Energy transition to benefit nickel, copper prices in long-term:...

Energy transition to benefit nickel, copper prices in long-term: LME Week seminar panel
Platts, 11 October 2021

The energy transition is set to benefit nickel and copper in the long-term, with the demand-side to be boosted by rising electric vehicle sales and related battery demand, panel participants at the LME Week Seminar held Oct. 11. Pala Investment head strategist Jessica Fung said during the Metals Debate panel that the coronavirus pandemic had helped along the global transition to becoming more sustainable, whether it was environmental or social, and, as a result, the nickel market's prospects were "quite bright."Fung estimated that demand from batteries would make up 10% of the nickel market by 2025, rising to 30% by 2030, which was up from around 3% of nickel demand in 2020."By the end of this decade, one third of nickel demand is going to be used as an energy source, this is an entirely new market and drive for one of the major LME metals," she said. This meant that by 2030, the nickel market would need to be 60% larger than it was today to meet demand from traditional markets like stainless steel, as well as growing battery demand, she added.Despite growing demand, Fung was not worried about supply, saying that there were "plenty" of nickel projects, mostly in southeast Asia, that were expected to come online, therefore she believed there was enough supply to meet demand."This is not a structural supply deficit story, this is a demand story," she said.Nickel prices - currently around $19,221/mt - were expected to move structurally higher, Fung said, as the market was in a supercycle, as it was being driven by a singular driver, namely the energy transition."In a commodity like nickel, which is the most leveraged commodity to the energy transition (among the metals being discussed by the panel), this is one metal that will see a structural uplift in prices because we have to see it because of the supercycle, Fung said. "It's a very simple story - we will see structurally higher prices, because of the push towards sustainability."

https://www.spglobal.com/platts/en/market-insights/latest-news/energy-transition/101121-energy-transition-to-benefit-nickel-copper-prices-in-long-term-lme-week-seminar-panel