Vitol Moves to Reduce Storage Costs by Withdrawing Aluminium from LME Warehouses in Malaysia
January 9th
Energy and commodities trading giant Vitol plans to significantly lower its warehousing expenses by withdrawing large quantities of aluminium from London Metal Exchange (LME)-registered facilities in Port Klang, Malaysia. Sources say LME-approved warehouses in Port Klang impose a storage fee of $0.56 per metric ton—about five times higher than non-LME warehouses. Leveraging LME’s queue-based rent capping (QBRC) rule, which halts storage fees 80 days after a delivery notice, Vitol increased cancelled warrants by over 40,000 tonnes in early January 2025, suggesting they intend to take delivery of the metal—potentially to meet future contractual obligations. This stock removal also nudged benchmark aluminium prices higher, underscoring the metal’s critical role in sectors like transport, construction, and packaging.
