Goldman: Nickel will average US$16.82 per lb this year
Goldman Sachs JBWere Pty said on Friday that shares in Australian nickel miners Minara Resources Ltd, Independence Group NL and Jubilee Mines NL, which reached all-time highs this month, may fall as nickel prices drop.
A report by Goldman Sachs suggest that nickel prices, which hit a record high on April 24, may fall in the second half of the year due to waning demand from China as it substitutes the metal with the cheaper low-grade form laterite.
"We are increasingly concerned that brisk growth in low-grade ferronickel production in China has the potential to return the global nickel market to surplus from 2008," Goldman`s Ian Preston said.
Posco, the world`s fourth-largest steelmaker, said on April 25 that it will increase output of a nickel-free stainless-steel product fivefold by next year amid soaring prices for the metal.
Shares in both Mineara and Jubilee fell on the ASX on Friday whist shares in Independent rose 6.5%. (April 27)
MRE Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
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