nickel price bouncing back, page-5

A bit of a tough read being translated from French, BUT well worth the read.Hopefully without the pon rigging, from here a stable US$20lb+ is achievable.
Les Nouvelles Caladonienne 15/06/07

First crushing argument on the course of nickel
It is still too early to speak about a real inversion of tendency. But the ton of nickel, which beat all the records last May, lost more 10.000 dollars in one month. The whole on bottom of illicit financial operations.

Last on May 9, the ton of nickel dimensioned 51.800 US dollars in London. Absolute record. Yesterday, it was exchanged with 40.600 US dollars, that is to say 11.200 US dollars of less. It is the first tear of this scale since the beginning of the vertiginous rise of the metal, which leaped of 135% since January 2006. But beyond these figures, the most interesting aspect of this inflecting of the tendency is in slides: serious suspicions indeed surround quotations records of these last months.

Speculation on the courses

So much so that prestigious London Metal Exchange (LME), the market of reference which makes the rain and good weather for the non-ferrous metals - of which nickel - has just re-examined in urgency the rules governing the quotation of the metal of the devil. Why this brutal modification? “the LME detected collusive operations in the broking of nickel”, brought back it y six days a specialist in this trade (1). In other words, the courses of these last weeks would have partly inflated in an artificial way. Exactly what for several months the economic mediums and the specialized press have suspected, i.e. speculators decided to come “to make cash” by inflating the prices of nickel artificially.
The operation is altogether rather simple: before the LME does not modify its rules, a speaker could hold until half of the stocks controlled by the market. However, it seems that during last months, a producer and a broker established on the LME joined to make toy with the equivalent from 60 to 80% of these stocks. The reaction of the market was mechanical: the courses violently climbed. This illicit practice bears a name: abuse dominant position. And it is severely repressed. Until now, the name of the accused producer was not publicly revealed. And it is not known as that it will be to it one day. The committee of the LME, took drastic measures to him to secure such drifts: from now on, a speaker cannot only hold with him more of the quarter of the controlled reserves. The operations of destabilization are thus much more complicated to implement. First consequence: the course of nickel lowered in a quasi immediate way as of the implementation of these new rules.

No tumble

The dreaded tumble is not however for tomorrow. The analysts provide on the contrary that nickel should stabilize around 40.000 US dollars the ton until the end of the year. Because the fundamental ones of the market, them, did not change: the stainless steel producers, who absorb two thirds of nickel available, always have enormous needs and delay taken by the projects of factory (of which those of Goro Nickel and the North of Calédonie) does not make it possible to consider of significant rise of the world production in the short run. Nickel still has beautiful days in front of him.

(1) Echoes of June 8