In my point of view, we will see an excess in the nickel NPI market, and a growing deficit in the Nickel class 1 market.
While the market is already operating at different prices, LME can not make two separate contracts while liquidity is low.
The true “adventure” for nickel class 1 is in 2020/2022 …
It is for this reason that many analysts, and when talking about Nickel, have great doubts about the ability to supply Nickel Class 1.
The HPLA may be executable at a price of 14,000 USD in Indonesia, but outside Indonesia the premium has to be higher.
The $14,000 per tonne figure published by Tsingshan is based on them being able to replicate what Ramu achieved in PNG. There’s a world of difference between what the Indonesians will allow and what Ramu got away with in PNG. Tailings disposals for a start is one area where Indonesia will be far more strict. In fact it wouldn’t be hard for them to be more strict given that Ramu dumps its tailings offshore.
Then there’s the issue of the ore itself. From memory one of the principal reasons why so many HPAL plants around the world had problems was down to the composition of the ore from country to country being different.
I think $14,000 per tonne is aspirational. I do not believe this figure is achievable in Indonesia.
The class1/class2 issue will come to a head eventually. I strongly suspect a lot of what we are seeing with LME stock at the moment is down to speculation in anticipation of the market bifurcating. Figures out today show a modest drop of -210 tonnes in the opening stock levels but a significant drop in live warrants, -1,422 tonnes, and increase in cancelled warrants, +1,212 tonnes. If this rate of decline continues live warrants will be down to zero in less than 12 months.
The adventure for nickel may happen sooner than you think.
PS Some excellent posts by the way, thanks for sharing.
In fact, it is only words when someone speaks about “a responsible mining”, I am talking about Cobalt of the DRC, because when they speak about Nickel HPLA , they forget that it is a “hell on earth”
You do not need to thank, your help is essential.
Of course I had to answer:
It’s sad not to talk more about the nickel market, as it’s obvious that it will not take 10 years to reach a market share of more than 10%.
As you refer, in your excellent article “5 Mega Investment Trends To 2025 And The Main Players” and without taking your market penetration rate accounts for the EVs, but instead
I will use the Bloomberg research, we already have more than 10% in 2025.
On the other hand if we use your penetration rate, there is no nickel class 1 on the market.
But as we know, when there is no raw material on the market, or it is too expensive, new technologies rapidly emerge to replace it.”