners.