August 12, 2022 – The nickel market rally continued into the weekend in Asia. And also the nickel on the LME. Where does this new nickel price rally come from? The ingredients for a new significant price increase in the raw material, which is not only important for stainless steel, are in any case already spread out on the table.
Nickel continues rally towards the weekend
The Asian nickel futures have continued their rally towards the weekend. In some cases, it went up more than 6.5% for individual contracts. The most actively traded contract rose by more than 4.3%.
Already yesterday, the LMEselect 3 months nickel increased by more than 5.1%. Since the beginning of the week even more than 9%. With a plus of 1.7%, the nickel also started Friday’s trading on the LME positively.
Where does this new nickel price rally come from?
The LME nickel stocks have been falling for months. From July to August alone by more than 15%. Year-on-year even by almost 75%. SHFE stocks are also at their lowest level in years.
Ingredients for new rally are there
Add to this the easing US inflation, a slightly weaker dollar, the new climate package of the US government, the just announced nickel deal between e-car maker Tesla and a Chinese nickel producer in Indonesia for $5 billion, and the current price rise is hardly surprising.
If you now add the very likely coming nickel export tax of the Indonesian government, you have everything you need for a price increase in view of the global political situation.
Nickel stocks soon exhausted?
The Indonesian government had also expressed concern that nickel deposits could be depleted too quickly due to an outflow of low-grade or unprocessed nickel to China.
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- Chinese aluminium output close to legal capacity limit?
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