Nickel jumps AAP APRIL 03, 2015 NICKEL has extended its rebound...

Nickel jumps
AAP APRIL 03, 2015
NICKEL has extended its rebound as some investors regard the recent losses as overdone while a slide in the US dollar ahead of the long Easter weekend helps boost other metals.
NICKEL on Thursday tumbled to its lowest levels in nearly six years this week, hit by heavy fund selling largely on worries about lacklustre demand in the stainless steel sector.
Some investors believed the drop to be exaggerated, since it put a large swathe of the important Chinese nickel pig iron sector into loss-making territory.
"Most Chinese NPI producers are under water at these prices, so it's really not sustainable under $US13,000," Macquarie analyst Vivienne Lloyd said.
NPI, used in the production of stainless steel and as a cheaper alternative to refined nickel and ferronickel in China, had production costs of $US14,000-$US17,000, she added.
Benchmark nickel on the London Metal Exchange (LME) jumped 2.5 per cent to close at $US13,025 a tonne, stretching a recovery from a low of $US12,310 in the previous session. It still chalked up a weekly loss of about two per cent.
"We are going to see more NPI and ferronickel cutbacks later in the year. The pollution issue will be a much bigger deal than a lot of people think," said Sydney-based AME Group analyst Matt Fusarelli.
Chinese Premier Li Keqiang in March said he would do all he could to fight pollution, and some steel and NPI producers have already been closed in an indication that the government is stepping up enforcement of new environmental laws.
Reflecting an improvement in demand, premiums for Shanghai bonded nickel jumped $US20 to $US135.