Nickel Up, Poll Shows How Blindsided Analysts Were by Indonesian Ore Ban

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Reuters’ Andy Home reports that the latest quarterly poll of base metals analysts, out earlier this week, lays bare the extent to which the entire market was blindsided by Indonesia’s January ban on the export of unprocessed minerals.

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The ban has severely affected operations at the country’s two copper mines, but the impact on the nickel market is structural, with the flow of nickel ore to China’s huge nickel pig iron (NPI) sector choked off.

The reality of the ban has caused a dramatic change in the collective view about nickel since the January poll, which was conducted just at the time the ban was coming into effect. Collectively caught off guard by Indonesian policy-making, analysts can take some comfort from the fact that zinc, viewed as the base metal with the best prospects back in January, has lived up to expectations.

The cash price of primary Indian nickel saw a 0.8 percent increase on Thursday, July 24, reaching INR 1,155 ($19.26) per kilogram and making it the biggest mover for the day. On the LME, the 3-month price of nickel rose 0.4 percent to $19,060 per metric ton. At $18,955, the spot price of nickel finished the market day on the LME up 0.2 percent per metric ton.

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Chinese stainless steel prices closed flat for the day. The price of Chinese ferro-chrome saw essentially no change for the fifth day in a row, remaining around CNY 8,300 ($1,339) per metric ton. The price of Chinese ferro-moly remained essentially flat at CNY 145,000 ($23,396) per metric ton.

The Allegheny Ludlum 316 stainless surcharge held steady at $1.31 per pound. The price of Chinese 316 stainless coil saw essentially no change for the fifth day in a row, remaining around CNY 26,000 ($4,195) per metric ton. For the fifth day in a row, the price of Chinese 304 stainless coil remained essentially flat at CNY 16,400 ($2,646) per metric ton. The price of Chinese 316 stainless steel scrap saw little movement at CNY 16,100 ($2,598) per metric ton. For the fifth consecutive day, the price of Chinese 304 stainless steel scrap held flat at CNY 16,400 ($2,646) per metric ton.

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