Nickel Falls, Surplus Still Not Going Away

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Nickel fell on the London Metal Exchange for a 5th straight month after data showed global output beat demand.

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The surplus narrowed to 3,000 metric tons in November from 13,000 tons the previous month, the International Nickel Study Group said in an e-mailed report Monday. HSBC Holdings Plc cut its price forecast for the metal by 11 percent, citing increasing ore supplies from the Philippines.

The spot price of nickel weakened by 1.5% on the LME, settling at $14,550 per metric ton. The nickel 3-month price saw a 1.5% decline on the LME to $14,625 per metric ton. The cash price of primary Indian nickel inched up 0.9% to INR 910.00 ($14.68) per kilogram.

“The market may be disappointed that it is taking so long to shift from surplus to deficit,” Nic Brown, head of commodity research at Natixis in London, told Bloomberg News by e-mail.

Nickel for delivery in three months fell 1.7 percent to $14,535 a ton by 3:45 p.m. on the London Metal Exchange, after climbing 3.3 percent in the previous two sessions.

Rising 2.5% to close at CNY 107,500 ($17,383) per metric ton, the price of Chinese primary nickel experienced the biggest change for Friday, January 16. Chinese 304 stainless steel scrap saw little change in its price last Friday at CNY 9,350 ($1,512) per metric ton. Chinese 316 stainless steel scrap held its value last Friday at CNY 12,950 ($2,094) per metric ton. The price of Chinese 304 stainless coil held steady at CNY 16,700 ($2,700) per metric ton. For the fifth day in a row, the price of Chinese 316 stainless coil remained essentially flat at CNY 23,700 ($3,832) per metric ton.

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At CNY 10,950 ($1,771) per metric ton, the price of Chinese ferro-chrome was essentially unchanged. The price of Chinese ferro-moly held steady at CNY 87,000 ($14,068) per metric ton.

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