While nickel prices started September near 2009 lows, there have been signs of promise for the metal as various global factors, including Indonesia’s decision to continue to ban unprocessed ores, could lead to a price hike as the month draws to a close.
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Nickel producers face a unique dilemma with many reluctant to put their stock on the market due in part to both near-historic low prices and an oversupply in the market. However, the supply is expected to decrease this year and while this is a positive sign, it is offset by an overflow with demand down sharply in Q3. The situation in China has not helped matters either with many steelmakers wary of increasing their consumption.
So what does the future have in store for nickel? That depends on several factors: first, a sustained recovery from China, which would bring back demand in a major way and second, continued ore prohibition from Indonesia, which would suppress supply and enable the little guys to meet the demands from behemoths such as China and Japan.
Never Predict in a Volatile Market
Nickel and other base metals are currently in the throes of a bearish yet volatile market. In situations such as these, it is best to not think about predictions but instead have a well-thought out strategy in place that can move easily based on new market signals.
You can find a more in-depth nickel price forecast and outlook in our brand new Monthly Metal Buying Outlook report. For a short- and long-term buying strategy with specific price thresholds: