Nickel Supply Stalling Bull Run: Andy Home

Writing for Reuters, Andy Home drew attention to diverging trends on the nickel market that may be covering up a shortage of supply for the metal. He notes that although Indonesia has kept its ban on the export of unprocessed minerals and there are signs that other raw materials markets are tightenin for nickel, LME stocks are rising and China’s exports of refined nickel have soared this year.

As quoted in the publication:

Citi believes the time is fast approaching when raw materials pressures translate into NPI capacity closures. After holding steady at around 225,000 metric tons in the first half of this year, it forecasts China’s NPI output to contract by 38 percent year-on-year in the second half. It’s not an outlier view. In the latest Reuters poll of analysts only two out of 12 offering a market balance view for next year expect anything other than deficit. It’s just a matter of timing. But until there is tangible sign of scarcity in the refined part of the nickel market, the LME three-month price is going to struggle to resume its bull run.

Click here to read the full Reuters article.