Price of canned goods may rise in the UK as the London Metal Exchange (LME) on Friday (4) raised its margin requirements for aluminium and nickel contracts effective at close of business on March 8 after a rally fueled by the escalating Russia-Ukraine conflict.
According to the head of LME Matthew Chamberlain, the rising cost is expected to be passed on to consumers through drink cans.
Russia is one of the world's biggest exporters of key raw materials such as aluminium and nickel traded on the LME. The possible exclusion of supplies from the country due to sanctions has sent traders and importers into a frenzy.
Aluminium prices hit a record £2,936 a tonne on Friday (4), a 17 percent rise since Feb. 23, while nickel touched a near 14-year peak of £23,001 a tonne, climbing 24 percent since Feb. 23.
Copper prices have hit a five-year high, while other commodities such as oil and wheat have also surged due to the Ukraine conflict.
On top of this, aluminium and nickel prices have been up by 30 percent since the beginning of the year.
The news comes a week after Food and Drink Federation chief executive Karen Betts warned that supply of commodities like “grain and sunflower oil, as well as other inputs, including packaging” could be affected.
The war in Ukraine has also contributed to global energy prices and is expected to see UK’s inflation rise from 5.5 percent to 8 percent in a matter of months.
