Nickel shortage already greater than previously assumed?
Nickel shortage already greater than previously assumed?

24 May 2024 – The shortage of processed nickel may already be significantly higher than previously assumed. At least according to figures from recent media reports, which indicate a 30% increase in the nickel supply gap for March 2024. And the sentiment indicators in the eurozone point to growth. Germany is benefiting in particular from unexpectedly strong incoming orders in the manufacturing sector.

Nickel shortage already greater than previously assumed?

According to media reports, the International Nickel Study Group (INSG) had to announce a nickel supply shortage for March 2024 that was almost 30% larger than in the same month last year. The press release for the INSG April 2024 meeting already showed the INSG’s massive overestimation of possible nickel surpluses this year. In the press release, the INSG issued an uncommented forecast for 2024 which was revised downwards by a dramatic 55%.

We assume that the self-proclaimed experts will once again find reasons to relativise the supply deficit in March 2024. And we prefer to concentrate on the facts. Not only did the INSG have to correct a fatal misjudgement, which had a significant impact on nickel prices from autumn 2023, but it has now also had to admit to a significantly widening supply shortfall. A shortfall that nobody wanted to hear about until recently.

Beware of theoretical analysts without practical expertise

Now it has also become known from the market that the upward correction in stainless steel prices that had been looming for weeks was being talked down by so-called experts, just as they had already done in 2021. And this behaviour has always been to the detriment of real market participants.

It is therefore worth listening to more than just one so-called industry expert and not to purely theoretical analysts who have never traded a gram of steel or stainless steel in their lives.

Eurozone: Sentiment indicator points to growth

Growth in the eurozone is likely to have gained further momentum in May, according to the Purchasing Managers’ Index, a highly regarded leading indicator. The index for industry and service providers is now showing growth for the third month in a row.

Manufacturing industry with particularly strong growth

For Germany, it rose to its highest level for a year, mainly due to unexpectedly strong growth in the manufacturing industry index. Incoming orders increased at a robust pace, which was also reflected in a steady rise in employment.

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