London 11/01/2016 - Aluminium queues at LME-registered warehouses dropped sharply in December with the waiting time falling by 36 percent in Vlissingen, 15 percent in Detroit and disappearing in New Orleans, according to the exchange's latest queue report.
In Vlissingen, the queue to take aluminium out of Pacorini Metals' sheds fell to 302 calendar days or 10 months (210 working days) as of December 31 from 471 calendar days in November, it said.
The waiting time for aluminium at Metro's warehouses in Detroit decreased to 175 calendar days or less than six months (120 working days) from 206 days the previous month - there will be no more queue in the US city by June 22 if no fresh cancellations are made before then.
The queue to get aluminium, copper, lead or zinc from Istim Metals in New Orleans also vanished in December, compared with a 30-day waiting time in November.
And the queue that had emerged at Pacorini's sheds in Johor, Malaysia, to get hold of any metal fell to just 12 days at the end of last month from 31 days the prior month, the LME report showed. The waiting time is now just one-week long, according to market sources.
Other LME-registered locations had no queues as of December 31, according to the report.
The LME introduced a tough reform aimed at shortening queues in the past three years, targetting warehouse companies with delivery times exceeding 50 calendar days.
Some rules are already in place such as the linked load-in/load-out rates, while others like load out rate increase (LORI) and the controversial queue based rent caps (QBRC) will come into play later this year.
Warehouse companies responded to tougher rules by increasing rents by 10 percent and free-on-truck (FOT) charges by 12 percent on average for the year starting in April 2016.
Metro, which is owned by the Reuben Brothers, submitted the sharpest rent increase - up by a third to 72 cents per day per tonne for primary aluminium - while Pacorini Metals was surprisigly moderate with a four-percent rent increase to 52 cents.
The LME said it was reviewing what it regards as "out-of-line" fee increases and was mulling the possibility of implementing rent and FOT charge caps (CC).
(Editing by Tom Jennemann)