The London Metal Exchange will launch a discussion paper proposing changes to current warehouse rules, including relaxing queue-based rent capping (QBRC) to 80 days, chief executive officer Matthew Chamberlain said.
Speaking to Fastmarkets MB, Chamberlain said the proposals for change have been driven by the warehouses and the paper will be reviewed by the LME warehousing committee before it goes to the market. The discussion paper is set to be released to the market by the end of the first quarter of this year. "Everything has gone through the warehousing committee first. We said to the warehouses: 'If you want to make proposals for change, we will be happy to listen and put them out in a discussion paper and get the market to engage,'" Chamberlain said. As a part of its warehousing reform package, which was published in 2013, the LME launched QBRC in 2016 in an attempt to minimize structural queues forming at LME warehouses. It removed any financial incentive for warehouse owners to allow queues to build up by introducing reduced rent after 30 days and free...