Jeddah port gets London Metal Exchange approval for storage

Matt Crossick/EMPICS

• No warehouse approved yet
• Saudi Arabia joins 24 others
• Boost to logistics ambitions

The London Metal Exchange has added Saudi Arabia’s Jeddah Islamic Port to its list of locations for the storage of copper and zinc, though no warehouse has been approved yet. 

“The listing of Jeddah will become active as a delivery point three months after the approval of the first warehouse company in that location,” a spokesperson for the exchange said, declining to say how many warehouses were currently under consideration. 

The London Metal Exchange (LME) has a list of around 450 approved warehouses in 14 countries, with South Korea, the Netherlands and Malaysia the leading storage points.

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The only locations in the Middle East are three warehouses in the Jebel Ali Free Zone in the UAE 

The LME is the world’s biggest and oldest metals exchange, and its approval for storage is a gold standard in the industry. 

The LME said there were no plans at present to include aluminium among the approved storage materials in Jeddah. Gulf countries accounted for around 9 percent of global aluminium production in 2023, the Gulf Aluminium Council says. 

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Bhavik Mehta, deputy head of research at Century Financial in Dubai, said the Jeddah listing would be a boost to Saudi Arabia’s plans to expand in mining. 

“Adding an LME-approved warehouse in Jeddah will strengthen Saudi Arabia’s standing in the base metals market,” she said. Saudi Arabia is the Gulf’s largest producer of copper.

Saudi Arabia wants to become the Middle East’s main logistics centre and launched a national logistics plan last year. The Dubai-based logistics company DP World has started work on a SAR900 million ($250 million) logistics park for storage and distribution in Jeddah Islamic Port.