A mix-up at a Dutch warehouse led JPMorgan Chase to mistakenly purchase bags of stones that were thought to be nickel, according to a new report.
The report from The Wall Street Journal Monday came after the London Metal Exchange revealed last week that there had been a mix-up with its nickel supply. But it did not identify the owner of the supposed nickel bags or the warehouse where they were kept.
An operator at the warehouse weighed the bags thought to contain more than 50 metric tons of nickel only to discover that they were filled with stones. People familiar with the matter told The Journal the warehouse was owned and operated by logistic firm Access World which will likely be liable for the bill. Access World is owned by miner and trader Glencore PLC.
Access World told the outlet it is inspected "warranted bags of nickel briquettes at all locations" but believes the issue to be "an isolated case and specific to one warehouse in Rotterdam. "
Had the material actually been nickel, an essential element used in steel and electric-vehicle batteries, the bags would have been worth around $1.3 million, or 0.14% of nickel inventories, Bloomberg reported.
The low quantity suggests the mix-up will have relatively little impact on metal markets. But the incident underscores the complexities of investing in a scandal-ridden industry subject to extreme price volatility and supply chain disruptions.
JPMorgan Chase is reported to have purchased the bags years ago. The firm did not respond to FOX Business’ request for comment.