LME Nickel 2022: One Hedge, Ten Brokers, $4B Erased │File 169 T1

<p></p><p><br></p><p><br></p><p>This episode is part of Financial Forensics Labs — two shows, one forensic methodology: The Due Diligence Files traces how institutions collapse, The Signal Files traces how the good calls get made. Built from primary-record research by a 15-year capital markets professional.</p><p>Get to know the framework, the other show, and the tools built from it — all in one place.</p><p>Explore </p><p><a href="https://www.financialforensicslabs.com.ar/">⁠⁠⁠⁠⁠⁠⁠Financial Forensics Labs — Forensic Finance Intelligence⁠⁠⁠⁠</a></p><p>LME Nickel Short Squeeze 2022: how a legitimate producer hedge grew so large, split across roughly ten different brokers, that not even the exchange meant to police the whole market could see the true size of the position — until the morning it broke, and the exchange retroactively erased nearly $4 billion in trades to keep the system from collapsing.</p><p><br></p><p>This is the financial autopsy of the 2022 London Metal Exchange nickel short squeeze. Tsingshan Holding Group, the world&#39;s largest nickel and stainless steel producer, run by trader Xiang Guangda, built a short position of roughly 100,000 to 200,000 tonnes of nickel — far larger than its own physical production could justify as a pure hedge — spread across about ten separate banks and brokers, so that none of them could see the full picture. When Russia invaded Ukraine in February 2022, fears over Russian nickel supply sent prices climbing, and on March 8, nickel surged more than 250% in days, briefly touching an all-time high above $100,000 a tonne — the largest short squeeze in the exchange&#39;s 145-year history. Had the LME processed margin calls at that morning&#39;s price, it would have needed to collect close to $20 billion from 28 banks and brokers in a single day, more than ten times its previous record, risking a cascade of defaults through its own clearing system. The exchange halted trading and retroactively cancelled the morning&#39;s trades, wiping out profitable positions some hedge funds had locked in only hours earlier.</p><p><br></p><p>We trace the full week: the market&#39;s reopening on new price limits it immediately hit multiple times, the standstill agreement a consortium of banks gave Tsingshan instead of forcing a default, and the legal battle that followed — Elliott Management and Jane Street sued the LME for a combined $472 million, arguing the cancellation was unlawful. Britain&#39;s courts disagreed at every leve