High global stock levels of nickel, while worrying some investors, are unlikely to end a rally that started in January, Reuters said today, because some of it is not available and the rest is not enough to replace lost supplies from Indonesia after an ore export ban there in January.
Some of the nickel tonnage in London Metal Exchange warehouses has already been set for delivery; some is tied up in financing deals; and some is tightly held by Chinese producers and speculators and will be released only as a last resort, analysts told Reuters.
Benchmark nickel prices on the LME have soared by over 40 percent this year after top exporter Indonesia imposed a ban on unprocessed ore exports, leading to fears of severe shortages.
The spot price of nickel saw the biggest increase at 3.3 percent on the LME, finishing at $19,780 per metric ton for Tuesday, May 20. On the LME, the nickel 3-month price rose 3.1 percent to $19,785 per metric ton. At INR 1,171 ($20.05), the Indian nickel cash price finished the market day up 2.7 percent per kilogram.
Chinese stainless steel prices were flat for the day. The price of Chinese ferro-chrome continues hovering around CNY 8,300 ($1,331) per metric ton for the fifth day in a row. The price of Chinese ferro-moly remained essentially flat at CNY 145,000 ($23,250) per metric ton.
The Allegheny Ludlum 316 stainless surcharge continues hovering around $1.16 per pound for the fifth day in a row. The price of Chinese 316 stainless coil saw little movement at CNY 26,000 ($4,169) per metric ton. For the fifth day in a row, the price of Chinese 304 stainless coil remained essentially flat at CNY 16,400 ($2,630) per metric ton. The price of Chinese 316 stainless steel scrap held steady at CNY 16,100 ($2,582) per metric ton. For the fifth consecutive day, the price of Chinese 304 stainless steel scrap held flat at CNY 16,400 ($2,630) per metric ton.