Market Manipulation and Transparency in Critical Mineral Markets
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Most critical mineral markets are small and private, so a few players can move prices and few statistics show it. The best-documented case is nickel on the London Metal Exchange in March 2022, when the price rose more than 270% in three trading days, from $27,080 to $101,365 per tonne, and the exchange suspended trading on 8 March and cancelled that day's trades. The exchange's independent review attributed the episode to large exposed short positions, withdrawn liquidity, price acceleration with margin calls and rapid risk reduction, and the exchange stressed that the review neither acknowledges nor excludes abusive behaviour. The Court of Appeal later held that the cancellation of trades was lawful.
+270%
rise in the LME nickel price over three trading days in March 2022, from $27,080 to $101,365 per tonne
4
contributing factors the independent review named: large short positions, withdrawn liquidity, price acceleration with margin calls, and rapid risk reduction
[2024] EWCA Civ 1168
Court of Appeal judgment holding that the LME acted lawfully and rationally in cancelling the 8 March 2022 trades
Source: Stephenson Harwood summary
17 June 2026
date G7 leaders called for better visibility on prices, supply, demand and processing capacities
Source: G7 Leaders' Declaration, Évian
What happened in the LME nickel market in March 2022?
The LME suspended nickel trading on 8 March 2022 after short positions were closed out at rapidly rising prices. Oliver Wyman, engaged by the exchange, set out four contributing factors, which are summarised in the table. The review did not examine the exchange's own decisions, which the Financial Conduct Authority and the Bank of England reviewed separately, and the LME stressed that its list of factors neither acknowledges nor excludes abusive behaviour.
| Contributing factor | What the review found |
|---|---|
| Large, exposed short positions | Positions were fragmented across counterparties and between exchange and over-the-counter trades, which reduced visibility, and position limits and accountability levels did not prevent large positions building up. |
| Withdrawal of liquidity | Nickel is a volatile market exposed to geopolitical risk; the market believed large short positions were under pressure, and few participants were willing to take the opposite side. |
| Price acceleration and margin calls | The LME's price volatility controls did not control volatility during the events, and participants came to doubt whether members could withstand them. |
| Rapid risk reduction | Hedges used LME nickel prices against sales priced on Class 2 nickel, creating basis risk, and members had no well-rehearsed approach to closing out large positions. |
Source: LME Group response to the Oliver Wyman independent review (Notice 23/007, 10 January 2023), which includes the final report. The review found that the over-the-counter market played a significant role. The LME said it had introduced daily price limits and periodic reporting of over-the-counter positions.
The legal outcome was separate from the review. A hedge fund whose trades were cancelled challenged the decision, and the Court of Appeal ([2024] EWCA Civ 1168) dismissed its appeal, finding that the extreme price move met the test of exceptional circumstances, which it described as a "once in a generation event", and that the LME acted lawfully.
Where are critical mineral markets opaque?
The risk is greater outside the few exchange-traded metals, because the data that would reveal a squeeze are missing. USGS shows the gaps in its own tables and notes.
| Gap | Evidence (USGS, 2025 data) | Why it matters |
|---|---|---|
| No assessed price | The gallium price in the salient statistics is the average unit value of U.S. imports, $580 per kilogram. | A customs value lags the market and mixes grades. |
| Hidden inventories | The cobalt industry stock estimate excludes stocks held by trading companies and held for investment purposes. | Stock building by traders cannot be seen. |
| Government stocks | From 2023 USGS no longer publishes Government stock changes in its salient statistics. | The state as buyer or seller is invisible in the balance. |
| Withheld data | The quantity of secondary tungsten produced was withheld to avoid disclosing company proprietary data. | Recycled supply cannot be sized. |
| Unverifiable production | Germanium production data were limited and hard to verify. | Supply shocks are hard to detect. |
| State intervention | Congo (Kinshasa) banned cobalt exports in February 2025 to address oversupply and low prices, then set quotas. | A producer government set the price direction directly. |
Source: USGS Mineral Commodity Summaries 2026 chapters on gallium, cobalt, zinc (footnote on Government stock changes, repeated in other chapters), tungsten and germanium.
What are governments doing about transparency?
Governments are asking for more data rather than regulating prices. At the Évian summit on 17 June 2026 G7 leaders called for better visibility on prices, supply, demand and processing capacities, said they continue to explore measures including price-gap subsidies, quotas and price floors, and asked the IEA and OECD to help members identify and receive early warnings of market distortions. They also agreed to exchange information on stockpiling systems. The benchmarks page covers the agencies that publish the prices, and the inventories page covers what stocks show.
Frequently asked questions
Has a critical mineral market been manipulated?
The best-documented disruption is the LME nickel market in March 2022, when the price rose over 270% in three days. The independent review identified structural causes, and the exchange stressed that it neither acknowledges nor excludes abusive behaviour. The court case that followed concerned the cancellation of trades, not manipulation: the Court of Appeal held that the exchange acted lawfully in cancelling them.
Why are critical mineral prices opaque?
Most critical minerals trade privately rather than on an exchange, so prices come from agency assessments or customs values. USGS, for example, reports the gallium price as the average value of U.S. imports, $580 per kilogram in 2025.
What is the difference between manipulation and a supply restriction?
Manipulation is trading conduct meant to move a price artificially, while a supply restriction is a policy that limits exports or output. Congo's 2025 cobalt export ban was a policy, stated by USGS to address oversupply and low prices.
What did the G7 say about market transparency in 2026?
On 17 June 2026 G7 leaders called for better visibility on prices, supply, demand and processing capacities and asked the IEA and OECD to help identify early warnings of market distortions.
Sources
Read on October 13, 2026. Figures on this page come from these documents; where a number is an estimate, the source says so.
- LME: Group response to the Oliver Wyman independent review (Notice 23/007, 10 January 2023). Includes the final report; read as text
- Stephenson Harwood: Court of Appeal finds for the London Metal Exchange in Elliott litigation (30 October 2024). Law firm summary; the judgment itself was not read
- G7 Leaders' Declaration on Securing Supply Chains for Critical Minerals (Évian, 17 June 2026)
- USGS Mineral Commodity Summaries 2026: gallium, cobalt, tungsten, germanium and zinc
