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LME Nickel Stocks

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#583

Nickel flies off before being put under pressure
Vale’s mining disaster in Brazil provoked an examination of the conscience of the most polluting mining producers. Nickel became scarce, metal prices climbed, before erasing their gains. Why ? China’s exports fell sharply …

Discreet negotiations around the price of a nickel contract in London © Alain Jeannin
© ALAIN JEANNIN Discreet negotiations around the price of a nickel contract in London
By Alain Jeannin
Posted on the 09/03/2019 at 02:52, updated on the 09/03/2019 at 03:18
Nickel, of which New Caledonia is the world’s sixth largest producer, was the best pupil of industrial metals during the first three sessions of the week on the London Metal Exchange (LME). The metal has reached a high of 13.765 dollars per ton, a price level never seen since August 18, 2018.

Friday, poor Chinese economic statistics have erased the gains recorded earlier this week. Nickel is subject to headwinds: a strong dollar and a decline in Chinese exports are unfavorable, conversely, a supply below demand and a deficit announced support metal prices.

China still …
In London and Shanghai, analysts followed the rise in nickel. Lower metal production in China, particularly in Mongolia’s Autonomous Province, has contributed to concerns about Chinese steelmakers’ supplies. Maintenance operations at the metallurgical plants have resulted in a decline in nickel smelting (NPI) production noted Marex dealer Spectron. To make matters worse, a lack of electricity has slowed production at many factories in Mongolia’s Autonomous Province.

Supply fell
But what dominated the news this week is environmental issues. They have returned to the agenda of the London metals market. In China, still in the autonomous province of Inner Mongolia, particularly polluting industrial sites have been closed in recent days. They belong to Xinhai Technology, China’s largest producer of cast iron (NPI) with 120,000 tons per year of nickel content. More and more, the question now seems to be “how” to extract more clearly industrial metals including nickel. This subject, the environment, was at the heart of the sale of Mining Indaba in early February in South Africa.

Environmental standards
Sanford Bernstein, the leading North American analysis company in the sector, said a Tshingshan nickel project in Indonesia would require more time and investment than expected. New standards, especially for the protection of the environment (especially after the Vale disaster) will have to be integrated. For example, the London nickel market (LME) is awaiting confirmation of a decision targeting the Brazilian producer Vale. A court order of 26 February requires the world’s largest nickel producer to comply with environmental regulations for the operation of its Onça Puma mine and ferronickel plant (18,000 tonnes of annual nickel content) in the Brazilian state of Para near the city of Ourilandia do Norte in Brazil. The Brazilian group, under pressure from the authorities, will appeal the decision requiring it to stop production of nickel on the site, according to information from Bloomberg. Vale CEO Fabio Schvartsman presented his temporary resignation on 2 March following a recommendation by the Brazilian prosecutor’s office. Three other executives of the company left their office after the rupture in January of a dam of mining residues in Brumadinho in Brazil …

“The inclusion of new environmental standards by mining producers will contribute to the global nickel deficit that will grow every year by at least 2025”
Dee Perera, Marex Spectron Analyst at LME.

Cold shower
Nickel, which had reached new highs since the beginning of the year, ran out of steam Thursday night before dropping sharply Friday. New statistics have indicated that Chinese exports fell more sharply in three years in February, suggesting that the slowdown in the Chinese economy will continue despite a series of support measures taken by Beijing. China’s industrial exports fell by 21% year-on-year in February, the sharpest decline since February 2016, as a result of a slowdown in new orders in the context of a trade war between Beijing and Washington.

Friday, the price of nickel was down slightly, over the week, the metal recorded a small loss of -0.13%. It closes at $ 13,172 per tonne ($ 5.97 per pound.)


#584

#585

#586

Thanks chaps for your articles and info


#587

#588

#589

According to Bloomberg, the planned meeting between US President Donald Trump and Chinese President Xi Jinping to sign an agreement to end the trade war will not take place this month and is most likely to happen in April


#590

The last time (2014) in which Nickel’s stocks in LME were at the levels that they are now, prices reached in that year at 18,000usd/Ton, but EUR/USD were at 1,3888


#591

#592

#593

Brazilian iron and nickel push up sea freight prices
Indifferent to the endless series of Brexit, nickel has resisted this week. On the downside, Brazil’s Vale ore exports are skewing sea freight prices.

The port of Vavouto (North Nickel Factory) in New Caledonia © Alain Jeannin
© ALAIN JEANNIN The port of Vavouto (North Nickel Factory) in New Caledonia
By Alain Jeannin
Posted on 16/03/2019 at 03:19, updated on 16/03/2019 at 03:40
The metals market remains focused on China, the world’s largest importer of raw materials, whose economic slowdown could weigh on demand.

