The London Metal Exchange, the main global metals market, suffered a big setback on Thursday in attempts to reform its warehousing network when a court ruled in favour of objections by Russian firm Rusal. The dispute hinges on plentiful supply of aluminium, and on low interest rates which encourage the stockpiling of metals. The decision by the High Court means that the new warehousing arrangements, a top reform for the LME, will be delayed beyond the intended launch date of April 1. Rusal, a leading group in the aluminium industry, had complained to the court that consultations about the new arrangements had been carried out in an unjust and illegal way. The LME had intended that the reform would oblige warehouses in its network to deliver more metal each day than they receive. Currently, a lapse of 50 days occurs before metal due for delivery can be collected. The purpose of the change was to counter big increases in charges for transportation, insurance and warehousing which consumers have to pay to take possession of their metal. Aluminium is the metal most affected by these delivery problems. Several companies which use aluminium had complained about difficulties in receiving physical metal from the LME and the increase in charges, which amount to up to 15 percent of the LME price. A spokeswoman for the LME said that the organisation continued to hold that the complaint by Rusal was unjustified overall, and was considering either appealing or beginning a new round of consultations. The president of Rusal, Oleg Deripaska, said his company welcomed the ruling and was keen to work closely with the LME and other concerned parties on the consultations and changes to the rules so as to improve the transparency of the market. Big producers of aluminium, including Rusal and US group Alcoa, had raised strong opposition to the LME's proposed reform. They would suffer from a lowering of charges since these help their cash situation given that the price of aluminium on the LME has fallen by more than half since 2008. - Low interest rates - The price has fallen because supplies are plentiful, even though users have difficulty in taking delivery of supplies. However, this is because since the financial crisis the stockpiling of aluminium has become a highly profitable activity owing to technical and financial factors, including exceptionally low interest rates. This has led to a rise of inventories and long delays for the release of metal from warehouses, and increasingly high charges. Some analysts were sceptical about the effect of the LME reform on the charges. Analysts at Commerzbank argued that an increase in base interest rates by the US Federal Reserve central bank would have a far bigger effect by reducing the financial return from the warehousing of metals. They also argued that producers of aluminium may have to reduce their capacity so as to reduce supplies and push up prices. In February, Rusal said that it would reduce its production by 3.5 million tonnes this year as part of a sharp reduction of its capacity.