Some interesting observations/comments there. I’d like to pick up on a couple if I may.
“Of all the studies that I have done, the current price level is not great for encouraging mining….”
Very true but if it were higher what would they mine? Laterites are one thing, abundant but costly to process, sulphides are much rarer. Even if prices were considerably higher what projects are there that are ready to go, the cupboard is virtually bare. Low grade high volume nickel sulphide projects like Dumont, Turnagain, Taalvivara need not just higher prices but consistently higher prices. Nickel’s average price over the last 30 or so years is around $6/lb. It would need to get up above and stay consistently above this level to make these projects viable.
“An exaggerated price increase will make manufacturers find alternatives to Nickel……”
If the price of nickel goes above $8/lb it makes it financially attractive to produce nickel sulphide (NiSO4) from laterites.
The above link is taken from Norilsk’s 2nd. Q 2018 investor presentation. They also suggested that class 1 nickel currently used in the stainless steel industry could be swapped for NPI. I don’t think we will be seeing a supply side crunch for some time.
You also need to take on board the length of time it takes to develop, test and get approval for new technologies, especially in the automotive industry. We see numerous articles in the press on different battery chemistries almost on a daily basis. None are ready to be rolled out on a commercial scale though. A new, nickel free, battery needs to be both cheaper and better than the current offering(s). That’s a big ask at the moment.
“Not to mention the risk of a “total trade war”, or a slowing of world growth”
A trade war is the biggest problem for nickel at the moment but I’m expecting the American people to neuter Trump at the forthcoming mid-terms. If the Democrats take control of Congress that should help cap Trump’s more destructive and irrational impulses.
As for all these different predictions from the industry experts I take it all with a pinch of salt. The only thing I do know is Amur Minerals, with the grade and size of resource they have, is sitting on a potential gold mine. This one simply requires patience.