There has been no let up in the strong upward trend in LME nickel prices. On August 16~(th), the daily official LME 3-month price achieved a fresh nominal peak of 27,750 dollars/t and the cash to 3-month backwardation flared out to a massive 5,650 dollars/t. Under such extreme conditions, the LME Special Committee has intervened in the market and limited the backwardation to 300 dollars/t per day. Until further notice, anyone that is holding a short position, which is due to become prompt on or after August 18~(th) and cannot deliver metal or borrow at a backwardation of 300 dollars/t, will be allowed to defer delivery for a day at a penalty of 300 dollars/t. Those with long positions who are subject to deferred delivery will be entitled to 300 dollars/t per day compensation. The LME has also suspended the Lending Guidance so that those with large long positions will not be obliged to lend in accordance with the Guidance.
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