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LME Nickel Stocks

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#162

#163

TDT,

As I had said and suspected earlier, there is indeed storage for price protection.
Maybe we only can see higher prices 20,000 $ in 2023/2024


#164

Already two answers:

Silver Coast Research, Contributor
Comments230 | Following
Author’s reply » Nuno
Thanks for spotting this interesting article. But I’m not sure it changes the big picture.
We’d need to know how many tons were stored in “hidden” warehouses at the begininng of the year (to be compared with the current 465,000 estimate) to really estimate the impact.
Then, the article mentions material being transferred from LME warehouses in Asia to LME warehouses in the Netherlands. I’d expect that to be transparent in terms of LME inventories overall.
And finally, the fact that financing deals are on the rise shows that there is growing demand.
But it’s good to know these facts nonetheless, and I agree the world is probably not running out of nickel in the short term.

John Petersen, Contributor
Comments32554 | Following
Author’s reply » The thing with nickel is that battery industry requirements will be proportional with cobalt demand, but at a multiple ranging from 3:1 in the case of NCM 622 to 8:1 in the case of NCM 811. So if cobalt demand from the battery industry climbs to 300 or 400 kt per year, nickel demand could easily climb over 1,000 kt per year, a number that’s significantly higher than current global wrought nickel production. It is important to remember, however, that these are multi-year developments and short-term trends are not terribly informative.


#165

It all still points to an overall increase in Nickel prices as this would be the reason for buying and storing in the first place. I would be just as interested in knowing who it is that owns it because if it is the ned users (ie battery manufacturers) then it is not likely to ever be put back into the market and they will be using it themselves. Is it traders who have the intention of putting it back into the market when the price creeps up? Well if it is then they have extremely deep pockets so not as likely to me. Whichever though it all still points to a rising price in my opinion.


#166

I do not know, but it can be possible.

NICKEL: The global nickel market deficit narrowed to 7,100 tonnes in August from the previous month’s revised deficit of 16,500 tonnes, the International Nickel Study Group said


#167

Who can get it and post this article wera, please.

https://www.bloomberg.com/hyperdrive


#168

#169

It’s a marathon not a sprint. If it takes until 2020 then that’s what it will take. In the grand scheme of things that’s another 15 months, 27 months at the most.

TDT :sunglasses:


#170

BEIJING, Oct 22 (Reuters) - London copper prices rose for a
second session on Monday, extending a rally fuelled by a pledge
from China’s central bank that it would support firms with
liquidity problems.
The pledge was followed by comments from Chinese President
Xi Jinping on Sunday that the ruling Communist Party would
always support private-sector firms.
China is “multiplying its efforts to support the economy,
and in particular, the infrastructure sector amid domestic and
international headwinds,” such as the trade war with the United
States and high debt levels, Fitch Solutions said in a note.
The country’s demand for copper, an economic bellwether,
“will improve over the coming months as property completions and
grid investment picks up and demand from the autos and consumer
sectors remain buoyant,” added the research house.

  • OTHER METALS: Nickel, used to make stainless steel, was
    the biggest climber, tracking gains in Chinese steel futures
    to rise 1.7 percent in London, and 2.1 percent
    in Shanghai.

    • NICKEL: The bulk of nickel moving out of London Metal
      Exchange-approved warehouses in Asia is showing up in hidden
      facilities in Europe, analysts said, denting a bullish scenario
      of potential shortages

#171

But you wouldn’t want them to take too long.

https://stockhead.com.au/resources/battle-of-the-batteries-how-long-lithium-will-last-and-which-tech-will-take-over/?utm_medium=email&utm_campaign=Stockhead%20Morning%20Newsletter%20Mon%20Oct%2022%202018&utm_content=Stockhead%20Morning%20Newsletter%20Mon%20Oct%2022%202018+CID_60d96a24ac91b4584bc9fd237cf4c774&utm_source=Campaign%20Monitor&utm_term=Battle%20of%20the%20batteries%20how%20long%20lithium%20will%20last%20and%20what%20will%20take%20over

TDT :sunglasses:


#172

If it’s true “Flow of LME nickel to hidden storage dents bull story”, and if all this Nickel is thrown on the market, many companies that raised capital, are in risk of being discredited.

