how high will nickel go?, page-10

Threat of sanctions on Russia and Indonesia’s ban on ore exports have stoked prices
April 27, 2014:

Nickel prices have surged by 18 per cent in the last four weeks. Increasing fears of fresh sanctions on Russia, that could disrupt supply, has stoked prices.

Russia is the second-largest refined nickel producer in the world. Its share in global supply is about 14 per cent, next only to China’s, the top producer with about 40 per cent share.

Though the rise in nickel prices gathered momentum in the last four weeks, the actual rally had begun in January.

Indonesia, the largest exporter of nickel ore, imposed an export ban in January to promote domestic processing.

According to Barclays Plc, the global nickel market could run into a deficit in 2015 for the first time since 2010, because of this ban. China, the world’s largest nickel consumer, is expected to be hit badly.

Reports state that China had piled up its stock well ahead of this ban by increasing its imports to 6.12 million tonnes in January from 3.99 million tonnes a year ago. However, this stockpile is expected to meet the demand only till the last quarter of this year.

The International Nickel Study Group expects global supply of primary nickel to remain unchanged at 1.94 million tonnes in 2014.

Consumption, however, is projected to increase by 6.7 per cent to 1.89 million tonnes.

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