Nickel looks to China
The rise in Chinese industrial production has eased slightly, to 5.3% compared to the same period last year, against 5.7% in December, said Thursday the National Bureau of Statistics (SNB). “This has fueled fears about demand,” commented Commerzbank analysts. But the Chinese government has announced a sharp reduction in VAT for the manufacturing sector that will come into force in April, which reassured investors in metals. Finally, trade tensions between China and the United States remain in the sights of market players. US President Donald Trump has again expressed his optimism Thursday on a future trade agreement with China, saying expect a decision within three to four weeks. However, the London metal market was hoping for a meeting in March …

Nickel markets
Nickel inventories were significantly higher this week in the Shanghai Futures Exchange (SHFE) warehouses. They grew by 13.3%. Thus, the stocks held by Zhongchu Danchang in Shanghai, one of the largest nickel warehouses, increased by 1,470 tons.
The China Association of Automobile Manufacturers reported that sales of electric cars rose 53% in February to 49,000 units. These vehicles, whose batteries use nickel and cobalt, represent 4% of the Chinese car market, compared to 1.7% a year ago. The progression is sensitive but not spectacular. As a result, the price of nickel at three months has logically dropped by 1.1% in the Shanghai market, said the Metal Bulletin (MB Fastmarkets) of London. In contrast, the world’s leading stock exchange, the London Metal Exchange (LME) saw mandated nickel inventories plunge to 119,730 tonnes - reserves are at their lowest since 2012 - said trader Marex Spectron.

Mines and factories
On the producer side, Indonesian miner and metallurgist Antam, a direct competitor of the Caledonian mills, says it will produce 30,300 tonnes of ferronickel and 10 million tonnes of nickel ore in 2019. Exports are mainly to South Korea and South Korea. Europe. In Australia, two mining companies, Ausgold and Greaut Boulder announced the formation of a joint venture for Winchester’s nickel-copper-cobalt project in Western Australia. The production will mainly be for electric vehicle factories.

Sea freight
Good news for ore exporters? Commodity prices have come down this week. Like the LME for nickel, the flagship index of the shipping market, the Baltic Dry Index (BDI) at its London headquarters. It provides an average estimate of the rates charged on 20 bulk transport routes. The index (BDI) ended the week at its lowest level in three years. According to participants in the maritime transport market cited by AFP, the catastrophic rupture of a Vale dam in Brazil explains the lowering of global shipping rates by reducing the needs of the mining giant whose iron and nickel exports are limited.

On the LME, the ton of nickel for delivery in three months traded at 12.957 dollars (5.87 $ per pound) Friday at 16H20 GMT, against 13.170 dollars in the middle of the week. Over 5 days, nickel is down 0.97%.


#594

Hi TDT,

Do you know anytnhig about this?

“‘Green economy’ transition to boost cobalt, nickel, copper
The electric revolution is now inevitable, and like a rising tide will boost cobalt, nickel, copper, and to a lesser extent, lithium, according to new analysis from Bernstein.”


#595

Hi Nuno

I don’t have a subscription to Mining Journal so I can’t read the article but the headline is nothing new. Cost parity and expotential uptake of EVs had been predicted by several different people/sources. Visual Capitalist produced this the other day:-

https://www.visualcapitalist.com/electric-vehicle-sales/

The embedded links at the bottom give you some ideas of how long they’ve been more or less saying the same thing.

The 2022 cost parity for EVs with ICE was first predicted by Tony Seba back in 2017 I believe. I can’t find the exact link where he predicts this but you’ll find it if you look. He doesn’t predict the impact this will have on commodities but, all things being equal, I think that a given.

About 65,000 tonnes of nickel went into EV’s in 2018 and 2018 produced just over 2m EVs of varying types. My prediction for the next 4 to 5 years is:-

2019 - 3.13m to 3.22m (102,000 to 105,000 tonnes)
2020 - 4.85m to 5.17m (158,000 to 168,000 tonnes)
2021 - 7.52m to 8.27m (244,000 to 269,000 tonnes)
2022 - 11.65m to 13.23m (379,000 to 430,000 tonnes)

I’ve worked out the likely demand for nickel from the figures we know from 2018. The numbers have been rounded up/down for ease of reference.

The faster the uptake the quicker the price falls. It’s a self-fulfilling prophecy in many respects.

TDT :sunglasses:


#596

Found it.

25 minutes and 30 seconds in is where Seba predicts every vehicles sold from 2025 onward will be electric. So far he’s been pretty accurate with his predictions so I can see no reason why he might not be on the money with this one.

TDT :sunglasses:


#597

More of the same,

https://www.insidesources.com/for-energy-security-think-evs/


#598

Going to buy some Friday if it can stay above last week’s close, by Friday afternoon. Everything else seems in order so just waiting the price now.


#599

Nuno

It might be more of the same but its worth noting who is saying it. When the polar opposite of a tree hugger starts pushing EVs you know that traction is really starting to kick in.

TDT :sunglasses:


#600

https://www.bloomberg.com/news/articles/2019-03-14/the-case-for-the-world-economy-s-defense-even-as-growth-slows

Why the Worst May Already Be Over for the Global Economy


#601

https://www.adamasintel.com/china-nickel-deployment-january-2019/


#602