Read the following article about demand and supply of Nickle for...

Read the following article about demand and supply of Nickle for the next couple of years.

MCR will be able to make record profits now and in the foreseeable future.

How long will it take for the markets to realise this and lift the shareprice to a level that reflects this upbeat scenario?????

Read the following article.



Inco: New projects will not meet demand
By: Dorothy Kosich
Posted: '17-SEP-04 05:00' GMT © Mineweb 1997-2004



RENO (Mineweb.com) -- In a presentation to a Hong Kong conference on Thursday, Inco President and COO Peter C. Jones predicted that underlying nickel demand will exceed 7% this year, based on 10% growth in stainless steel production.

Actually, Jones insisted his demand forecasts were conservative since scrap stockpiles in former Soviet Union nations are exhausted and scrap generation in China is limited. Underlying nickel demand for non-stainless steel uses is expected to increase 7% as well, he added.

"When we consider how China fits into the equation, the nickel supply/ demand situation becomes even more intriguing," Jones told the CSLA Investors Forum in Hong Kong. "China's nickel demand has soared more than 20% in each of the past four years. ...We believe that about two-thirds of China's nickel consumption goes to meeting domestic demand, leaving only about one-third for exported products." In fact, he added, "estimated nickel demand in China and Hong Kong in July was the second highest monthly level ever."

World nickel demand should climb in the second half of this year, as the expansion of Chinese stainless steel capacity is consuming more than 40,000 extra tons of primary nickel annually, according to Jones. China's regulators are advocating expansion of electricity generation, oil extraction capacity, and water and transportation infrastructure. "None of this can happen without lots of nickel," he declared.

Nickel supplies will continue to be tight even as miners produce at high or record levels. "The bottom line is that pressure on the nickel supply should continue at least through 2006," according to Jones. Inco is busy permitting its Voisey's Bay project, while BHP Billiton has announced it will build the Ravensthorpe project. Inco expects to make a final decision on whether to proceed with its Goro nickel project in New Caledonia in October.

Projected supply from these three projects is expected to be phased in from 2006 to 2010, said Jones. Most greenfield nickel projects are still in the feasibility stage, he said, and will take seven to 10 years to bring on stream including permitting times. Many of these deposits cannot be developed at a reasonable long-term price, he added.