Nickel Price Headed for Biggest Drop Since September 2011

Bloomberg reported that nickel for three-month delivery is down 5.7 percent, at $18,999 per metric ton, on the London Metal Exchange. The base metal, which has enjoyed a gain of about 35 percent since the end of January, is now headed for its biggest drop since September 2011.

As quoted in the market news:

The gain in nickel inventories eased concern that Indonesia’s ban would drain supplies. China, the top consumer, has enough ore to make nickel pig iron, a low-grade alternative to refined metal, through August, according to Beijing Antaike Information Development Co.

Prices also had climbed amid speculation that the U.S. and Europe might add to sanctions on Russia, the second-largest producer of refined nickel, after it intervened in Ukraine. Vale SA’s suspension of activity last week at a South Pacific plant added to supply concerns.

The plunge ‘illustrates the extent to which speculation was apparently responsible for driving up the nickel price,’ Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt, said in a report. ‘The correction process could well continue for the time being.’

Click here to read the full Bloomberg report.