Nickel Pig Iron

Good news for stainless consumers, the nickel price dropped to its lowest level in six years this week as London Metal Exchange 3-month nickel price declined $390, or more than 3%, to $12,540 a metric ton according to the FT.

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After hitting a high in May of last year on expectations that Indonesia’s export ban would create a shortage, the market has declined as the deficit has failed to materialize. Indonesian supply was simply replaced by increased supply from the Philippines, up 23% in 2014 from a year before.

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The Nickel market enjoyed a bull run in Q1 of this year following the Indonesian government’s hefty export tax on nickel ore exports resulting in a defacto ban. Overnight almost a third of global supply disappeared from the market and although Chinese Nickel Pig Iron (NPI) producers had been stockpiling supplies, nickel price rose as investors assumed the market would move rapidly into deficit.

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To their consternation, and to most observers’ surprise, it has not. Indeed, China appears to be accessing adequate supplies from other sources to supplement its stocks of high-grade Indonesian material.

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You say potato, I say potatoh – such is the atmosphere lately surrounding the price outlook for nickel in 2014 and beyond. MetalMiner has been covering the Indonesian mineral export ban up, down and sideways, especially how it will (or won’t) affect the nickel markets this year, and we’ve struck a tone that’s not as […]

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Indonesia is the world’s biggest exporter of nickel ore, refined tin and thermal coal and home to the fifth-largest copper mine and top gold mine, in addition to being a major bauxite, zinc ore and iron ore supplier. We got into how the ban affects copper concentrates in Part One here. The Indonesian authorities did […]

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The nickel market is in oversupply, at least for the medium term. This is Glencore’s opinion, given as part of the firm’s recent Investor Day presentation. Large-scale projects started in the last decade (in many cases, years late) coming to fruition will add an additional 250,000 tons of supply, even as a significant proportion of […]

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Nickel holds the dubious honor of being the worst-performing base metal in 2012 with a fall of 13% since January this year, coming on top of a 6% fall in 2012, according to Nickel Investing News. Currently the metal price is around $15,200 per metric ton cash on the LME, while stocks have rocketed 56% from […]

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We reported some months ago on Indonesia’s decision to ban the export of certain minerals and subsequently apply an export tax on raw ores in an attempt to maximise the return from the country’s natural resources. Indonesia is acutely conscious that by exporting raw mineral ores it is leaving the value-add opportunity to its overseas […]

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Continued from Part One. In China, about 700,000 tons of capacity have been idled in recent months in the top-producing province, but the reality is this has been replaced by new, lower-cost capacity in western provinces — capacity is still growing at double-digit rates. A Reuters article notes that the aluminum market is expected to have a surplus […]

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At a recent presentation to a group of industry CEOs, my colleague Lisa Reisman was asked for her views on the nickel market. Coincidentally, this was a topic we had been discussing just the day before, and although we had written about it as recently as early December, there had been so much movement we […]

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