Speculation in this asset is incredible, as I said earlier “There are reports for all tastes, an undeniable fact is the fall in inventories (LME and Shanghai) that are due to storage in the” Giga Factories ", storage aimed at price protection, as is speculation about this asset "

What I find strange is the fact that the INSG, nothing to point out, all the INSG studies, pointed to another year of deficit. I still can not figure out what’s going on, but as TDT says, it’s a marathon.


#173

This is worth a read.

TDT :sunglasses:


#174

“It’s a marathon not a sprint. If it takes until 2020 then that’s what it will take. In the grand scheme of things that’s another 15 months, 27 months at the most.”

I like the sound of that. When you think 2020. Seems a long time away. But actually we are almost there.

S4


#175

World primary nickel production was 1.991Mt in
2016, and it is projected to increase to 2.07Mt in
2017 and to around 2.224Mt in 2018. There is a
degree of uncertainty in these figures, especially in
regard to Chinese and Indonesian NPI production.
The estimates do not include any general
adjustment factor for possible production
disruptions. World primary nickel usage was
2.027Mt in 2016. INSG forecasts increases to
2.137Mt in 2017 and to around 2.267Mt in 2018.
INSG recognizes the significant impact of the
current financial, economic and political
uncertainties on commodity market in many parts of
the world. The effects of the above on both the
supply and demand for nickel are not fully known.
The Study Group cautions that future market
developments could alter the forward-looking
market balance.


#176

TDT

In a rude way, and if the numbers of Vale are correct, considering also what INSG says.

World primary nickel production was 1.991Mt in 2016, and it is projected to increase to 2.07Mt in 2017 and to around 2.224Mt in 2018. There is a degree of uncertainty in these figures, especially in regard to Chinese and Indonesian NPI production.
The estimates do not include any general adjustment factor for possible production
disruptions. World primary nickel usage was 2,027Mt in 2016. INSG forecasts increases to 2,137Mt in 2017 and to around 2.267Mt in 2018.

The accounts could be made this way:

36,000 t this year
700,000 t in 2025 implies a year-on-year growth rate of approximately 52,5%, compared with the estimated total production for 2018

Year Ni Batteries World Production %
2018 36000,00 2224000,00 1,618705036
2019 55080,00 2224000,00 2,476618705
2020 84272,40 2224000,00 3,789226619
2021 128936,77 2224000,00 5,797516727
2022 197273,26 2224000,00 8,870200592
2023 301828,09 2224000,00 13,57140691
2024 461796,98 2224000,00 20,76425257
2025 706549,37 2224000,00 31,76930642

In other words, the Nickel market, new holdings to maintain the balance should grow 33% by 2025
As we know, not all Nickel is suitable for Batteries, it further compromises this growth of the necessary supply
This may explain hidden Nickel storage, speculators awaiting price hike.


#177

https://stockhead.com.au/resources/90-per-cent-of-global-nickel-miners-are-making-money-at-current-prices-says-expert/


#178

Nuno

I think the majority of the nickel is being bought and stored by end users. The sort of price spike we would need to see over the next 24 to 36 months to make it worthwhile buying and storing a bulky commodity like nickel wouldn’t make it worth a specualtor’s while. A 50% increase in the price of nickel between now and 24th. October 2020 makes all the difference to us but I’m not so sure that sort of margin over a 2 year period is all that attractive to a speculator.

I could be wrong but it seems to me that if all the major car companies are moving into EVs in the way they are then one of the first things they would want to do is secure adequate supplies essential raw materials. There’s nothing more essential than nickel.

TDT :sunglasses:


#179

But if it is being bulk bought and stored, who’s controlling the price ?


#180

Bob

The market for stainless steel is softening, that’s pulling the price down. Unfortunately we have one market for what is essentially two different markets/products. The larger market, stainless steel/class 2, is dominating the smaller market EV batteries/class 1.

I suspect battery manufacturers can’t believe their luck. There is a massive overhang of class 1 nickel in the LME and they’re being allowed to buy it at relatively low prices. This will not last for ever IMO.

TDT :sunglasses:


#181

Nuno

I’ve just seen your Stockhead link. It looks like we are in agreement.

TDT :sunglasses:

“Mr Smith said there is talk about some of those stocks going from Asia to Europe to be held in non-registered warehouses.”

“Even if that is true it would only be a small portion of the total amount that has been drawn down,” he said.

“There is also talk that some of the battery manufacturers are stockpiling for future use.

“Either way, it doesn’t matter — it’s a very big positive for the nickel market going forward.”