LME Outlines Plan for ‘Sustainable’ Base Metal Premiums: Shaping the Future of Low-Carbon Metals

The London Metal Exchange (LME) is advancing its plans to establish sustainable premiums for base metals, a move that is expected to significantly impact the metals market. During LME Week 2025, the exchange outlined its intention to implement low-carbon premiums for LME-approved brands, which will be tracked through a digital credentials register called LMEpassport. The premiums will be based on metals produced with lower carbon emissions, aiming to unlock the potential value of sustainable metal production.

Growing Demand for Low-Carbon Metals

The global demand for low-carbon base metals is on the rise, driven by increased awareness of climate change and sustainability. The LME is keen to respond to this shift by introducing premiums for low-carbon metals like aluminium, copper, zinc, and nickel. These premiums will be determined based on third-party sustainability assurances and data about carbon footprints. For instance, the LME has set carbon emission thresholds for its ‘green’ premium assessments, with a limit of 10 tonnes of CO2 per tonne for aluminium and copper, 3.5 tonnes for zinc, and 20 tonnes for nickel.

The LME’s new low-carbon initiatives have gained traction, with pilot programs already underway. In 2024, low-carbon nickel premiums were assessed and traded on the MetalsHub platform. According to recent data, nearly 55 tonnes of low-carbon nickel were traded between January and September 2025. This growing market for sustainable metals is becoming more robust, albeit with challenges in some sectors, such as copper, where market participants express doubt about consumer willingness to pay a premium.

Challenges and Opportunities in the Low-Carbon Metal Market

While the demand for low-carbon metals is clear, there are hurdles that the LME and stakeholders must overcome. The copper market, for instance, presents uncertainties around consumer readiness to pay a premium for sustainably produced copper. According to LME’s insights, market participants show significant reluctance in accepting higher prices for copper based on its sustainability credentials. As a result, copper may see less initial participation in the low-carbon premium pricing initiative compared to other metals like aluminium and nickel.

However, the introduction of low-carbon premiums presents substantial opportunities for metals producers and buyers alike. Companies with the ability to meet sustainability targets will likely benefit from higher market premiums, especially as ESG (Environmental, Social, and Governance) concerns gain prominence in investment and manufacturing decisions.

SuperMetalPrice Commentary:

The LME’s strategy to introduce low-carbon premiums reflects the growing importance of sustainability within the global metals market. While the challenges around consumer willingness, particularly in copper, may slow adoption in the early stages, the long-term benefits are clear. As industries move towards greener production methods, the LME’s push for low-carbon premiums will shape how base metals are valued in the future. The ultimate success of this initiative will depend on continued market participation and the evolution of consumer attitudes towards sustainability in metal production.