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Nickel fundamentals remain positive. While BHP expects a demand growth of 500% for battery nickel, a Chinese producer stops production. Nickel futures on LME and SHFE seem to have noticed this as well. The World Bureau of Metal Statistics has identified a shortfall of more than one million tons in aluminum in the first six months of 2021. And have the Asians pulled out of the sale of Italian stainless steel producer Acciai Speciali Terni? Can thyssenkrupp still sell AST now? 

Stainless Espresso: Nickel fundamentals remain positive
Stainless Espresso: Nickel fundamentals remain positive

 Aluminum shortage – over 1 million tons deficit 

From January to June 2021, a deficit in aluminum production of more than one million tons has accumulated so far. This at least according to the figures of the World Bureau of Metal Statistics.   

Aluminum producers cannot keep up with demand  

Even though global aluminum producers are trying to increase their production, they are obviously not able to keep up with demand. Many producers are also completely booked up. The energy shortage in China is also reducing output there, in some cases significantly.  

Aluminum prices up 32 % 

Market data show that the most widely used metal on earth has risen 32 % this year, making it second only to tin among the six base metals traded on the LME.

Nickel fundamentals remain positive  

The most active SHFE-2109 nickel contract rose 0.56% last night to close at 144,440 yuan/mt. On the SHFE, nickel said goodbye to trading with slight losses, while on the LME it turned north again after a short decline. Yesterday, the nickel supply rate was 34% and the demand rate was over 112%.  Overall, however, the outlook remains positive.

Source: shfe.com.cn, lme.com

BHP expects 500% growth in demand for nickel for batteries  

“Demand for nickel in batteries is estimated to grow by over 500% over the next decade, in large part to support the world’s rising demand for electric vehicles,” BHP chief commercial officer Vandita Pant said at the time.

Source: bhp.com

Chinese nickel producer stopped producing nickel cathodes  

Jilin Jien Nickel, a producer in northeast China, has stopped producing nickel cathodes because it is no longer profitable. In China, the world’s largest consumer of metals, there are very few companies left producing nickel cathodes as smelters opt instead to produce nickel sulfate, a chemical used in the burgeoning electric vehicle battery sector.

Source: investing.com

Italy: Asian interest in Acciai Speciali Terni extinguished? 

Italian media report that the interest of Asian steel giants Baowu and POSCO in Italian stainless steel producer Acciai Speciali Terni (AST) seems to have been extinguished.

Only Italian companies still in the race? 

If the rumors are confirmed, only the Italian companies Marcegaglia and Arvedi are still interested in acquiring AST from the ailing thyssenkrupp steel group.

Sale of AST in total at risk? 

If the Asians really are no longer in the running for AST, it may well be that the interest of Marcegaglia and Arvedi will also wane, putting a sale as a whole at risk. This could leave thyssenkrupp sitting on the stainless steel producer, which would be very inconvenient for the Germans.

The Chinese and South Korean steel producers at least seem to have seized the opportunity to take a look at AST’s books.

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