The nickel market went on a super-charged rally over the first half of last year, the benchmark London Metal Exchange (LME) three-month price racing up from below $15,000 per metric ton to a May high of $21,625.
The trigger was the well-flagged but widely unexpected decision by the Indonesian government to ban the export of unprocessed minerals in January. At the stroke of a presidential pen, China’s massive nickel pig iron (NPI) sector lost its main source of feed. Great expectations, however, were dashed by reality, specifically a compensatory surge in nickel ore supply from the Philippines.
The subsequent price collapse was as spectacular as the original rally. And here we are again, the London nickel market kicking its heels around the $15,000 level.
Reuters’ Andy Home writes that the bull story hasn’t gone away. It has merely been postponed. Nickel is still metal analysts’ favored upside pick over a two-year time horizon. So, will this be nickel’s year (again)?