The London Metal Exchange’s (LME) iconic “Ring trading” floor will remain shut for six more months, it was revealed today, raising the prospect of its permanent closure.
Since the 1800s, traders at the LME have shouted buy and sell orders for metals while seated around a red curricular sofa but the days of one of Europe’s last open-outcry trading floors could be numbered.
Speaking to a virtual webinar today, chief exec Matthew Chamberlain said that the floor would be shut until the new year.
He reaffirmed his commitment to reopening the Ring, but admitted that it was unlikely this would happen soon due to the surge in coronavirus cases, Bloomberg first reported.
In the meantime, the bourse will set up a body to look into ways to improve its electronic trading and the way that the exchange currently conducts its trades.
The world’s oldest market for industrial metals has set three criteria for reopening the ring, including the end of social distancing in the UK and the broad rollout of a vaccine for the disease.
A spokesperson for the London Metal Exchange said: “Given that social distancing measures in respect of Covid-19 are likely to be in place for at least the next six months, the LME is forming a working group, made up of user committee representatives, to help to plan and prepare for the prolonged suspension of Ring trading.
“The group will consider whether it is helpful to set a date before which the Ring will not reopen, whether enhancements could be made to the LME’s electronic pricing mechanism to ensure it is working as effectively as possible – particularly in respect of the Closing Price forward curve, and finally whether any longer-term re-balancing of the LME’s pricing and trading set-up would be helpful or desirable.
“Outcomes from the working group will be communicated to the market for broader consideration in due course”, they added.